• Can Ethereum 2.0 outperform Lightning Network in terms of scalability?

  • The two most popular cryptocurrencies, Bitcoin and Ethereum, are frequently contrasted, and the discussion over which network is superior is never-ending. While each has its own set of advantages, they also have certain inherent challenges, one of which being scalability. While Lightning Network, a layer 2 payment protocol built on top of Bitcoin, addresses this issue, Ethereum’s response is ETH 2.0.

    The Bitcoin Lightning Network is gaining popularity.

    The Lightning Network (LN) just reached a new milestone when it surpassed the 25k node mark. The network is becoming stronger as engagement on LN grows, which is observable on the network itself. The total amount of Bitcoin in the channels was 2370.588 BTC, which is worth over $111.5 million. This contributes to increased network liquidity.

    Furthermore, network utilization has increased at an astounding rate in the last four months, with 63k unique channels and 4.6k recurrent channels. These values, however, are still far lower than those required for BTC to become a financial instrument. Ethereum thrives in this area.

    Is ETH 2.0 on its way to victory?

    As of now, Ethereum does not have a Layer 2 scaling solution. The network hopes that with ETH 2.0, it will be easier to address this issue. The distinction here stems from the fact that ETH has a greater number of adopters than BTC. Over 7.1 million ETH ($23 billion) is currently pledged in ETH 2.0 deposit contracts, which pales in comparison to LN’s total BTC presence of 2.3k.

    Second, ETH has a more solid user base. Despite the fact that Bitcoin has 869 million addresses, only 4.3 percent (38 million) of them have funds in them. ETH, on the other hand, has just 189 M addresses, yet at least 31% of them have some balance.

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