Lightning Vs WBTC, Is It Game Over For Bitcoin Lightning Network?

Ketaki Dixit
September 29, 2020
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Lightning Network that was launched with the hope of enabling instant payments and scaling Bitcoin to handle millions to billion of transactions per second across the network. However, currently the Lightning Network appeared to be losing pace, especially when compared to Wrapped Bitcoin. 

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Lightning vs WBTC

The total value of Bitcoin locked in Ethereum via Wrapped Bitcoin [WBTC] has nearly tripled in a month. According to data provider Skew, the total value of BTC in WBTC was $353 million on 28 August, whereas, the current value stood at $952 million. Whereas Bitcoin on Lightning Network was struggling to surpass $12 million for months. 

Lightning is falling behind even as the network continued its efforts to upgrade and improve. According to Blockstream, the last update fro LN was released on 16 September that introduced across-the-board speedups, Multi-part payment fixes and refinements, and New ‘multifundchannel’ plugin. 

 

However, the growing interest in Decentralized Finance [DeFi] has channeled great interest from users to WBTC as its potential to provide massive returns.

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Lightning Network a failure? 

According to a prominent crypto investor, Roger Ver Lightning Network might just be a “total failure.” In a tweet comparing the total BTC locked in WBTC on ETH and LN, Ver noted that the difference was highlighting the “total failure” for scaling BTC on LN. 

Even though users claim WBTC to be better than LN, the value into the tokenized BTC may not be a reflection of the demand from users to transact on Ethereum. Rather, this could be a hype-driven exercise of DeFi. While WBTC is a centralized collaboration between Defi protocols like Maker, Compound, Kyber Network, and so on, LN was in a different league being decentralized and a permissionless layer. Making it difficult to draw parallels between the two. 

However, if the Bitcoin fees keep climbing higher, users may eventually switch to Lightning Network. Meanwhile, the tokenized versions of BTC continue to lead including Ren protocol’s renBTC that held 24% of the total amount of BTC represented on the ETH blockchain. 

 

 

 

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Why Trust CoinGape

CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.

About Author
About Author
Experienced writer and editor with a demonstrated history of working in the industry. Skilled in Copywriting, Web Content Writing, Copy Editing, Writing, Cryptocurrency News Writing, and News Editing.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.