In a bid to make it easier for businesses and individuals to receive funds via the Lightning Network, Lightning Labs has rolled out the alpha version of Lightning Loop, according to a blog post on March 20, 2019.
Receiving Bitcoins Easier with Lightning Loop
As stated in its blog post, the Lightning Labs team says it has received numerous feedback from users of the Bitcoin Lightning Network, asking it to create a solution that could make it easier for them to receive funds via Lightning. Now, the team has announced the launch of the first iteration of Lightning Loop; a non-custodial service facilitates receipt of funds on the Lightning Network.
Reportedly, the Lightning Loop Alpha version comes with the “Loop Out” functionality.
The primary objective of Loop Out is to allow users to easily transfer their funds from the Lightning Network to their cold wallets or crypto exchange accounts, thereby freeing up space in the channel for more funds to enter.
For the uninitiated, the Lightning Network is presently designed in a way that makes it impossible for funds to be received on a new channel until bitcoin has been spent via that particular channel.
In other words, nothing can be received once a new channel is opened since a room needs to be first created for incoming funds by spending. A payment channel can be thought of as a full bottle of water: to pour something in, one must first pour something out.
Per Lightning Labs, with the Loop Out feature, new Lightning users no longer need to rely on others to open channels with them before they can start receiving funds on the network since they can use Loop Out to get initial receiving capacity.
The Future of Lightning Loop
The team has made it clear that the next release of Lightning Loop will support the Loop In functionality, to enable users to reload their Lightning channels with bitcoin from their on-chain wallets or exchanges.
The team stated:
“As a user makes payments via Lightning, his/her channel funds decreases. They can then use the Loop In service to refill their funds on Lightning from a regular on-chain bitcoin wallet or through an exchange account and continue to add funds as needed,”
In this alpha release, Loop Out transactions are limited to 0.01 BTC, and the team says the service is feeless but on-chain transactions attract a charge.
It’s worth noting that the Lightning Network is fast gaining traction in the cryptospace.
Earlier in January 2019, BTCManager informed that Bitrefill had launched its Thor Lightning Channel for superfast and cost-efficient bitcoin payments.