Binance is working towards the full integration and implementation of the Bitcoin Lightning Network to ensure smooth customer experience for deposits and withdrawals.
On Tuesday, June 20, the world’s largest crypto exchange Binance announced that it has started operating nodes on the Bitcoin’s Layer-2 scalability platform aka Lightning Network. Binance said that it would be a crucial step towards integrating deposits and withdrawals on the crypto exchange.
Binance confirmed its presence on the Lightning Network through a tweet while acknowledging users who noticed it. However, it added that some technical work is still pending before the full implementation.
The exchange tweeted:
“Binance is working to integrate the #Bitcoin Lightning Network for deposits and withdrawals. Some eagle-eyed users spotted our new lightning nodes recently. Yes – that’s us! However, there’s still more tech work to be done. We’ll update once Lightning is fully integrated.”
As said, the Bitcoin Lightning Network is a Layer-2 protocol built atop the Bitcoin blockchain in order to address the scalability issues. Crypto market players can create payment channels atop the Bitcoin Lightning Network. Additionally, they can also conduct off-chain transactions in a quick and inexpensive manner, while making settlements on the Bitcoin blockchain whenever feasible.
The goal of the Lightning Network is to enhance the speed, scalability, and privacy of Bitcoin transactions. It will bring more efficiency for microtransactions to take place while reducing congestion and fees on the Bitcoin mainnet.
Binance to Leverage the Power of Lightning
Binance’s decision to integrate Lightning Network at their end came after it had to suspend deposits and withdrawals last month in May, after facing a large volume of pending transactions. The increased congestion typically happened due to the massive surge in BRC20 transactions after the rising popularity of memecoins launched on the Bitcoin blockchain.
Back then, the exchange noted:
“To prevent a similar recurrence in the future, our fees have been adjusted. We will continue to monitor on-chain activity and adjust accordingly if needed. Our team has also been working on enabling BTC Lightning Network withdrawals, which will help in such situations.”
Binance has faced a legal battle with the SEC, which created uncertainty for the company. However, there is now a sense of relief as Judge Amy Berman Jackson approved a consent agreement between Binance, Binance.US, and the SEC. This agreement dismissed the SEC’s temporary restraining order that aimed to freeze Binance.US assets.