Today, Lightning Network development firm Lightning Labs has released a peer-to-peer, non-custodial marketplace called Lightning Pool, where Lightning node operators can buy and sell access to channel liquidity.
The marketplace is a way for node operators in need of inbound liquidity to pay node operators with that liquidity to open channels in their direction.
“Users can buy or sell Lightning channels, the equivalent of tubes of money, via the Pool marketplace,” as described in a Lightning Labs announcement shared with Bitcoin Magazine. “Merchants and startups who want to receive funds on Lightning are natural buyers of channel liquidity, and node operators with spare capital looking to earn a return on their bitcoin are natural sellers.”
A Marketplace For Lightning Liquidity
The Lightning Network is effectively a network of payment channels that enable faster and cheaper bitcoin transactions by settling balances between users on the underlying Bitcoin network only when these channels close. Lightning node operators process transactions through these channels and collect fees for doing so.
To transact bitcoin on the Lightning Network, you have to convince other nodes to lock up bitcoin in channels with you. Lightning Pool has been launched as a solution for users seeking participants with available BTC to create channels with.
“We developed Pool out of a need in the market that emerged from Lightning users who were looking for new sources of liquidity to enable them to more efficiently receive funds and transact on Lightning,” per the announcement. “Users attempted to solve this problem in a variety of ad hoc ways, such as chat groups and OTC services, and Pool provides a solution that enables all of them to participate.”
Node operators who do have access to liquidity can now get paid to allocate it to the highest bidders.
“Existing node operators do not have access to pricing signals to help…