Channel rebalancing is the habit of moving liquidity around so your node can keep forwarding payments. A channel can have plenty of total capacity but still be “useless” for routing if the funds are stuck on the wrong side. Rebalancing is how you turn stranded liquidity into usable inventory, so you can accept and forward more reliably and earn fees more consistently.

Why rebalance at all?

Routing is an inventory business. Every forward consumes outbound liquidity on one channel and restores outbound liquidity on another, and over time that naturally pushes channels toward extremes. Once a channel is nearly all local or nearly all remote, it becomes hard to use for the direction you need, so you start seeing more failures, more missed opportunities, and more time spent babysitting. Rebalancing is simply choosing to move some sats now, deliberately, so your node stays usable later.

Rebalancing basics in one mental model

Think of each channel as a bidirectional pipe where the “water level” is the local balance. For routing, what matters is not just how big the pipe is, but whether you have enough water on the side you need to push a payment through. Outbound liquidity is your ability to send through a channel; inbound liquidity is your ability to receive through it. A healthy routing node usually wants a mix: some channels that can push out, some that can pull in, and enough “middle” liquidity to act as a bridge between different parts of the network.

• Signs your node needs a rebalance
• Set a target before you move sats
• Strategy A: Circular rebalances
• Strategy B: Let the market rebalance you with fees
• Strategy C: Peer and channel management is a rebalance tool too
• Strategy D: External liquidity moves when loops aren’t enough
• Choosing what to rebalance first
• A lightweight routine that works
• Common mistakes to avoid
• A note for LN+ Liquidity Swaps users
• Takeaway

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