During an interview via CoinDesk, Nigerian immigrant Olaoluwa Osuntokun, CTO and co-founder of Lightning Labs, was talking about the Lightning Network and how it continues to grow. It exceeded 2,000 bitcoins deposited on its network. Olaoluwa Osuntokun, has been a frequent contributor to the underlying Bitcoin protocol.
He expressed the capacity that this entire network has as a whole to transmit payments on its channels. Likewise, Lightning surpassed the figure these days, and represents double what it had at the beginning of the year, when there were about 1,000 BTC deposited on the network.
The Lightning Labs co-founder has raised $ 2.5 million to turn Bitcoin into a more viable form of payment by making smaller transactions more profitable.
The Lightning Network protocol is a protocol designed to improve the scalability of Bitcoin. This is possible because the Lightning Network works as a second layer on top of Bitcoin. One that allows this cryptocurrency to do things that it normally could not and more specifically; instant transactions with very low commissions.
Driven by various, positively influencing factors, the growth of the Bitcoin Lightning network appears to have accelerated in recent months: In the first quarter of 2021, Lightning’s capacity increased steadily, the CTO said, but starting from May, the trend accelerated its growth rate. On May 1, Lightning’s total capacity was 1,231 BTC, but today it already exceeds 2,000 BTC.
Lightning Network capacity has increased by more than 750 BTC
Namely, the Lightning Network capacity has increased by more than 750 BTC in just under 2 months. Therefore, it could be said that in 60 days it has doubled all the growth it had from 2020 to 2021, when it just went from having approximately 800 BTC, to exceeding 1,100 BTC in those 365 days.
This growth means more nodes, more channels and, above all, more Bitcoins. But above all that users seem to trust the Lightning Network more and more. Will the offchain network work after all? A lot is being written about Lightning. For some, the offchain network for Bitcoin is the salvation for the perfect scaling; for others, it is a brain concept that can never work in reality.
The truth may be somewhere in the middle. After the network has been stagnant for a long time, now there is encouraging news: it is growing. And growing rapidly.
Initially, the Lightning Network grew at full speed after the network went live in early 2018. It reached an initial peak in the spring of 2019, then stalled for almost two years after a slight decline. It wasn’t until February 2021 that a clear trend towards higher growth emerged.
What is the reason for all this?
Specifically, the capacity in Bitcoin shows this by going from about 1,000 BTC to just over 2,000 BTC. It is literally exploding, but what is the reason? It is difficult to say. Possibly the trend towards payments with Lightning in El Salvador, as well as the designation of Bitcoin as an official means of payment in the Central American country, has contributed; possibly Lightning is working better and better as it continues to evolve. In this sense, a kind of tipping point has possibly been reached, making Lightning the standard – still in small circles – for international remittances, for example.
Regardless of the reasons, what matters is that Lightning is growing. Because when a network grows, network effects take over: it not only gets bigger, it gets better. Not only does it have more participants, but it works better for each of them. Osuntokun expressed.
To understand a little the potential of this technology, we must keep two things in mind. The first is that Bitcoin was created as a digital money solution. The second is that this goal is impossible to achieve in the current state of the Bitcoin network and software. The reason for this is very simple: Bitcoin has trouble scaling.
For this reason, a new way of making transactions quickly was needed, that was easy to use and compatible with Bitcoin without making major modifications. The answer to these needs and more is the Lightning Network.