Since Lightning Network was proposed in 2016, a few years have passed, and people have been talking about it all the time. What is the real situation of Litecoin's Lightning Network now?
What is Lighting Network?
Lightning network (LN) is a layer-2 payment solution on top of the Bitcoin/Litecoin blockchain that enables instant and cheap Bitcoin/Litecoin payments. Proposed by Joseph Poon and Thaddeus Dryja in 2016, LN has gained a tremendous amount of attention and developments in the past few years because it provides a good way for solving Bitcoin/Litecoin's scalability, confirmation time, and cost issues together. For more info on what it is and how it works, please check our brief introduction.
Who are developing Lightning Network?
There are now four major implementations of LN: lnd, lightning, eclair, and lit. The first three together built the Basis of Lightning Technology (BOLT) standard and can talk to each other.
Multiple implementations make the Lightning Network robust to bugs, i.e., when one implementation fails, the rest could still be online. The following table gives comparisons:
BOLT compatible Language Team
lnd Y Go Lightning Labs (US)
c-lighting Y C BlockStream (Canada)
Among the four projects, lnd seems the one with the best progress and actively maintains both Bitcoin and Litecoin support. It is also backed with $2.5M by some high-profile investors including:
- Jack Dorsey, CEO of Square and Twitter
- David Sacks, former COO of PayPal
- Bill Lee, angel investor in Tesla and SpaceX
- Jacqueline Reses, head of Square Capital
- Charlie Lee, creator of Litecoin
Although the other three implementations do not support Litecoin directly, due to the high similarity between Bitcoin and Litecoin, it should be easy to modify or configure those projects to support Litecoin.
For example, someone has successfully run eclair on Litecoin by simply changing of some parameters.
Is Lightning Network easy-to-use now?
Lightning Network is still in its early stage, and using it requires a certain level of technical skills.
Is it easy to setup a Litecoin Lightning Network node?
To use Litecoin LN, the first step is to setup a LN node, which is preferably lnd because it supports Litecoin out of the box.
The easiest way is to buy a Raspberry Pi and a LCD and install the open-source software system RaspiBlitz. According to Charlie Lee's tweet, it is fairly easy to setup and use, and of course, it is given that he has a Bachelor's and Master's degree in Computer Science.
If you have no Raspberriy Pi, you can check ecurrencyholder's step-by-step tutorials on how to setup a Litecoin LN node for both Mac and Windows.
Are there any nice graphical user interfaces for Litecoin Lightning Network?
Once you setup the LN node, you can use the lnd command line program, on which Lightning Labs has a comprehensive tutorial. However, people have developed much easier to use graphical user interfaces (GUIs).
As far as I know, the best GUI should be Zap developed by Jack Mallers as shown below. The desktop app can be directly downloaded from the website, while the iOS version has to be downloaded through testflight. The interface looks very slick.
LightningJoule is a browser plugin that connects to a LN node to enable easy payments through browsers, which could enable seamless web-based LN payments. Although it does not support Litecoin for now, the Litecoin part has been added to the code repository waiting to be released.
Are there any interesting applications?
Because setting up a LN node is still not easy to most people, LN has a limited number of users. However, people are exploring different interesting applications and some have already gotten real usage.
LitoshiSpace.com, which is Satoshi.Place for Litecoin, allows you to draw on an image seen by everyone visiting the website by paying a small amount of Litecoins through Lightning Network for the number of pixels you use.
BitRefill is a convenient service for people to top-up pre-paid mobile numbers or buy gift cards from more than 1650 businesses in 170 countries. The user experience of topping up a pre-paid number in Singapore is very smooth.
Boltz.exchange is a fully decentralised platform based on LN for you to exchange between Bitcoin and Litecoin. Currently, submarine swaps are supported so you can use an on-chain Bitcoin/Litecoin transaction to pay an off-chain LN invoice, or an off-chain LN transaction to pay to an on-chain address, which is a reverse submarine swap. But there is no atomic swap between Litecoin LN and Bitcoin LN yet. An interesting thing is if you go to the website using a browser installed with Joule, a popup will show up for you to connect between Boltz and Joule.
Sparkswap is a cryptocurrency exchange based on LN that can change between Bitcoin and Litecoin through Lightning Network based atomic swaps, which the Boltz.exchange still lacks as mentioned above. Sparkswap is an open-source software based on lnd. To use it, both Bitcoin and Litecoin LN nodes need to be installed, which occupy about 250 GB disk space at this moment. According to CoinDesk, they were invested with a $3.5m seed fund led by Pantera Capital.
Unlike centralised exchanges, Sparkswap does not keep users' private keys. And unlike current prevalent blockchain based decentralised exchanges, Sparkswap can handle much more orders per second. Therefore it combines the best part of centralised and decentralised exchanges.
The following show a screenshot of their current orderbook. It contains only the BTC/LTC pair and still lacks liquidity.
Can merchants accept Lightning Network payments easily?
Merchants may join this space early. To accept LN payments, two payment gateways can be used: CoinGate and BTCPayServer.
CoinGate, based in Lithuania, provides services to merchants for easily accepting different types of cryptocurrencies and both Bitcoin and Litecoin LN payments. A small proportion of fees are deducted from each payment as the revenue of the company.
BTCPayServer is an open-source and free payment gateway that supports both Bitcoin and Litecoin and their LN payments. To use it, you have to host your own BTCPayServer, which can be technically challenging but may reduce your costs and give you full control, privacy, and better security.
How many people are using Litecoin's Lightning Network?
Currently, there are about 182 Litecoin LN nodes, and 1285 channels. The total network capacity is 288 LTC. The numbers are small but growing fast. In the past 30 days, the number of nodes has increased by 12.35% , the number of channels 24.5%, and the network capacity 102%.
The following shows the statistics of the Bitcoin network. Bitcoin's nodes and channels grow a bit faster than Litecoin's. The network capacity, although much larger than Litecoin's, grows significantly slower.
Lightning Network is an extremely promising way of solving many problems of the Bitcoin/Litecoin blockchains including the scalability issue, long confirmation time, high fees, and micropayments.
Although still in its infancy, Litecoin's Lightning Network is growing fast. We believe the most important task to be finished is to improve the user experience, which is also the most important to many other technologies in the crypto space.
Thanks to ecurrencyholder for his comments. He has been consistently working on educating people on Litecoin and Lightning Network through The Litecoin School.