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Abstract:The Lightning Network (LN) is a rapidly evolving payment channel network that enables scalable, off-chain transactions on top of Bitcoin. While prior research has documented its topological structure and liquidity concentration, the joint relationships between node lifetime, connectivity, and capacity remain insufficiently understood. This study provides a comprehensive empirical analysis of these relationships using a large-scale dataset of LN topology snapshots spanning the period 2019-2023. We examine whether node lifetime influences shared channel capacity, and whether this effect is mediated and moderated by node degree. In addition, we account for hierarchical geographic structure and explore the role of country-level economic conditions. The results show that node lifetime has a positive but relatively modest direct effect on capacity. This relationship is largely mediated by node degree, indicating that liquidity accumulation primarily occurs through increased connectivity. Furthermore, the interaction between lifetime and degree reveals significant heterogeneity, with stronger effects observed among highly connected and high-capacity nodes. Mixed-level models demonstrate superior explanatory power, highlighting the importance of country- and region-level variation. The inclusion of GDP per capita confirms that broader economic conditions significantly influence capacity distribution. Overall, the findings suggest that liquidity in the LN emerges from the interplay of temporal dynamics, network structure, and economic context. This study contributes to a more integrated understanding of payment channel networks and provides a foundation for future research on their evolution and efficiency.

Submission history

From: Danila Valko [view email]
[v1] Tue, 21 Apr 2026 09:11:33 UTC (129 KB)