- The Lightning Network is a solution to the problem of scaling the Bitcoin blockchain.
- The lightning network predicted to decongest bitcoin and reduce associated transaction fees.
- The use of the Lightning network is also higher than it expected.
As the news released on the 13th of January, the analysts at the research division of the BitMEX exchange had published a report which stated that the implementation of the Lightning Network to process bitcoin transactions has been proceeding more rapidly than expected.
By taking transactions faraway from the most blockchain, the lightning network predicted to decongest bitcoin and reduce associated transaction fees.
It is a Layer 2 payment protocol that operates on top of a blockchain-based cryptocurrency. It enables fast transactions between participating nodes and has touted as an answer to the Bitcoin scalability problem.
There has been a massive potential of LN in the previous year, as noted by many of the experts. The Lightning Network is a solution to the problem of scaling the Bitcoin blockchain. Along with it, the users can make transactions with record low commissions.
The Operations can also be combined, and post-processing it, the user can also close the channel. As per the BitMEX, more than 60,000 cases of closure of such channels had reported. Apart from this, a total of 6,000 bitcoins had been spent on transactions by the users.
The report which was released stared that their database reveals that the extent of retail channel liquidation is widespread. Along with it, the use of the Lightning network is also higher than it expected.
In the medium term, as speculated, there will be more active use of LN, and along with it, the demand for BTC and its price will also increase.
Presently, the Bitcoin network is also processing up to 50 transactions per second. If you are exceeding this limit, it will also mean that the transaction fees will also increase.
Additionally, the report authors concluded it by telling that the use of a second-level solution, for example, the Lightning, will also significantly reduce the transaction costs and also reduce fees reports.