The Lightning Network stands out as Bitcoin's leading second-layer solution, designed for swift, low-cost transactions without burdening the main blockchain. It connects users via a network of bidirectional payment channels, allowing instant fund transfers while minimizing on-chain activity. Each channel operates on a 2-of-2 multisig Bitcoin address, updating balances off-chain in real time. When direct channels are absent, the network finds alternative routes secured by hashed timelock contracts and onion encryption for privacy. Pathfinding is complex, requiring nodes to compute routes without real-time liquidity data, leading to advanced routing algorithms. By early 2025, public Lightning capacity exceeded 5,000 Bitcoin, reflecting significant adoption and institutional trust. With over 650 million users accessing the network through various platforms, running a Lightning node has become more accessible, enabling users to earn Bitcoin through routing fees. However, profitability remains challenging for small operators, as larger nodes dominate the network. Effective strategies involve connecting to a diverse range of peers and utilizing automation tools to optimize earnings. Read more AI-generated news on: https://app.chaingpt.org/news

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