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Phoenix Wallet - any way to prevent creating new channels?
250 sats \ 9 comments \ @mh 24 Feb 2023 bitcoin
New Phoenix Wallet user, switched after the BlueWallet announcements yesterday. I received 4 payments over 10k sats from two different sources, why did I have to pay 3k sats for all 4 payments?
Shouldn't the first one have opened the channel and then not need a new channel for the second?
Is there any way to keep this from happening?
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40 sats \ 2 replies \ @DarthCoin 24 Feb 2023
  1. Always start reading FAQ: https://phoenix.acinq.co/faq
  2. Why stop using bluewallet, just because their lndhub server it shuts down? Don't you run your own node? Or you can use any other lndhub provider. lndhub.io was just one in the ocean of them.
  3. Why not using both BW and Phoenix?
  4. Usually Phoenix is taking a reserve for first time you open a channel, so they will cover the fees for opening and closing the channels that they manage for you. If you already opened a channel, the next payment, if is higher than the "space" remained in the already opened channel, then it will open a new one, but will not charge you again that reserve.
Yes, indeed they have a weird policy / setup that is opening small channels, only slightly higher capacity from the initial deposit.
Let's say you receive 50k sats, they will open a 60k sats channel, with those 50k-1% (reserve) on your side.
Now, if you want to receive another 5-8k sats, maybe they will fit them into that channel and will not open another one. But if you will receive a 10-13k definitely they will open a new channel. If you almost empty that initial channel of 60k, let' say you send out 45k from those 50k. Then next payment you could receive it into that almost emptied channel.
If you are get used to do these kind of channel control, you can always use the same channels. Keep in mind to not empty them totally, just leave some sats in them, in this way you can always receive in the same channel.
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100 sats \ 1 reply \ @MathiuJ 25 Feb 2023
Keep in mind to not empty them totally, just leave some sats in them
Even if the channel is completely empty, it will still stay open (see screenshot below from my Phoenix wallet's channel list). I have been using Phoenix since September of last year and been very happy with it; it's a solid non-custodial wallet, in my humble opinion.
https://i.imgur.com/LfxL5L0.png
P.S. @DarthCoin I know you catch a lot of crap on here for your strong "opinions" on various LN related-issues, but I wanted to say thanks for taking the time and patience to educate folks not as far along as you on the LN path to victory. Cheers, friend.
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0 sats \ 0 replies \ @DarthCoin 25 Feb 2023
Indeed, sometimes channels remain open even if are empty, but not for long. That's good.
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25 sats \ 0 replies \ @JeanLamine 24 Feb 2023
The is the option to disable automatic on the fly channel creation in the configuration menu.
What you probably want to do is send yourself a large paiement to open a big channel, then return most of the funds to yourself to make room on that channel to recive paiements.
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16 sats \ 4 replies \ @petertodd 24 Feb 2023
The reason why that happened is because Phoenix doesn't allocate any excess capacity in your direction when the channel is opened. So each subsequent payment needs a new channel.
OTOH if you had made a payment from your wallet to someone else there would be capacity incoming, and you wouldn't have needed a new channel.
Phoenix could do this differently. But capacity costs money because it ties up BTC so I guess this is the trade-off they've chosen to make.
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0 sats \ 3 replies \ @nerd2ninja 24 Feb 2023
I really thought that 3k sat fee was only for the first channel and the fee went down after that.
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46 sats \ 2 replies \ @petertodd 24 Feb 2023
Nope. The 3k fee represents their actual cost per channel. They also take another 1% of the amount of the channel to fairly pay for the cost of the capital they have to tie up.
Personally I think all the fees are totally fair. If anything, it's hard to make money on those fees, as you're trying up a lot of capital with little return if people don't use their wallets frequently.
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199 sats \ 1 reply \ @DarthCoin 24 Feb 2023
Personally I think all the fees are totally fair.
Agreed. Only who doesn't run a LN node would say that Phoenix fees are high, because they do not know how much is the real cost to maintain a LN node liquidity.
The only thing that I find it weird / I don't have an explanation, is that they are not opening a bigger channel. At least a 40% more than what you deposit. I know that will be a bigger effort for them to put that liquidity, but could avoid too many open/close channels.
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25 sats \ 0 replies \ @dolu 25 Feb 2023
The reason is pretty simple I think. They have to allocate fund for each new channel. They don't have unlimited bitcoin, so they cannot allocate 40% of each new channel. If they do that, their "LSP" will run out of bitcoin pretty fast I think, and no channel could be created.
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