The Bitcoin Lightning network is being used more and more intensively. This was especially evident during the 2021 bull run. This resulted in a more rapid increase in adoption, leading to network congestion. The reason: the massive influx of new users. Of course, transaction fees increased and assurance times slowed. The Lightning Network offers a solution to this problem – it is not only faster but also cheaper.
Lightning Network: Capacity hits record high
The Lightning Bitcoin network capacity was around 1,000 BTC this time last year. This was mainly because users were still familiar with the Bitcoin network and the confirmation times were reasonable.
However, when it was widely accepted the need for additional capacity arose. The transition to the Bitcoin Lightning Network has been accelerated by major events in this space. These include, for example, the introduction of cryptocurrency as legal tender in El Salvador.
Since then, the growth of the Bitcoin Lightning Network is incomprehensible. As of December 2021, Lightning’s network capacity has more than doubled from more than 3,000 BTC at the time.
Because it was a Tier 2 solution, many people speculated that capacity would peak and then decrease. That was not the case, however.
By April 2022, the capacity of the Lightning Network had already increased to more than 3,600 BTC. Because it allows to perform microtransactions with very low transaction fees, more and more users are choosing to use the Lightning Network for their transactions. This explains the 9% growth in less than two months.
On June 5, Bitcoin Lightning network capacity was 3,950. This growth rate indicates that more and more Bitcoin users and investors are using Tier 2 solutions to make transactions off the blockchain.
How will the Lightning Bitcoin Network Develop?
The Bitcoin Lightning Network has been around for a while now. And like many other Tier 2 rolling solutions, it took some time to continue.
However, what has been noticed with such solutions is the accelerated growth rate as soon as they are tried and tested by users in this field.
This is also reflected in the growth trend of the Lightning network. After a breakout earlier in the year, the Lightning network has bounced back, growing 6% in May alone.
This is the fastest growth rate since October 2021. This represents a 100% CAGR for Lightning Network uptake.
While the bear market has hurt Bitcoin adoption, those already in space continue to look for other ways to conduct cheap transactions. If last month’s growth is worth it, Lightning Network’s potential could be directed to another run – one similar to the one in the summer of 2021.
Text credit: Bitcoinist
Last updated June 9, 2022
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