The growth of the Bitcoin Lightning Network is due to its adoption in the real world
Ever since the launch of US dollar payments and the decentralized social media platform Nostr, there has been an increase in the adoption of the Bitcoin Lightning Network (LN) around the world. This ascertains that the growth of the bitcoin lightning Network is due to its adoption in the real world.
Unlike many decentralized platforms (DeFi), the Lightning Network (LN) has no native coin as of this time. It was layered on top of Bitcoin with the purpose of enabling fast transactions.
However, the capacity of Bitcoin Lightning Network (LN) is at an all-time high of 5000 Bitcoins.
Furthermore, there is a positive indication of the Lightning Network (LN) development. Despite the fact that in DeFi contracts the Lightning Network’s liquidity is less than 0.5% of the Ethereum (ETH). The drop of the ETH locked in smart contracts and the upward trend of the Bitcoin Lightning Network LN capacity predicts and encourages the growth of LN.
After the FTX crashed in November, the number of channels on peer-to-peer networks significantly decreased, despite the fact that LN liquidity has been on the rise. This could be a result of the flight of miners to LN nodes apart from mining clients.
According to a report from Valkyrie Investments; due to the efforts of the mobile payment app Strike of LN, its adoption is rising in developing nations like Africa and South America.
The firm launched a remittance service based on LN in Africa in December 2022. This program provides free of cost transfer services to Africans in Kenya, Ghana, and Nigeria from the US. And afterward, Strike initiated a similar program in the Philippines.
Recently, they introduces dollar payments through LN, which allows users to possibly send dollars from their Strike’s cash balance to savings and Visa-enabled accounts. The strike app converts the US dollar into Bitcoin BTC in the background and then again converts it into dollars at the destination. Lightning Network (LN) is fast and affordable because of that there is a reduced risk of Bitcoin price volatility.
The fact that it is fast might attract the users to strike-based payments over traditional remittance channels as the per transaction cost of international payments from the US can reach up to $45 with transfers taking hours to even days.
A rise was observed in LN payments on one of the top lightning network wallets- the wallet of Satoshi – as per the report from Marty bent. In addition, a podcasting site called podcasting 2.0 that supports LN payments saw an increase in the tips given to the artists.
Nostr’s contribution to LN adoption
The Launch of Nostr is yet another reason for the adoption of LN. Nostr is a simple, open protocol that permits worldwide, decentralized, censorship-resistant social media as stated by the protocol’s GitHub page. Social media apps may be created using the protocol.
A Nostr-based social media Damus, Twitter rival, also offers iOS and android applications. With the pioneers of Bitcoin Jack Dorsey and Adam back actively endorsing Nostr, the notion of an open, free social media network resonates strongly in the crypto space.
Apart from their shared ideologies, Nostr can boost LN adoption as Damus has integrated a number of LN wallets like the wallet of a satoshi, Blue wallet, strike, and more. Around 600,000 people have joined Nostr, as reported by LN analyst Kevin Rooke. Given that Nostr supports the Bitcoin payment network with Nostr Zap, this may aid in drawing new users to LN.
Although the LN lacks a native coin, LN nodes might make money by processing transactions and providing liquidity. Nonetheless, The earnings are small, in their current form. consequently, it seems that the Lightning Network’s growth is organic, and it is in a good position to surpass other global payment networks, as well-known personalities in the industry have predicted.