Bitcoin Lightning Network adoption has been on the rise for some time. This was particularly evident during the many bull rallies of 2021. This triggered an accelerated rate of adoption. Thus the network congestion increased due to the arrival of all new users. Naturally, transaction fees went up while confirmation times slowed down. The Lightning Network preferred the solution for not only being faster but at the same time being cheaper.
Capacity ATH . grows up to
By this time last year, the capacity of the Bitcoin Lightning Network was around 1,000 BTC. Mostly because users were still comfortable transacting on the bitcoin network and the confirmation times were reasonable. However, with mass adoption came the need for more capacity. The move to the Bitcoin Lightning Network was accelerated by significant events in the space such as El Salvador making the cryptocurrency legal tender.
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Since then, the evolution of the Bitcoin Lightning Network has been evident. By December 2021, the capacity of the Lightning Network had more than doubled to sit above 3,000 BTC. Being a layer 2 solution, it was predicted that its capacity would peak and begin to decrease but this would not happen.
By April 2022, the capacity of the Lightning Network had exceeded 3,600 BTC. Since it allows users to make micro transactions with very low transaction fees, more users are opting to use the Lightning Network for their transactions, hence a 9% increase that was recorded in less than two months. Has been.
Lightning network capacity reaches new high | Source: Arcane Research
As of June 5, Bitcoin Lightning Network capacity was sitting at 3,950. This growth rate indicates that more bitcoin users and investors are choosing to use layer 2 solutions to conduct off-chain transactions.
More in Store for the Bitcoin Lightning Network?
The Bitcoin Lightning Network has been around for a while and like a lot of Layer 2 roll-up solutions, it has taken some time to catch on. However, what has been observed with such solutions is their accelerated growth rate once they have been tried and tested by users in the space.
BTC price recovers above $30,000 | Source: BTCUSD on TradingView.com
This is really evident in the development trend of power network. Even after bottoming out at the beginning of the year, it has been able to back up, with a growth of 6% in the month of May alone. This is the fastest growth rate recorded since October 2021. This also translates to a 100% annual growth rate in electricity network adoption.
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Although bear markets are affecting bitcoin adoption, those already in the space continue to look to other ways to conduct cheap transactions. If last month’s growth is anything to go by, power network capacity could be ready for another run recorded in the summer of 2021.
Featured image from The Coin Republic, charts from Arcane Research and TradingView.com
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