Bitcoin's Lightning Network reached a capacity record of 5,606 BTC on Monday, surpassing its previous peak from March 2023.
The milestone reflects growing institutional adoption as exchanges deposit more Bitcoin into payment channels.
Analytics platform Amboss reported 5,637 BTC, valued at approximately $490 million.
Capacity surged in November and December after a year-long decline.
What Happened
Major exchanges including Binance and OKX drove the capacity increase by depositing substantial Bitcoin into Lightning channels.
The Lightning Network processes payments off-chain through channels between nodes, enabling faster and cheaper transactions.
Lightning node count stands at 14,940, down from 20,700 in March 2022.
Channel count similarly declined to 48,678 from earlier peaks.
The data indicates more Bitcoin is being added to existing channels rather than broad network expansion.
Lightning Labs upgraded Taproot Assets to version 0.7 on Wednesday.
The upgrade adds reusable addresses, auditable asset supply, and support for larger transactions.
Taproot Assets allows stablecoins to be minted on Bitcoin and transferred through Lightning channels.
Stablecoin issuer Tether (USDT) announced Tuesday it led an $8 million investment in Bitcoin startup Speed.
Speed processes over $1.5 billion annually and serves 1.2 million users through Lightning infrastructure.
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Why It Matters
The capacity record signals institutional confidence in Bitcoin's layer-2 scaling despite declining node counts.
Exchange participation marks a shift toward custodial infrastructure prioritizing liquidity over decentralization.
Higher liquidity per channel enables larger transactions and more efficient payment routing.
The Taproot Assets upgrade positions Bitcoin to compete with Ethereum-based stablecoin networks.
"With this release, we are laying the foundation for trillions of dollars to flow on Bitcoin and Lightning," Lightning Labs stated.
Combining Lightning's speed with stablecoin stability addresses major barriers to Bitcoin payments adoption.
Tether's investment in Speed demonstrates commercial interest in Lightning-based payment rails.
The convergence of exchange liquidity, protocol upgrades, and stablecoin integration could accelerate Lightning's transition from micropayments to high-value transfers.
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