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Bitcoin Lightning Network Reaches New All-Time Capacity High as Adoption Grows

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Amin Ayan

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Bitcoin’s Lightning Network has climbed to a new all-time high in capacity, signaling renewed momentum for the layer-2 payments network after a long period of stagnation.

Key Takeaways:

  • Lightning Network capacity hit a new all-time high above 5,600 BTC, reversing a year-long decline.
  • Growth is being driven by more Bitcoin flowing into existing channels, not by an increase in nodes or users.
  • Large exchanges and institutional players, rather than grassroots adoption, are leading the latest capacity surge.

Data from Bitcoin Visuals shows that Lightning capacity reached 5,606 BTC on Monday, surpassing its previous record set in March 2023.

Separate figures from Lightning analytics platform Amboss put the peak slightly higher, at 5,637 BTC, worth roughly $490 million at current prices.

Lightning Network Capacity Rebounds, but User Growth Lags

The increase follows a noticeable rebound in November and December, after capacity trended lower for much of the past year.

The data suggests that more Bitcoin is being committed to Lightning payment channels, allowing for faster and cheaper transactions compared with on-chain transfers.

However, the growth in capacity has not been matched by a similar rise in network participation.

As of this week, the number of Lightning nodes stood at around 14,940, down from a peak of more than 20,700 in early 2022.

The number of channels connecting those nodes has also declined to about 48,678, well below its previous high.

This gap points to a network that is becoming more capitalized, but not necessarily more widely used by individual operators.

According to Amboss, the recent capacity jump is being driven less by grassroots growth and more by institutional players.

“It’s not just one company that’s putting more Bitcoin into the Lightning Network; it’s across the board,” the firm said, noting that major crypto exchanges such as Binance and OKX have added significant amounts of BTC to Lightning channels in recent weeks.

Broader developments in the Bitcoin ecosystem may also be supporting renewed interest in Lightning.

Stablecoin issuer Tether announced this week that it led an $8 millionfunding round in Lightning-focused startup Speed, which aims to enable stablecoin payments over the network.

While stablecoins largely operate on other blockchains today, some developers see Lightning as a potential settlement layer.

Lightning Labs Upgrades Taproot Assets to Enable Stablecoins on Bitcoin

At the protocol level, Lightning Labs said it has rolled out version 0.7 of Taproot Assets, an upgrade that introduces reusable addresses, auditable asset supplies and more reliable large transactions.

Taproot Assets allows assets such as stablecoins to be issued on Bitcoin and transferred over Lightning, combining Bitcoin’s base-layer security with near-instant settlement.

“With this release, we are laying the foundation for trillions of dollars to flow on Bitcoin and Lightning,” Lightning Labs said, pointing to a longer-term vision of Bitcoin evolving into a multi-asset network.