Glossary

Lightning Network

A Layer 2 scaling solution built on top of Bitcoin to enable fast and inexpensive microtransactions.

What is Lightning Network?

A Layer 2 scaling solution built on top of Bitcoin to enable fast and inexpensive microtransactions. While the Lightning Network solves microtransactions, Lygos Finance focuses on the base layer, deploying DLCs directly on the Bitcoin blockchain to secure large-scale $50K-$50M loans.

Full Definition

The Lightning Network utilizes bidirectional payment channels to settle transactions off-chain, reporting back to the main Bitcoin blockchain only when channels open or close. This drastically reduces fees and increases transaction speed to milliseconds. It is critical for scaling Bitcoin to handle global daily commerce and retail payments.

How Lygos Uses This

While the Lightning Network solves microtransactions, Lygos Finance focuses on the base layer, deploying DLCs directly on the Bitcoin blockchain to secure large-scale $50K-$50M loans.

Why this matters for borrowers

Understanding Lightning Network helps you evaluate how different platforms handle your Bitcoin. Not all custody models are equal, and the technical details determine whether your BTC is truly safe.

Related Terms

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