Bitcoin Lightning Network turns out to be 1,000 cheaper from Visa & MasterCard

Recent data from Glassnode shows that Bitcoin’s Lightning Network (BTC) is significantly cheaper when compared to older ‘traditional’ payment networks.

Average rate of 3,000 Satoshis per 1 BTC

According to James Check, the lead analyst at Glassnode, the average rate for sending value over the Lightning Network is currently 3,000 Satoshis per 1 BTC. This rate equates to $0.84 to send $28,800 in value, equating to a fee of just 0.0029%.

Compared to the rates of payment processors such as MasterCard or Visa, the Lightning Network is therefore 1,000 times cheaper. That this is so much cheaper was noted by the Bitcoin analyst named ‘Dylan LeClair’.

The Bitcoin Lightning Network

The Lightning Network is a layer 2 payment solution built on top of the largest cryptocurrency in the world. It was originally proposed as a way to make Bitcoin effective as a payment method. Recent data shows that it is not only fast, but also cheap, as the average rate has been steadily falling since November 2021.

Traditional payment networks like Visa and Mastercard usually charge merchants 2-3% per transaction, making them a relatively expensive option for businesses. In addition, Glassnode’s Check reports users managing their own nodes and managing channels. Many Lightning users use custodial wallets like Wallet or Satoshi and Alby to make micropayments on social media apps like Nostr.

Lightning_Addresses

Still, the Lightning Network turns out to be good for relatively smaller payments. In closing, Check said the following:

Of course, we should also keep in mind that the typical channel is less than 1 BTC. The median channel size is 0.02 BTC and the average is 0.08 BTC, so overall the Lightning Network remains well suited for payments under $1,000.

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