The Lightning Network, Bitcoin’s second layer solution for faster and more efficient payments, was integral to the ecosystem’s third epoch — with a number of Lightning-focused projects iterating and expanding upon the technology to establish it as the most promising protocol built upon Bitcoin.
Further Reading: What Is the Lightning Network?
It became clear during Bitcoin Magazine’s BitcoinHalving.com live stream that this development is only poised to ramp up following Bitcoin’s third-ever subsidy halving. As leaders from the space’s Lightning-focused projects took the stage, they elaborated on the progress we’ve already seen from this relatively new technology and projected the evolutions that are to come.
As Elizabeth Stark, CEO of Lightning Labs, explained during her BitcoinHalving.com session, the story of the Lighting Network and that of Bitcoin’s third epoch are largely one and the same.
“In reflecting on the past Halving, the 210,000 blocks, that was really when the first Lightning development started,” she told moderator Colin Harper. “So much has changed since then, it’s been wild to see things evolve since the last Halving.”
But even though the Lightning Network has seen powerful development and significant adoption during its life between the second and third Halvings, there are some obstacles still to be overcome. For Stark, this is first and foremost a question of bitcoin liquidity.
“With Lightning, you’ve got amazing speed, amazing scalability, very low fees, but you do have this liquidity aspect to Lightning,” she said. “You need inbound capacity in order to receive funds and, of course, you need funds outbound in a channel in order to send. So, to me, I see one of the challenges as ensuring that we have the proper liquidity.”
Stark and Harper went on to discuss the role of Lightning service providers, use cases beyond payments and more.