Lnfi Network Integrates RGB Protocol to Enhance Lightning Network

Bitcoin Magazine

Lnfi Network Integrates RGB Protocol to Enhance Lightning Network

Lnfi Network, a DeFi platform on Bitcoin’s Lightning Network, has integrated the RGB Protocol, enabling scalable, programmable assets on Bitcoin. Announced alongside RGB’s mainnet launch, this allows developers and users to trade and manage RGB-based assets using Lnfi’s infrastructure.

Darius, co-founder of Lnfi Network, described the platform as “next-gen peer-to-peer financial infrastructure built to empower Bitcoin-native assets that can be settled on Lightning.” Operational on mainnet since late 2023, Lnfi processes $20-30 million in daily trading volume on its orderbook exchange, he said.

RGB, developed by the LNP/BP Standards Association, uses off-chain smart contracts compatible with Lightning, supporting complex financial apps without burdening Bitcoin’s blockchain. “RGB gives developers the power of off-chain smart contracts,” said Maxim Orlovsky, RGB lead engineer. Lnfi supports Lightning-compatible standards like Taproot Assets, RGB, Lrc20, and Ark, catering to traders, node operators, miners, and venture firms, per Darius.

Lnfi leverages Nostr, a decentralized protocol, to enhance transparency and decentralize the orderbook, a common bottleneck in atomic swap exchanges. Every user action — deposits, withdrawals or orders — is sent as an encrypted Nostr event. “Nostr’s encryption and transparency prevent order tampering or front-running,” Darius stated. Orders are processed by Lnfi’s Nostr client, matched or posted to a decentralized order book across relays, ensuring scalability and reliability with two relays currently operational, he added. This setup prevents manipulative liquidations, as “every trade is collateralized” and trackable, unlike centralized exchanges where fake liquidity can distort markets, Darius explained.

The integration aligns with RGB’s momentum, boosted by Tether’s planned USD₮ issuance on the protocol, which handles over 80% of stablecoin volume with $150 billion in circulation. “This gives RGB projects tools for real-world use, like high-volume trading,” said Luke, Lnfi co-founder. Lnfi’s work is supported by UTXO Management, CMS Holdings and Wolf NYC (NYDIG), per Darius.

For self-custody trading, Lnfi plans to implement settlements within Lightning channels and via the Ark Protocol, using off-chain transactions for instant finality, Darius noted. Visit lnfi.network for more info.

Bitcoin Magazine is wholly owned by BTC Inc., which operates UTXO Management, a regulated capital allocator focused on the digital assets industry. UTXO invests in a variety of Bitcoin businesses, and maintains significant holdings in digital assets. 

This post Lnfi Network Integrates RGB Protocol to Enhance Lightning Network first appeared on Bitcoin Magazine and is written by Juan Galt.