Global Cryptocurrency Exchange OKEx Moves to Cheaper and Faster Bitcoin (BTC) transactions with the upcoming Lightning Network integration.
According to a February 2 AnnouncementOKEx’s Bitcoin Lightning Network will be integrated “in the next quarter”, making OKEx a participating node in the Lightning Network.
The integration allows OKEx users to select the Lightning Network option when depositing and withdrawing BTC, with the aim of reducing transaction costs and times.
The Lightning Network is a second layer scaling solution and payment protocol based on the Bitcoin blockchain. The protocol was proposed by Joseph Poon and Thaddeus Dryja in 2015 in an effort to resolve Bitcoin’s scalability problem. According to data from the crypto analysis website BitInfoChartsThe average transaction fee for Bitcoin was over $ 15 on Feb. 1.
Since the Lightning Network itself is not a blockchain but rather a secondary layer, the solution was originally mainly used for small or even micro-transactions Bitcoin transactions. To solve this problem, Lightning Labs introduced so-called “Wumbo” channels in August 2020 to enable nodes to serve larger transactions while reducing on-chain costs. The word Wumbo, which apparently means “big”, is one reference to an episode from SpongeBob SquarePants. These channels are so named because they are larger than 0.1677 BTC ($ 5,800) limit.
OKEx isn’t the only crypto exchange to experiment with the Bitcoin Lightning Network. In July 2019, European crypto exchange Bitstamp set up your own Lightning Network node to increase the capabilities of the network. Another global exchange, Bitfinex, reportedly became the first crypto exchange to enable Lightning payments in December 2019. In September 2020, Bitfinex announced supporting Lightning Network’s Wumbo channels to enable their customers to deposit and withdraw large amounts of Bitcoin.
Amid Lightning Labs expanding the capabilities of the Lightning Network, more crypto exchanges have transitioned to integrate the protocol in recent months. In December 2020, the major crypto exchange Kraken in the United States announced that this will also happen integrate the Bitcoin Lightning Network in 2021. OKCoin also recently announced are plans to integrate the network in the first quarter of 2021.