According to recent data, the number of bitcoins locked in the Lightning Network (LN) has increased threefold from 1089 BTC in 2021 to 3479 BTC. The locked bitcoins are worth £0.96 billion at the moment.
The potential of the LN to allow rapid and cheap transactions on the Bitcoin network is the driving force behind the triple increase in total bitcoins locked.
The Lightning Network facilitates off-chain transactions on layer 2 of the Bitcoin network. The Lightning Network allows two nodes to communicate across a channel, deferring subsequent settlements to the main network. Off-chain transactions that are frequent and small help the Bitcoin network’s scalability and utility.
As bitcoin’s capacity grows and more people use it to deal in BTC, the Lightning Network has the potential to catalyse an increase in its day-to-day utility.
Last year, Twitter released Tips, which included Strike integration. Strike enables no-fee cross-border bitcoin payments and transactions. Mayor Francis Suarez of Miami has started taking bitcoin as salary through Strike, while El Salvador’s use of bitcoin as legal tender has aided the growth of Lightning Nodes.
Strike’s partnership with the government of El Salvador resulted in a 46 percent boost in network capacity just two months after the announcement. This resulted in the addition of 15,000 new nodes to the LN as well as 1,500 bitcoins.
On January 12, 2022, Strike launched limited payment capability in Argentina. CashApp, a payment service provider, said in late January that it would roll out LN to over 30 million clients in the US and the UK. The Lightning Network has capably handled the increase in nodes, which throws light on its future scalability.
The popularity of the Lightning Network is being fueled by a bullish mindset. Despite the fall from its all-time high of over £50,700 in November last year, the Lightning Network’s growth could imply prospective bullish feeling on bitcoin’s price bouncing back up.
Bitcoin could see another bull run in 2024, according to experts.