The Lightning Network has experienced remarkable growth over the past two years, estimated at 1,212%, a new analysis shows.
In August 2023, there were approximately 6.6 million transactions routed through the network marking a substantial increase when compared to the 503,000 transactions in August 2021. This data is sourced from the Bitcoin-exclusive exchange, River.
The reported figure of 6.6 million Lightning Network transactions routed by River represents a conservative estimate, indicating the minimum value that can be ascertained.
The company also obtained the figure of 503,000 for August 2021 from a study conducted by K33. It’s important to note that River’s assessment does not cover private Lightning transactions or transactions that involve only two participants.
In August 2023, Lightning Network processed a transaction volume of $78.2 million, reflecting a remarkable 546% surge from the figure of $12.1 million in August 2021, which was originally sourced by K33.
According to Rivers research analyst, Sam Wouters, Lightning is now processing at least 47% of Bitcoin’s on-chain transactions.
“This will be an interesting metric to monitor,” he added.
“It is an indicator of Bitcoin becoming more of a medium of exchange.”
Imagine betting against this chart…
Lightning's growth has been astounding, but often overlooked in the world of #Bitcoin
Read our new report on why it’s time to start paying attention to the Lightning Network 👇 pic.twitter.com/McgANOvq6T
— River (@River) October 10, 2023
During August 2023, the typical Lightning transaction had an approximate size of 44,700 satoshis, equivalent to $11.84. River’s estimate suggests that there were between 279,000 and 1.1 million active Lightning users in September 2023.
The company attributed 27% of the transaction growth to the gaming, social media tipping, and streaming industries.
According to River, their platform achieved a 99.7% success rate for Lightning payments in August 2023, based on 308,000 transactions. The primary cause of payment failure typically occurs when a suitable payment route with sufficient liquidity cannot be located to facilitate the transfer.
River’s dataset encompassed 2.5 million transactions. Within their dataset, the nodes represented 29% of the total network capacity and 10% of the payment channels.
26 exchanges have integrated Lightning since 2018. Coinbase intends to integrate it, but there are still many exchanges that haven’t announced anything. 70-80% of people hold their Bitcoin on exchanges, Rivers added.
In recent months, we’ve seen the major global exchanges decide to adopt Lightning payments as part of their systems. This was started by Binance which announced in July 2023 that Binance users can now use the Layer-2 scaling solution for Bitcoin withdrawals and deposits.
In September 2023, Coinbase also reiterated that it was working on integrating the Lightning Network for its clients.
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