Lightning Labs, a Bitcoin company backed by Twitter founder Jack Dorsey and Robinhood co-founder Vlad Tenev, released lnd 0.11-beta on August 20th, an upgrade to the Lightning Network Daemon (LND) that allows for the operation of bigger Lightning channels.

Since 2016, Lightning Labs, which recently raised a $10 million funding round, has been building software on top of the Bitcoin Network. 

The firm describes LND as a “complete implementation of a Lightning Network node.” Through LND, users can execute various Lightning-related operations, including creating and closing Lightning channels. LND is one of the three open-source projects spearheaded by Lightning Labs, alongside Loop and Neutrino.

What Are Lightning Channels?

The Lightning Network is a second-layer scaling technology on top of the Bitcoin blockchain that enables users to send and receive payments instantaneously with near-zero fees. 

Conceptually, a Lightning channel operates like a cryptographically guaranteed tab at a restaurant or bar at which a customer can order multiple items over time, which are paid when the customer decides to close the tab.

Users can open a Lightning channel with other users to send and receive transactions off the Bitcoin mainchain, thereby skipping on-chain fees. Only when the users open or close a channel, they pay a one-time fee to miners on the Bitcoin network.

Until now, Lightning channels on the LND framework were limited to a size of 0.1677 BTC. To ensure the safety of larger-scale Lightning channels, Lightning Labs has been running extensive tests over the past two years.

Upgrade Opens Up New Possibilities for Lightning

On August 20th, former Google manager and Lightning Labs developer Bryan Vu confirmed the launch of lnd 0.11-beta. 

The update removes the existing 0.1677 BTC constraints on Lightning channels, allowing LND users to operate bigger channels, dubbed Wumbo channels. Vu explained the upgrade's background in a blog post.

To keep your funds safu, Lightning channel sizes were limited to a maximum of 0.1677 BTC. After two years of hard work and extensive testing from the community, we have reached a point where we feel comfortable removing these constraints for those who want larger channels. With this release of lnd v0.11-beta, we now support Wumbo, channels over the 0.1677 BTC limit.

Vu noted that the Lightning Network had grown significantly since 2018. The continuous tests on the network and the increasing adoption of LND led the team to enable Wumbo channels, taking a “major step.” 

“Two years later, as the network has grown, matured, and been tested much more extensively, these limits have become less relevant for advanced users. A number of larger routing nodes, merchants, and service providers having already removed them from lnd by forking the code.”

The lifting of payment limits will make the Lightning Network more flexible and efficient for users and businesses, Vu stated.

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