The Lightning Network continues to expand. The capacity of public channels has reached a new record, exceeding 5,600 BTC, despite a marked decline in the number of channels. This is a strong signal of Bitcoin’s adoption as a means of payment.
The Lightning Network continues its adoption: slowly but surely
The Lightning Network, an instant and inexpensive payment solution built on top of Bitcoin, has just reached a new high: the capacity of public channels now exceeds 5,633 BTC, or nearly $500 million.
This historic record confirms the continued momentum of Bitcoin’s adoption as a means of payment. However, we are also seeing what appears to be a gradual centralization of the network.
First, it is important to remember that the majority of Lightning Network adoption, as evidenced by the opening of new channels and nodes, is actually happening privately, i.e., outside of on-chain data.
As a result, the metrics available to measure Lightning Network adoption are partial and potentially misleading. The recent wave of adoption by individual users, which began 1 or 2 years ago, largely escapes traditional measurement tools.
In addition, due to the relative complexity of channel management, a significant portion of this adoption goes through trusted third parties such as custodial wallets like Wallet of Satoshi or Blink, as well as solutions that integrate Lightning via the Liquid network, such as BULL or Aqua wallets, which simplify the user experience by requiring only the management of a private key.
On the public data side, there has been a sharp decline in the number of public channels, from 82,000 in 2022 to 42,000 today, while their total capacity has increased. This indicates a growing concentration of liquidity in a smaller number of channels.
At the same time, the number of public nodes is on the rise, with a 32% increase since November 2024, from 11,900 to over 17,500 nodes today, approaching its all-time highs and contradicting suspicions of centralization.
Finally, even if the Lightning Network’s liquidity were to be concentrated in the hands of a small number of nodes, they would not be able to completely censor payments or steal funds, since each channel remains secured by a private key held by each of the two peers, whose funds can be unilaterally withdrawn on-chain.
Does Gresham’s Law prevent Bitcoin from becoming a medium of exchange?
Some critics of Bitcoin argue that BTC will never be adopted as an everyday currency, particularly because of Gresham’s Law.
This law states that “bad money drives out good money,” meaning that when an individual holds both a weak currency and a strong currency, they will tend to spend the weak one and carefully save the strong one, without ever using it. Applied to a European Bitcoin user, this would mean that they would always prefer to spend their euros and keep their Bitcoins.
However, Gresham’s law only really applies in a context of state obligation, when acceptance of the weak currency is imposed by its status as legal tender. Indeed, when we are required by law to accept this currency, it is the one we have in our pockets ready to be spent.
However, when confidence in this currency collapses, due to inflation, mistrust of the banking system, or the risk of default by the issuing government, economic actors naturally turn to stronger monetary alternatives.
Even without a global collapse of the currency, once an economic actor has the option of accepting payments in a strong currency, they will naturally tend to favor it.
They may even discourage the use of the weak currency by applying an additional cost, as is already the case in some Asian countries where credit card payments incur additional fees.
If you are still not convinced, take the example of Argentina, where the population, faced with high inflation, naturally turned to the dollar, which is perceived as strong compared to the peso. Or Nigeria, where the population rejected the digital naira in favor of alternatives such as Bitcoin, stablecoins, or the dollar, fleeing the weak currency imposed by the state. In this context, accepting payments and managing cash flow in hard currency becomes a means of hoarding: a way to preserve value while remaining liquid.
This phenomenon is already being observed among individuals, businesses, and even some governments, which are choosing to save in Bitcoin and use it to pay whenever possible.
This dynamic reinforces Bitcoin’s role not only as a store of value, but also as a functional currency in the real economy, returning to a gold standard system abandoned in the last century due to technological limitations from which Bitcoin can break free thanks to the Lightning Network.
