Three Strategies for Lightning Forwarding Nodes



Summary:

The author of the email discusses various strategies that Lightning forwarding nodes can use to optimize their operations. These include passive rebalancing and setting fees according to balance, using low fees or a constant high fee while actively rebalancing, and buying cheap liquidity and reselling it at higher prices. The author notes that in a network with only passive rebalancers and walls, passive rebalancers would eventually prevail because they outcompete wall strategies. However, since there are many low-feerate nodes in the current network, walls can pick up liquidity for cheap and resell it later at higher fees, potentially outcompeting passive rebalancers. Unfortunately, low-feerate nodes are unreliable for payments, and some payment strategies filter them out, leaving them exploited by wall nodes instead of supporting payers. Both low-feerates and walls do not leak their channel balances, whereas passive rebalancers do. The author suggests that actual experimentation on models or real network nodes might be better than speculation.


Updated on: 2023-06-03T09:12:32.383895+00:00