Author: Olaoluwa Osuntokun 2019-10-12 01:23:04
Published on: 2019-10-12T01:23:04+00:00
In a message to the Lightning-dev mailing list, Rusty Russell, an Australian software programmer and bitcoin lightning network developer, proposed that 2/3 of current lightning network fees sitting on the default (1000 msat + 1 ppm) is problematic for two reasons. Firstly, low fees are now a negative signal, indicating lower reliability, and routing gets tarpitted trying them all. Secondly, there's no meaningful market signal in fees since you can't drop much below 1ppm. According to Rusty, changing defaults on new channels to 5000 msat + 500ppm as of the next release of c-lightning should move the noise floor up gradually over time. He picked 500ppm because it's still 1% at 20 hops, so minimally centralizing. The proposal was not well received, with some arguing that raising default fees would be misguided and that developers should instead focus on educating prospective routing node operators on best practices, providing analysis tools they can use to make channel management and liquidity allocation decisions, and leave it up to market participants to converge on steady-state economically rational fees.
Updated on: 2023-05-23T02:18:11.140185+00:00