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The rapid expansion of Bitcoin's secondary protocol, the Lightning Network, is evident as its growth rate skyrockets to an estimated 1,210% in the last two years. August of this year alone saw approximately 6.6 million routed transactions, a substantial increase from the 503,000 transactions reported in the same month the previous year, according to figures provided by the exclusive Bitcoin exchange, River.
Sam Wouters, a research analyst at River, shed light on these findings in a report released on October 10. He noted that this surge in transactions, which involves more than two nodes for the transfer, occurred even though Bitcoin’s value experienced a 44% drop and its online search popularity diminished.
Countering the critics of the Lightning Network, Wouters remarked that arguments against its usage have lost credibility. River's statistics, indicating 6.6 million Lightning-routed transactions, stand as a conservative estimate. The data for the 503,000 transactions in August 2021 was sourced from a prior study by K33, previously known as Arcane Research. River clarified that it couldn't evaluate private Lightning transactions or transfers involving only two participants.
Furthermore, the transaction volume on the Lightning Network for August 2023 reached $78.2 million, a stark rise of 546% from the previous year’s $12.1 million, based on K33's data. Wouters pointed out that at least 47% of all Bitcoin on-chain transactions are now being processed by Lightning. He further emphasized its significance as a measure of Bitcoin's evolution into a more widely used currency. For context, in August 2023, the typical transaction size on the Lightning Network was approximately 44,700 satoshis, equivalent to $11.89.
River's insights also reveal that the number of active Lightning users in September ranged from 279,000 to 1.1 million. They credited a notable 27% of the transaction growth to sectors like gaming, social media tipping, and live streaming.
As for the success rate of Lightning payments, River boasted a remarkable 99.7% success rate for their 308,000 transactions in August 2023. A primary cause for any failed transactions was the unavailability of a payment route with sufficient funds.
River's dataset captured 2.5 million transactions, representing significant portions of the network's capacity and payment channels.
