According to a report from the Bitcoin-only exchange River, increased Lightning utilization will play a significant role in Bitcoin’s evolution into a superior medium of exchange.
According to data from the Bitcoin-only exchange River, Bitcoin’s layer 2 Lightning Network has grown by an estimated 1,212% in the past two years, with approximately 6.6 million routed transactions in August, a significant increase from August 2021’s 503,000 transactions.
River research analyst Sam Wouters explained in an Oct. 10 report that the increase in routed transactions — which employ more than two nodes to accomplish a transfer — occurred despite a 44% drop in Bitcoin’s price and significantly decreased online search interest.
“‘Nobody is using Lightning’ should now be a dead meme,” Wouters wrote in a follow-up X (Twitter) post on Oct. 10, aiming at Lightning critics.
River’s estimate of 6.6 million Lightning-routed transactions is a minimum — the smallest conceivable value it could assess.
The firm also obtained the 503,000 figure for August 2021 from a 2021 study by K33, formerly Arcane Research, and added that it was unable to evaluate private Lightning transactions or those involving only two parties.
In August 2023, Lightning processed $78.2 million in transaction volume, a 546% increase from August 2021’s $12.1 million, as reported by K33.
Wouters noted that Lightning now processes at least 47% of Bitcoin’s on-chain transactions.
In August 2023, the average quantity of a Lightning transaction was approximately 44,700 satoshis, or $11.84.
“This will be an interesting metric to monitor,” he added. “It is an indicator of Bitcoin becoming more of a medium of exchange.”
River estimated that between 279k and 1m Lightning users were active in September.
The company attributed 27% of its transaction growth to the gaming, social media tipping, and streaming industries.
In August 2023, River reported a 99.7% success rate for Lightning payments on its platform across 308,000 transactions.
The primary cause of failure is the inability to locate a payment route with sufficient liquidity to effectuate the transfer.
The data set for River contained 2.5 million transactions. The nodes in River’s data set account for 29% of the network’s total capacity and 10% of payment channels.
