pull down to refresh

So, what I'd look at is the cost of opening and closing the channel, and contrast that to what fees you think you can set. The more you fund the channel you open with the less fees you can charge while aiming to break even. If your channel isn't used a lot, your channel may be closed as soon as your remote has a large enough amount of sats on their side that they judge could be used better (unless you have some agreement). So, you might perhaps estimate that only half of your liquidity will be pushed out. Fiat price has not much to do with anything here. That only comes into play when you want incoming liquidity for receiving payments for something you sell.
with a higher fiat price, you have the potential to route many more transactions of all sizes and earn more fees. How is that not relevant?
reply
From the perspective of the ROI (fees) of the funds allocated to the channel size and its life cycle its not relevant. Everything is measured it sats. The transaction count only matters if you have a significant base fee set...
reply
At $10K Bitcoin, if I have a 1M sat channel I can route 10 $10 txs and earn fees on those 10 txs.
At $100K Bitcoin, if I have a 1M sat channel I can route 100 $10 txns and earn fees on those 100 txns.
So, in this example I'd earn 10x more in fees when Bitcoin is 10x the price.
What am I not understanding?
reply
1 sat = 1 sat! :D The fees are in ppm. So, for an 1M channel you get (1e6 * f_ppm + n * f_base) in fees (ish - excluding reserves etc.), regardless of the fiat price of bitcoin (n is the tx count). If f_base is zero then the count of transactions doesn't matter unless you're on an edge and can do rounding to your benefit. So, you earn more in fiat terms but not in sat terms.
reply