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2024-05-06 02:24:30

Amboss on Nostr: The LINER (Lightning Network Rate) has two sides: liquidity buyers and liquidity ...

The LINER (Lightning Network Rate) has two sides: liquidity buyers and liquidity sellers.

Liquidity buyers are leasing swap space for payments. Since transaction fees have risen, the cost of capital for that swap space has risen.

This is tracked as the LINER Cost. 🧵

Lightning channels are reusable payments infrastructure, gaining efficiency with each lightning payment versus on-chain Bitcoin transactions or traditional card payments.

The swap space required is the monthly *NET* payment inflows. Any payments made from a lightning business reduce the swap space required.

Lightning is therefore ideally suited for low margin businesses where payment processing costs are large relative to profit margins.

Lightning Network becomes a competitive edge for the pioneers of better payments.
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