We had a great time at the first Lightning Conference in Berlin earlier this month where we launched Blockdaemon support for Lightning nodes.
We’re ecstatic about the potential of Lightning to ease the burden of on-chain transactions for Bitcoin and the timing feels right for proper enterprise tooling for Lightning nodes as Enterprise adoption is starting to grow.
Why Exchanges should Love Lightning
In this early phase of adoption, we see exchanges and payment providers being the first to benefit from Lightning. Lower fees and instant withdrawals make Lightning transaction much more efficient than on-chain transactions. As exchanges account for nearly 50% of all Bitcoin transactions, there are enormous benefits for individual exchanges as well as Bitcoin overall in using Lightning. Fee savings could potentially be in the billions this year alone, and Bitcoin block size would nearly half. In addition, privacy would be improved since not every transaction would be on-chain.
From the Lightning network perspective, larger hubs don’t necessarily lead to more centralization. The architecture of the Lightning network is such that the net flow of money is near zero, which means fees are low and running a hub is barely profitable over time. In combination with the zero barrier to entry, there will likely be many new hubs circulating in and out of the network.
Exchanges also benefit Lightning by bringing liquidity. Channel life-cycle needs to increase toward an infinite amount of transactions, and exchanges will make that possible, removing the last adoption bottleneck.
So why do exchanges need to participate in the Lightning network? They need all the same things from Lightning that we currently provide to exchanges for our types of nodes:
- 99.99% uptime and multiple nodes for redundancy
- Security (SOC2 compliance) and HSM for hot keys
- Adding and deleting nodes as needed for load-balancing
- Data — ability to query the node
- Tooling to manage liquidity (i.e never having to think about rebalancing the channel)
How to Run Lightning Nodes on Blockdaemon
Our Lightning offering is nearly complete, and we’re already running a high-performing hub:
You can see our routing performance here and use it here:
We also offer a platform-dedicated Bitcoin node for $149 per month (the first product of its kind):
- Choice of cloud and geo.
- The LND daemon auto-installed.
- The RTL Dashboard for Lightning administration.
- Platform standard monitoring to ensure high uptime.
- API Access to your node — NO LIMITS.
In addition, we have additional features to offer exchanges and enterprises exactly what they need:
- Rich monitoring UI with detailed data about node health & performance
- Launch on-premise or in your own cloud easily with BPM – Blockchain Package Management
- More control over configuration and optional add-ins via the Blockdaemon marketplace – e.g. btcpay server as an optional add-on
- Additional administration dashboards & tools
Stay tuned for our latest Lightning implementation and look out for our Marketplace launch that will offer additional third party solutions.