MemPool House information on August 2 exhibits that roughly 48% of all Bitcoin Lightning Community (LN) Nodes are hosted by main centralized cloud service suppliers, particularly Amazon Internet Service (AWS) and Google Cloud. Particularly, roughly 29% of Bitcoin Lightning Community nodes are deployed on AWS, whereas 19% are hosted on Google Cloud. 

Bitcoin Lightning Network Nodes on Google Cloud and AWS: MemPool Space
Bitcoin Lightning Community Nodes on Google Cloud and AWS: MemPool House

This pattern factors to the excessive reliance of Bitcoin Lightning Community node operators on centralized cloud companies. Not like working an area node, reliant on centralized options can supply a excessive diploma of uptime and reliability, reaching almost 100%.

Associated Studying: Binance Reduces Terra Basic (LUNC) Provide By One other 1.14 Billion

Over-Reliance On Google Cloud And AWS?

Bitcoin’s community contains nodes operated by miners from everywhere in the world. This contrasts with the extra centralized strategy taken by Google Cloud and AWS. Regardless of mining farms and swimming pools being dominant in mining exercise, hundreds of particular person Bitcoin miners are distributed throughout the globe.

Bitcoin price on August 2| Source: BTCUSDT on Binance, TradingView
Bitcoin worth on August 2| Supply: BTCUSDT on Binance, TradingView

That the Bitcoin Lightning Community is powered by nodes deployed totally on Google Cloud and AWS raises consciousness of an inherent problem inside the Lightning Community structure. Whereas the Lightning Community facilitates off-chain BTC transactions via channels, enabling almost prompt settlements and decrease charges, node operators should preserve a relentless on-line presence to execute these transactions.

Each events have to be on-line within the Lightning Community to provoke transactions for the sensible contracts to replace. If one occasion doesn’t reply, they might lose the funds within the channel. Many node operators use centralized cloud companies like Google Cloud and AWS to keep away from this.

Voltage, a Lightning as a Service (LaaS) platform, partnered with Google Cloud in Could 2023 to boost scalability. In an announcement, Voltage stated the collaboration will empower customers to determine Bitcoin and Lightning Nodes throughout a various vary of places, using the mixed capabilities of Voltage and Google Cloud. 

Voltage via Google Cloud has onboarded 87 Bitcoin LN nodes when writing on August 2. Nonetheless, most BLN nodes, at the moment at over 550, are deployed on AWS. The cloud supplier began supporting the deployment of BLN in 2022. 

Extra BTC On Ethereum Than Lightning Community

As of August 2, the collective capability of the Bitcoin Lightning Community has exceeded $138.4 million in BTC, facilitated by a community encompassing over 15,500 particular person nodes. Nevertheless, adoption has been comparatively low whereas the Lightning Community has succeeded, permitting customers to transact with instantaneous settlements with out essentially ready for 10 minutes or extra.

Extra cash are being tokenized and moved to sensible contract platforms like Ethereum or the BNB Chain for extra yields through decentralized finance (DeFi). Dune Analytics information reveals extra BTC has been transferred to Ethereum and even much less locked in Bitcoin Lightning Community nodes.

Characteristic picture from Canva, chart from TradingView


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