Bitcoin: The Lightning Network sets a new capacity record
Bitcoin's Lightning Network just hit a record capacity high. Big exchanges poured in more funds. Developers rolled out fresh tools. An update to Taproot Assets moves Bitcoin toward handling various assets in its main system.
Imagine a huge Lightning Network structure under sunlight. It beams orange power through heavy cables. Exchange teams work hard to add liquidity at its heart.
Quick summary
Lightning Network capacity topped 5,600 BTC. Major exchanges upped their Bitcoin deposits in active payment channels. Node and channel counts sit far below 2022 highs. This points to more cash per channel, not wider network growth. Exchanges like Binance and OKX fueled the jump in November and December. Taproot Assets v0.7 adds checkable offers and addresses you can reuse. It backs stablecoins and other Bitcoin assets on Lightning.
Lightning Network packs on capacity, skips node growth.
The network reached its top capacity this week. It shows fresh focus from exchanges and support firms. Bitcoin Visuals clocked 5,606 BTC total on Monday. That beat the old high from March 2023. Amboss data showed 5,637 BTC on Tuesday. That's worth about $490 million.
Capacity spiked in November and December. It ended a long drop. Numbers prove more Bitcoin flows into current channels. This makes transfers quicker and cheaper across the setup.
Network use stays uneven overall. Lightning nodes number 14,940 now. That's down from 20,700 in early 2022. Channels dropped to 48,678 from past highs.
Lightning lets nodes set up payment channels backed by Bitcoin. Deals move through channels off the main Bitcoin chain. Balances shift without base-layer records. Fees drop. Payments speed up. Bitcoin's security stays in place.
Taproot Assets advances. It sets up multi-asset options.
Capacity jumps tie to exchange action. Amboss says gains come from many big players at once. They added liquidity together. Binance and OKX put extra Bitcoin into channels last month. That helped set the record.
Main drivers of the capacity rise:
Big Bitcoin adds from top exchanges. Cash shifts to open channels. Interest returns after capacity fell for months. Focus cuts user payment fees. Better tools handle bigger balances.
Ecosystem news shows wider uses. Tether put $8 million into startup Bitcoin Speed. Goal: stablecoin payments on Lightning. MetaMask now supports Bitcoin. It uses Native SegWit for transfers, not Lightning.
Lightning Labs dropped Taproot Assets v0.7. New bits include reusable addresses, checkable asset offers, and bigger deal support. It lets you create assets like Bitcoin stablecoins. Send them via Lightning channels.
Checkable offers let users confirm asset creation without blind trust. This boosts appeal for non-BTC assets on Bitcoin and Lightning.
Lightning Labs notes the latest Solana update clears paths for major asset shifts between Bitcoin and that network. It hints at bigger multi-asset plans ahead.