The XRP cryptocurrency is talking about it despite the fact that the Lightning Network network (Bitcoin) has long made it useless…
XRP, always the same catchphrase
Managed by the XRPL Foundation, the XRP (Ripple) is yet another cryptocurrency that has made its butter by prevailing a much more important transactions than that of Bitcoin.
Carrying out cheaper and faster transactions has always been the main sales argument for thousands of cryptos that are created every year. Propaganda is well put together, even revealing some that Bitcoin would be a “outdated” technology.
Obviously not. It is quite the opposite. To understand this, we must talk about the famous Blockchain trilemma and then the lightning network.
This trilemma refers to the impossibility of maximizing the three essential aspects of Blockchain technology: Safety, decentralization and transaction debit. Clearly, the optimization of one aspect is done at the expense of others.
Bitcoin favors decentralization at the cost of a relatively low transactions of seven transactions per second. It is 1,500 transactions per second for Xrp.
Decentralization is measured by the number of nodes. It is directly proportional to the size of the blockchain (630 GB currently) whose growth overcome the cost of installing a node (hard drive, RAM, bandwidth, etc.).
Ensure that the network remains decentralized requires small blocks and therefore a limitation of the number of transactions they contain. The limit of 1 MB per block is the cornerstone of this design.
This limit was fiercely defended during the “Blocksize War”. At the time (2017), some wanted to sacrifice decentralization on the altar of the transaction debit, without success. The reluctance led to Fork Bitcoin Cash (BCH).
The patent failure of the BCH shows that the main attraction of Bitcoin is to be a truly decentralized and secure reserve of value rather than a means of payment. That said, the creation of Lightning Network offers us both.
Pay your coffee in Bitcoin
The Lightning Network (LN) tenfold the transaction flow while preserving the safety of Bitcoin. It is a secondary network firmly attached to the Bitcoin network via the opening of open “channels” thanks to what is called HTLC (hash time lock contract).
Transactions are faster, cheaper and more confidential. The LN is perfect for small payments that can be as small as Satoshi, or 0.00000001 BTC (0.001 Euro). This allows for example to distribute micro-pourboires online. Or even pay for a few seconds of use of an internet service (streaming) without having to subscribe.
And all that instantly. If the Bitcoin network propagates blocks at around ten minutes, the Lightning Network achieves transactions in the moment. Once the BTCs have been attached in a channel (via a “on-chain” transaction), payments are made in real time and almost for free.
The LN can theoretically manage millions of transactions per second. The costs are significantly lower than those of the on-chain transactions which can soar in the event of congestion of the network. The fees are calculated in milli-satoshis. That is to say a thousandth of Satoshi.
But isn't Satoshi already the smallest unit? Absolutely, but the LN works with even smaller units. The amount is rounded up to the lower Satoshi when the canal is closed via a second on-chain transaction.
Like the Bitcoin network, the Lightning Network also works via a decentralized network of nodes transporting payments. The routing is also dynamic, which guarantees that the cheapest paths are chosen to transport payments to the four corners of the Internet.
A network that grows slowly but surely
Since its launch in 2018, Lightning Network has experienced exponential growth, which has however been silent for two years. At the end of 2024, the network hosted fifteen thousand nodes. There are about fifty thousand active channels collectively displaying a capacity of 5,000 BTC, the equivalent of $ 500 million.
The LN network is an open-source project with several interoperable implementations such as LND, Core Lightning or Eclair. They coordinate thanks to a set of standards described in Bolt (Basics of Lightning Technology) whose philosophy is the same as with the Bitcoin network.
The most popular Wallets LN are French Phoenix or Breez. Several exchange platforms such as Bitfinex, OKX, Binance or Kraken have integrated it. This allows their customers to deposit and remove BTC via the Lightning channels and avoid paying significant costs during congestion periods.
Adoption of Lightning Network by merchants continues to move forward. Note for example Bitrefill, an important retailer of Bitcoin gift cards. Or OpenNODE, a payment processor that allows the more than 500,000 traders (e.g. Shopify) to accept LN payments.
The icing on the cake, LN transactions are very confidential. Their trip by many channels before reaching their destination makes them intrinsically private. This is the big difference with the Bitcoin network where all transactions are public.
Lightning payments only reveal the sender and the recipient to the parties directly concerned. Thus, rather than going through a corner, making many transactions to yourself on the LN allows you to erase your traces.
In other words, the LN makes cryptocurrencies to the flow of high transactions unnecessary, but also those who, like Monero (XMR), bet on confidentiality to stand out. As such, it should be noted that the Finnish police have reached Return monero transactions…
In short, the lightning has reduced the reason for thousands of cryptocurrencies which are only used to enrich their creators. For example, those of XRP have allocated no less than 100 % of the XRP that they gradually resell to lovers of Pump & Dumps…
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