Binance Establishes Bitcoin Lightning Nodes For Enhanced Deposit And Withdrawal Services
Binance, a prominent cryptocurrency exchange, announced today that it has established Lightning nodes on the Bitcoin network. The goal of this move is to eventually provide Lightning-based Bitcoin deposit and withdrawal services to its users, as stated in a recent tweet. The exchange clarified that while they are actively working on integrating the Bitcoin Lightning Network for deposits and withdrawals, there is still significant technical work to be done before the integration is complete.
The Lightning network, often referred to as the “second layer” of the Bitcoin blockchain, is designed to expedite transaction times and reduce network congestion. It accomplishes this by establishing payment channels that facilitate off-chain transactions between users for a minimal fee.
In May, Binance announced its plans to integrate the Lightning network to simplify deposit and withdrawal processes for its users. This announcement came after Binance temporarily suspended Bitcoin withdrawals due to network congestion, which raised concerns among users about the exchange’s reserve funds.
Other exchanges, such as Kraken and Bitfinex, already provide Lightning network services to their users. Additionally, Coinbase CEO Brian Armstrong hinted in an April tweet that his exchange might offer Lightning network services in the future.
As of Tuesday morning, the Lightning network holds just under $145 million worth of Bitcoin intended for rapid payments, according to available data.
