How to prepare for high mining fees, what about Liquid?
2 sats \ 8 comments \ @025738dda8 12 Dec 2023 bitcoin
Can somebody share any information/recommendations about utilizing Liquid, especially during high-fees seasons? Is there any good advantage? What do I need for that (tools)? I do understand the centralization concerns a bit, but there are other aspects as well...
I sometimes read about the possibility to use Liquid when the L1 BTC chain is overloaded. However, I have no more capacity to study it deeply at the moment. And it took me a long time to learn about Lightening and I feel I am still at the beginning.
Always, when fees gets lower, I am thinking about some preparation for when they skyrockets again. It is possible to e.g. open more LN channels, fund more LN wallets, etc. However, I consider even LN vulnerable to high fees due to unwanted channel closing, getting stuck due to liquidity issues, etc... It is good to have another way, how to move funds or how to pay. Is there any interesting way? Do you already use some approach here?
What about loop-out from LN to Liquid? Are there any Liquid-based lightning nodes anywhere?
I hope, I do not have very silly questions...
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5 sats \ 3 replies \ @Krv 13 Dec 2023
I've set aside some of my funds to Liquid for that purpose. I also used it to store Tether in the past, as it is an asset on Liquid. Tools are Jade Hardware Wallet, or Green Wallet on Pc or mobile. You can use Sideswap to get Liquid to your LBTC wallet using the Peg-in tool, and peg-out for the reverse. Boltz.Exchange allows changing from Lbtc to Lightning and vice versa. Sideshift.ai is also an option. Liquid and Lightning are good options to mitigate fee and it is good to be ready.
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0 sats \ 2 replies \ @025738dda8 OP 13 Dec 2023
Does it really help you somehow? Can you see and feel any real advantage? I.e. do you pay somebody with L-BTC? What exactly is the role of Liquid here?
I can image to use it for rebalancing LN channels (loop-out one channel and loop-in another one). Does it make sense? And, would it be really cheaper?
I do not like the idea to keep much Liquid funds in long-term. I am just thinking about it as a "medium" to avoid L1 tx temporarily. Tether is not something I'd like to use.
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20 sats \ 1 reply \ @Krv 13 Dec 2023
The role of Liquid is that if I need to move some funds to Lightning, I can do so with far lower fees than from BTC. At the same time, I can also store the LBTC in a secure wallet. If I need to go to Fiat, I can use Lightning via Strike to go to my bank or CC, extremely low fees. If Bitcion volume jumps, it could cost $20.00 (right now it seems to be around $8.00) or more to get into a block, vs. Liquid at about $0.10.
This may change if Liquid volume increases, but for now, low for the short term future.
It probably can be used to re-balance channels, which is a good use case. I believe Boltz does help with that. Also, Phoenix wallet automates that for you I believe. With the splicing feature it can be done very cheaply, no additional onchain tx.
In terms of amounts, I don't keep a high percentage. Just enough to be good for a few months of living expenses.
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0 sats \ 0 replies \ @025738dda8 OP 13 Dec 2023
Thanks for sharing. This is what I was asking about.
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5 sats \ 1 reply \ @DarthCoin 12 Dec 2023
Here is what I have to say about all this hysteria with Liquid... #318849
L1 BTC chain is overloaded.
No, is not, it works as it was designed. You can't handle high fees? You always have the option to go back to fiat, if you think Bitcoin is too expensive.
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0 sats \ 0 replies \ @025738dda8 OP 13 Dec 2023
Thx for the link. I get your point.
No, is not, it works as it was designed.
True, it does.
You can't handle high fees?
Yes, I can. But can I do better?
You always have the option to go back to fiat.
Unfortunately 😉.
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0 sats \ 1 reply \ @kytt 13 Dec 2023
Consolidate your UTXOs so if the fees spike even more in the future, it's not such a big deal.
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0 sats \ 0 replies \ @Longtermwizard 13 Dec 2023
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