Over the past two years I ran an amateur routing node that was in the top 300 on lightning terminal.
I have decided to stop for the following reasons
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ProfitabilityI routed many payments but was never profitable. My total lifetime node statistics are in the table below:
Line Item Lifetime Payments Routed 24,916 Value Routed 944,239,099 Revenue Earned 14,790 [15] Onchain Costs 784,204 Offchain Costs 9,665 [474] Percent Cost 5,367% Profits -779,079 [-825] Could I have done a better job managing my expenses and routing fees? Yes. There are lots of people who run lightning nodes profitability. I was just not one of them. If I had spent more time optimizing my fees and I raised my fee rates I could have been.But even doing that wouldn't stop random force/regular closures which require you to reallocate your capital to another channel (which means you have to spend sats on opening fees).If you want to run a routing node successfully you really need to treat it like a business. And there are actually a lot of expenses in doing so that aren't apparent upfront. -
ResponsibilityI am happy that it is possible for anyone to run a routing node. However just because you can doesn't mean you should.It's a big misconception is that everyone needs to be a routing node. While on paper most people can easily set one up. The average person is much better off connecting to an existing, reliable routing node than trying to make their own. Managing inbound/outbound liquidity requires some effort. And if you don't keep up with it, you might be doing more harm than good to the network. Over-leveraged inbound and outbound liquidity results in more failed payments on the network.I had about double to triple inbound liquidity so I saw a lot of failed transactions and I probably contributed to an overall worse UX for the rest of the network because of those failed transactions. I did not run my node very responsibly because I was doing it as a hobby.As silly as it sounds, I just really wanted a higher lightning terminal score and larger node appearance so I bought inbound liquidity to make my node look larger.So while I did have a large amount of outbound. It really was a lot less than what it appeared to be. And while it was fun for me to have a larger score, it probably wasn't fun for the people not able to route their payments.
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Risk It is risky to run a lightning node. The software is still experimental, bad backups can lose all your funds, all your money is in a hot wallet. Things can go wrong!! Am I saying don't do it? No, but what I am saying is only put in what you're willing to lose. Because bugs, backup mistakes, software/physical security breaches can happen.I am willing to accept these risk but only with less capital than I had allocated when I was a routing node. I only had success forwarding when I started to have many channels with large bandwidth. It's just no longer worth it to me anymore to maintain that.
So going forward, I am only going to use private channels and focus on my usage not forwarding payments for others.