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34 sats \ 4 replies \ @Scoresby 8 Apr freebie \ parent \ on: Phoenix lightning wallet - questions on strategy for my use case lightning
This is a tricky situation. And don't quite know how Phoenix's purchase liquidity handles it.
When you set up a ln channel, you and your channel partner each commit a specific amount of btc to the channel. When you spend on the lightning network, you are changing the balance so that your channel partner has more of the funds and you have less. When you receive it's the opposite.
If you both put 500k sats in to start the channel, you can receive up to 500k sats before the channel stops making sense (you can't receive more than your channel partner has committed to the channel).
When you request liquidity from phoenix, they are adding more btc to the channel.
Now, if you transfer out of phoenix to an on chain address you aren't moving any btc back to phoenix's side of the channel. Your removing it from the channel altogether.
If you purchase 1million sats inbound liquidity, they add that much to their channel with you.
If you receive 800k sats you reduce that inbound liquidity to 200k.
If you transfer out of phoenix onchain it definitely won't rebalance the liquidity to phoenix's side.
The question is does it shrink the channel size so much that impinges on the remaining 200k inbound liquidity. I wouldn't expect it to.
The channel never shrink if you leave a min % reserve in it.
The channel is closed if you move all sats from it.
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This is true for normal lightning.
But splicing makes it different, I think.
In phoenix I always only have one channel and it is between me and phoenix. Any onchain transaction i make affects the size of this channel.
If I make a transaction sending from my phoenix wallet to my on chain, it has to change the size of the channel, even if it is only a small percent that you send out.
If it doesn't change the channel size, where do the sats come from?
I have done exactly this multiple times, and it reduced my channel size by the amount I sent out.
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That's the thing, you are using internal swap.
Use external swap (sending a normal LN payment to the swap) and you will see that will not reduce the size. Is also cheaper using an external swap.