Why Lightning Network capacity declining 20% in 2025 is NOT as bad as it sounds

Bitcoin’s Lightning Network capableness has declined from implicit 5,400 BTC successful precocious 2023 to astir 4,200 BTC by August 2025, a astir 20% drop, per mempool.space data. While the earthy figures connote a contraction, analysts and developers suggest the displacement reflects structural improvement successful routing and protocol plan alternatively than a retreat successful adoption.

Lightning capableness vs usage

The network’s capableness metric refers to the full magnitude of BTC locked successful publically advertised outgo channels, which signifier the graph utilized to way peer-to-peer transactions.

As River’s 2023 Lightning report explains, this fig does not bespeak backstage channels, custodial flows, oregon multi-path routed payments. The aforesaid study recovered that contempt lone mean maturation successful capableness astatine the time, routed payments connected Lightning accrued 1,212% betwixt August 2021 and August 2023.

Coinbase’s integration of Lightning successful 2024 brought measurable volume. By mid-2025, Lightspark reported that astir 15% of Bitcoin withdrawals connected the level were present routed via Lightning.

CoinGate, a European crypto payments processor, has besides reported that Bitcoin’s stock of crypto payments connected its level regained dominance successful 2025, with interior information attributing portion of that measurement to increasing usage of second-layer networks, including Lightning. In its 2024 quarterly breakdown, CoinGate noted that Lightning had already accounted for implicit 16% of each Bitcoin orders, up from astir 6.5% 2 years earlier.

The diminution successful nationalist capableness accompanies a longer-term driblet successful nationalist node and transmission counts, which person been successful dependable diminution since 2022, according to information from mempool.space.

Lightning capableness (Source: mempool.space)

Developers property portion of this inclination to the consolidation of routing done better-managed hub nodes and the adoption of protocol enhancements similar transmission splicing. These changes let wallets to resize channels without on-chain transactions, reducing the request for caller channels and enabling much businesslike usage of liquidity.

Continued Lightning development

While the nationalist graph whitethorn look smaller, caller developments whitethorn beryllium expanding the scope of the network’s usage cases. In January 2025, Tether announced the rollout of USDt implicit Lightning via Taproot Assets, successful collaboration with Lightning Labs.

This opens the doorway to dollar-denominated payments and stablecoin-backed remittances connected the network, which would not necessitate BTC to beryllium locked successful channels, efficaciously decoupling usage from Bitcoin-denominated capableness metrics. Lightning Labs CEO Elizabeth Stark said the integration combines the information of Bitcoin with the velocity and scalability of Lightning.

At a structural level, developers are besides addressing issues that impact outgo reliability and transmission health. Research connected jamming attacks and replacement cycling vulnerabilities continues done the Bitcoin Optech moving groups, portion features similar BOLT12 Offers and liquidity automation tooling are making Lightning much robust for commercialized usage.

There is besides a noticeable enlargement successful exertion layers utilizing the Lightning protocol. One illustration is L402, a specification that enables pay-per-request APIs utilizing Lightning-native authentication and micropayments, present deployed successful aboriginal AI cause stacks specified arsenic LangChainBitcoin.

The plan enables automated agents to wage per inference telephone oregon API effect without requiring fiat accounts oregon static keys, offering a caller machine-to-machine outgo watercourse that does not trust connected capableness maturation to scale.

These protocol and use-case shifts supply discourse for wherefore nationalist capableness unsocial whitethorn nary longer beryllium a implicit indicator of the network’s adoption trajectory.

Developers reason that Lightning’s existent improvement is little astir increasing disposable liquidity and much astir expanding the inferior of each satoshi already successful motion.

While the nationalist capableness trendline whitethorn beryllium descending, the underlying metrics connected usage, integration, and method advancement archer a antithetic story.

The station Why Lightning Network capableness declining 20% successful 2025 is NOT arsenic atrocious arsenic it sounds appeared archetypal connected CryptoSlate.