Once upon a time, many considered that scaling Bitcoin (BTC) would be the next logical and developmental step. This had led to the eventual launch of Bitcoin’s Lightning Network back in 2018, and while it remained dominant for a time, it quickly became apparent that both the functionality and hype surrounding it slowly began to die down, and the layer-two payments protocol has since been deemed outdated. Matters were made worse when Ethereum (ETH) started gaining momentum and quickly rose to become the king of altcoins.
Furthermore, it was between February of last year and this year that the Lightning Network’s growth had become a bit stunted, as the overall capacity had only risen to 1,095 BTC from 886 BTC, indicating a growth of just 23% in one year. Regardless, it may do us some good to once again observe how things have changed and whether the protocol has managed to improve.
Are we witnessing a comeback?
Ever since this past March, the amount of BTC that has been stored on Bitcoin’s Lightning Network has increased. In fact, it had nearly doubled from around 1,095 BTC to 2,087 BTC at the time. Moreover, the nodes had also cumulatively doubled, with the tally going up 23,880. An abundance of channels had additionally been observed over on 1ml.com, with the total being risen to 60,978.
With all that in mind, if the Lightning Network manages to successfully sustain this growth rate, then the capacity of 10K BTC could very well be surpassed by March of next year.
How genuine is the growth?
If we were to look at the entire history of the Lightning Network, we could see that it had been developed for the purposes of facilitating faster as well as more affordable transactions. However, as time progressed, the competition had increased, and other cryptocurrencies are now offering the same service but with higher quality and better service. And meanwhile, Bitcoin’s Lightning Network remains comparatively much slower. As such, numerous BTC supporters felt as if there had not been any kind of substantial growth or improvement, and it would be hard to argue with this line of thinking too.
The act of El Salvador legalizing Bitcoin had slightly improved the situation by offering increased demand and exposure, but further expansion can only take place if other nations or perhaps global conglomerates start accepting BTC as payments, in addition to the Lightning Network desperately needing to become more effective and efficient as well.