Will average Lightning transaction size go up, down, or remain flat over time?
934 sats \ 21 comments \ @kr 23 Oct 2022 bitcoin
In River's recent Lightning report, they said their Lightning nodes routed 115,648 transactions in September with an average transaction size of $46.
I did some digging and found that this fits squarely between the average transaction sizes on Visa and MasterCard networks.
I know River is just a subset of Lightning activity, but it’s the best Lightning transaction data available today.
Assuming River’s $46 transaction size is true for the entire network, do you think average Lightning transaction sizes will trend up, down, or remain flat over time?
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170 sats \ 0 replies \ @faithandcredit 23 Oct 2022
I like this data. Even tho its only from a single node. But it suggests that LN is moving "consequential" amounts and not just some basement experiment for lack of a bettter term
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170 sats \ 0 replies \ @timechain 23 Oct 2022
Hard to say, on one hand the mainstream exchanges (coinbase, FTX, crypto_dot_com, Binance) haven't enabled it yet, but eventually will. (Do their users even withdraw though?) On the other hand, I think microtransactions are a use that hasn't been fully explored yet, besides some V4V podcast apps. I'm sure new uses for microtransactions will arise. But basechain transactions are still super cheap, and won't be forever... not sure, i guess, there will be emerging forces pulling it both ways.
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161 sats \ 4 replies \ @02947a7fb5 23 Oct 2022
Average transaction size will generally go down over time. Sats will appreciate in value and everything else will deflate. LN channels will hold more value and be able to transaction more value per sat and the early holders of sats will be able to buy more for less sats.
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194 sats \ 1 reply \ @tomlaies 23 Oct 2022
On the other hand:
  • Deflationary/hard economic systems encourage to consume less but higher quality. This could make transactions fewer but bigger.
  • Atm the Lightning Network transacts a lot of gimmicks like sats every minute of podcast playback or play2earn yield of a few hundred every time. Every day economy of humans has bigger transactions
  • Institutions are not on Lightning yet. Big corporations and institutions will push average transaction size higher.
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0 sats \ 0 replies \ @02947a7fb5 23 Oct 2022
You know how much junk people buy? Yeah all of that useless crap will be cut out.
Well yes because LN is able to. That Doesn’t affect normal/other transactions/purchases. Again things priced in fiat will trend down in terms of sats until a certain point.
Well some. River is putting out average transactions of 47$. So you can convert that to sats and extrapolate trends from it. Institutions will either use onchain or liquid for fat sat transactions. So most of those will be off LN. I’m sure we will get an average size much larger than a median size. I can’t imagine what large corporations would be using LN for other than to sell and pay employees with.
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0 sats \ 1 reply \ @kr OP 23 Oct 2022
if LN channels appreciate in value, wouldn’t that raise a given node’s ability to route larger USD-denominated payments?
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0 sats \ 0 replies \ @02947a7fb5 23 Oct 2022
Well yes. When items are priced from their fiat equivalent the amount of sats will be lower so channels will be able to route more and routing to an exchange will give you more buying power when converting to fiat from sats. I won’t complain if my sats are worth more in fiat.
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161 sats \ 1 reply \ @aljaz 23 Oct 2022
considering one of the lightning's major selling points is microtransactions at near zero cost I'd guess that the real size of transaction is/will be smaller.
For example how do you account for streaming sats? Is the entire stream one transaction or every sat sent is its own (technically thats correct). Tipping, streaming sats etc should bring the global average down significantly since there is an endless amount of transactions that are possible and usable on lightning that just don't make sense on Visa or Mastercard.
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10 sats \ 0 replies \ @kr OP 23 Oct 2022
agree, but one other improvement lightning offers is speed.
traders can arbitrage different exchange rates in an instant on lightning, and may be willing to pay higher fees for large transactions just for the ability to settle a payment right away.
I do think the micro-transaction use case is a powerful one though. Really hard for me to guess where avg transaction size goes from here.
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129 sats \ 0 replies \ @dergigi 23 Oct 2022
One of the three.
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9 sats \ 2 replies \ @satorin 23 Oct 2022
Are we measuring the world in Sats, yet?
(serious question as I am re-wiring my brain)
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0 sats \ 1 reply \ @kr OP 23 Oct 2022
some of the lightning community is, but almost all of the world is not.
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0 sats \ 0 replies \ @satorin 24 Oct 2022
I see... guess so and may not be necessary to completely re-wire your brain, but it helps to understand something natively, and when we still have to choice to (instead of being forced to).
I also found it helpful to learn (and try to understand) concepts like the UTXO model, which is still a bit foreign otherwise.
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9 sats \ 0 replies \ @felix 23 Oct 2022
The median size will go down even further.
The average size will probably also go down, though that's hard to say since the network will most definitely get more centralized over time, meaning a few large transactions between big nodes will push up this average quite a lot.
I think that the average might even go up.
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0 sats \ 0 replies \ @zman 24 Oct 2022
I know the average transaction size that CAN be transmitted is getting larger and that's all I care about.
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0 sats \ 0 replies \ @sp 24 Oct 2022
If you mean in USD, it will inevitably go up - because of rampant inflation. On the other hand, I doubt you can see the same numbers in places like El Salvador, given their average income and living costs.
There's also a risk of sampling bias, as I doubt that Lightning_over_River is used as much as Visa & Mastercard at retail/brick_and_mortar stores - and the opposite, where Lightning might be used primarily online.
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0 sats \ 0 replies \ @selfish_gene 23 Oct 2022
если твоя комиссия превысит 1 сатоши я сам отрою узел с кем мне нужно... понятно?
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0 sats \ 3 replies \ @godlikeXi 23 Oct 2022
Needs to go up. When networks are used and are popular the bandwidth needs to be bigger to accommodate those users and more. Anecdotally I see more LN users out here. I use Fountain and this platform. I practice what I preach. I’m new to Stacker.News no one told me about this. A Twitter user hipped me. Needs to go up.
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267 sats \ 0 replies \ @satcat 23 Oct 2022 freebie
Doesn't "need" to do anything, but will prob go up as btc price appreciates.
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0 sats \ 0 replies \ @shyfire 23 Oct 2022
Average transaction size doesn't need to go up. However routable transaction size does need to go up. If I'm buying groceries or hardware at Home Depot over lightning one day I want large transactions to go through and not fail.
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0 sats \ 0 replies \ @kr OP 23 Oct 2022
why does average transaction size need to go up?
i expect the number of users and transactions will go up, but why would that affect the average size of a transaction?
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