Over 80% of respondents to an online poll believe that Lightning isn’t real bitcoin (BTC).
The poll, which asked thousands of X users whether or not Lightning was succeeding as BTC, sparked lively debate on the platform over the weekend and saw supporters like Alex Gladstein and Matt Corallo go to bat for Lightning against critics, including Paul Sztorc.
Lightning is the largest and most sustained attempt to bring down bitcoin (BTC) transaction fee costs.
Indeed, unlike the expensive on-chain transaction fees for BTC that could cost hundreds of basis points for small, day-to-day transactions, Lightning transaction fees often cost tiny fractions of one cent.
The network was promoted for years as the cheapest way to send and receive BTC while maintaining full self-custody. However, despite growing rapidly from 2019 through 2022, it’s stalled for the past three years.
Sztorc claimed that the results speak for themselves. “Lightning seems cool at first — but after year six you realize it doesn’t work,” he concluded.
He also pointed to Lightning’s shortcomings, such as the requirement for nodes to maintain their internet connection or users’ reliance on large liquidity providers and watchtowers.
He then called the Bitcoin Lightning community a “cult” and concluded that it’s custodial.
Defending the Lightning network
Disagreeing, Gladstein called Sztorc’s comments “truly amazing” and reiterated his belief that Lightning enables the use of BTC for digital cash.
Also disagreeing with Sztorc, Corallo pointed to Lightning’s large transaction volume for small payments, estimating “well into double-digit percent of BTC transactions are now Lightning.”
He called deniers of Lightning’s success “disconnected from reality.”
Read more: Critics claim ‘buggy’ Bitcoin Lightning Network is slowly dying
Lightning payment channels have halved since 2022
Factually, many measures of Lightning’s network health have flatlined for years.
Total BTC capacity within the publicly-accessible network is approximately 4,800 BTC — the same amount as September 2022. The total number of Lightning nodes has also flatlined since March 2022.
Worse, payment channels within the Lightning network have nearly halved since March 2022 from above 80,000 to approximately 45,000 today.
Although they’re more centralized and involve more trust in centralized intermediaries, BTC-pegged or assets like Coinbase’s cbBTC and other wrapped products like spot ETFs dwarf Lightning transactions.
Udi Wertheimer pointed to the success of apps like Moonshot, Base, and Fomo that rapidly onboarded millions of users onto crypto and boast transactions in BTC-pegged assets that eclipse Bitcoin’s on-chain activity.
Of the thousands of voters in the social media poll, 80% agreed with the poll’s author that Lightning isn’t real BTC. The author called BTC within the Lightning network “a separate token on a separate network,” despite Lightning BTC having no distinct market capitalization from BTC itself.
Joining and exiting the Lightning network requires on-chain transactions to open and close payment channels, respectively.
Once a user has BTC within Lightning, they transact off-blockchain through a web of nodes who must stay honest about their state to avoid penalties in the form of justice transactions.
Many initiatives are underway to reduce the burden of channel opening and closing transactions for everyday users, such as splicing.
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Source: https://protos.com/lightning-network-gets-real-bitcoin-reality-check/
