Binance Tries To Enable Bitcoin (BTC) Deposits and Withdrawals via Lightning Network

Binance, a leading global cryptocurrency exchange, is currently in the process of integrating Lightning Network for Bitcoin (BTC) deposits and withdrawals.

The Lightning Network is a layer-2 scaling solution that aims to facilitate fast and affordable transactions for BTC.

Binance had announced its intention to adopt Lightning Network in May, following a network congestion issue that caused temporary suspension of BTC withdrawals, lasting for about 90 minutes.

Although withdrawals resumed, they were halted once again later that day for several hours, prompting Binance to consider integrating Lightning Network to improve transaction efficiency.

The CEO of the exchange, Changpeng Zhao, explained that the temporary pause in withdrawals was due to the significant fluctuations in Bitcoin network fees.

This was caused by a surge in demand for BRC-20 tokens. In May, Binance had mentioned that Lightning withdrawals would be helpful in such situations.

Recently, the exchange confirmed that it has started operating Lightning nodes. However, they have stated that more technical work needs to be done before fully integrating the network.

Crypto exchange Binance confirmed on Tuesday that it has started running nodes on the Bitcoin Lightning Network as part of its plan to integrate it for deposits and withdrawals.

“Some eagle-eyed users spotted our new lightning nodes recently,” Binance said in a tweet. “Yes – that’s us! However, there’s still more tech work to be done. We’ll update once Lightning is fully integrated.”

On May 8, the exchange announced plans to integrate a Layer 2 network in response to congestion on the main Bitcoin network.

The integration aims to reduce costs and increase transaction throughput, a feature already adopted by rival exchanges Kraken and Bitfinex.

According to The Block’s data dashboard, Bitcoin’s Lightning Network has steadily increased its capacity over the past year, now capable of supporting 1 million transactions per second.

At the last check, it stood at $148 million, according to the online publication The Block.