After the latest congestion caused on the Bitcoin blockchain (BTC) by the BRC-20, Binance had indicated that it wanted to integrate the Lightning Network. With the exchange back on the subject earlier this week, let’s see how work is progressing, and what this will change for users.
Binance’s work on the Ligthning Network is progressing
With each period of heavy use of the various blockchains, centralised platforms face challenges in processing withdrawal requests properly. At the beginning of May, Binance was confronted with this problem, when BRC-20 madness took hold of the Bitcoin (BTC) network, leading the exchange to temporarily suspend withdrawals.
When network fees soar, centralised platforms can lose money processing their customers’ transactions, which can lead to such measures.
To counter this problem with BTC withdrawals, Binance had indicated that it was exploring the possibility of integrating Bitcoin’s Lightning Network. On Tuesday, it confirmed that this was indeed in development, after several observers had asked about certain nodes that could be those of the exchange:
Binance is working to integrate the Bitcoin Lightning Network for deposits and withdrawals.
Some eagle-eyed users spotted our new lightning nodes recently. Yes – that’s us!
However, there’s still more tech work to be done. We’ll update once Lightning is fully integrated. https://t.co/N0oN8561sN
– Binance (@binance) June 20, 2023
What will this change for users
As layer 2 of the Bitcoin network, the Lightning Network allows users to benefit from very low transaction fees, coupled with particularly high transaction speeds. As a result, this solution is regularly promoted as a means of payment.
As for Binance users, they will be able to deposit and withdraw BTC on and from the platform via this option, taking advantage of the benefits described above. This should help to reduce congestion during periods of high network usage, as is particularly the case during days of increased volatility on the cryptocurrency market.
On the Amboss explorer dedicated to the Lightning Network, we can find a node identified as Binance, with a capacity of 30 BTC. The node in question is currently connected to 5 channels, 2 of which belong to Kraken for example:
Binance nodes with a capacity of 30 BTC on the Lightning Network
For the time being, however, Binance is still working on this and has not yet given a release date.
“However, there is still some technical work to be done. We will provide updates once Lightning is fully integrated “
In April, Coinbase CEO Brian Armstrong also indicated that his platform would support Bitcoin Layer 2 in the future.
