What is the Lightning Network?
Definition · Lightning Network
A network of payment channels built on top of Bitcoin. Each channel is opened and closed with a Bitcoin transaction, and payments inside it are signed balance updates between the two sides, so they don’t wait for blocks.
Think of a channel as a shared tab. You and a friend each sign every new balance, and either of you can end the tab at any time by publishing the latest one to the blockchain. Until then, you can pay each other as often as you like, and the blockchain never hears about it.
Try a payment channel
You and Sam share one channel. Pay back and forth, then close it.
0
Lightning payments
1
Blockchain transactions
Channel size stays 0.0005 BTC. Only the split moves.
- Channel opened with 0.0005 BTC from youon-chain
Nobody opens a channel with every shop and friend, though. The trick is that channels connect into one network, so a payment can travel through other people’s channels to reach anyone. More background is on the Lightning Network site and in our Bitcoin wallet guide.
Why is Lightning so fast and cheap?
A regular Bitcoin payment has to wait for a miner to put it in a block. Blocks come about every ten minutes on average, and when blocks are full you bid a higher fee to get in. That’s the security of proof of work at work, and it costs time and money for every payment.
Lightning skips that wait for everyday payments. The blockchain settles the channels, not each coffee.
Seconds
Typical Lightning payment
no block to wait for
~10 min
Average time per Bitcoin block
and more for extra confirmations
2
On-chain transactions per channel
one to open, one to close
Tiny
Routing fees
set by each node along the route
How does a Lightning payment reach someone you don’t have a channel with?
Your wallet finds a path through the network, channel by channel, and each node along the way passes the payment on for a small fee. It’s locked to a secret that only the recipient knows, so no node can keep the money: either the whole payment arrives, or nothing moves at all.
One payment, three channels
You
Sender
Passes on 0.00020003BTC
Node A
Your wallet’s node
Passes on 0.00020002BTC
Keeps 0.00000001BTC as a fee
Node B
A routing node
Passes on 0.00020000BTC
Keeps 0.00000002BTC as a fee
Recipient
Their wallet
Receives 0.00020000BTC
What is a Lightning invoice?
Definition · Lightning invoice
A one-time payment request, defined in BOLT 11. On Bitcoin mainnet it starts with lnbc, and it says who to pay, how much (if fixed), what for, and until when.
The decoder at the top of this page takes one apart. The start is readable: ln for Lightning, bc for Bitcoin, then an optional amount with a unit letter (m, u, n or p for milli, micro, nano or pico bitcoin). So lnbc20u means 20 micro-bitcoin, or 0.00002 BTC. After the last “1”, the rest is packed data: the time it was made, the payment hash, a description, the expiry and the recipient’s signature.
| Fixed-amount invoice | Any-amount invoice | |
|---|---|---|
| Looks like | lnbc20u1… | lnbc1… |
| Who sets the amount | The recipient | The payer |
| Good for | Shops, exact bills | Tips, withdrawals where the amount can change |
| Watch out for | Sending a different amount fails | Check the amount before you confirm |
Each invoice has an expiry. If none is set, it’s one hour. After that, wallets refuse to pay it, so make a new one when you’re ready rather than hours before. And don’t reuse an invoice: it’s built for one payment. The Lightning Labs invoice guide covers every field in detail.
What is a Lightning address?
A Lightning address looks like an email address, for example [email protected]. You can share it once and receive many payments. Behind the scenes, the payer’s wallet asks your provider’s server for a fresh invoice for the amount they choose, using a standard called LNURL-pay. Details are at lightningaddress.com.
Invoice · BOLT 11
lnbc20u1p4t0zvspp5qqqq…
- Made fresh for one payment
- Can fix the amount, or leave it open
- Expires, often after 1 hour or 1 day
- Works with every Lightning wallet
Lightning address
- Same address every time, like email
- The payer picks the amount
- Doesn’t expire while your provider keeps it
- Needs the provider’s server to be online
- 1
You share name@domain
Paste it anywhere a Lightning destination is asked for.
- 2
The payer picks an amount
Their wallet reads the address and asks your provider for payment details.
- 3
Your provider makes an invoice
A fresh one-time invoice for exactly that amount.
- 4
The wallet pays it
Over the Lightning Network, usually in seconds.
Custodial or self-custodial: which Lightning wallet is which?
A custodial wallet is an account: the provider runs the Lightning node and holds the funds for you. A self-custodial wallet runs a node on your phone or computer and you keep the recovery phrase. Both can send and receive the same Lightning payments.
Custodial
The provider holds the key
- Nothing to set up: no channels, no liquidity to manage
- Receiving works even when your phone is off
- Account recovery through the provider
- You rely on the provider to keep your balance and let you withdraw.
Self-custodial
You hold the key
- Only you can move the funds
- No account to freeze
- Many wallets manage channels for you
- Back up the recovery phrase. Some charge a fee to set up a channel when you first receive.
Our withdrawal tutorials cover wallets such as ZBD and Wallet of Satoshi, and exchanges like Kraken. We aren’t affiliated with any of them and don’t rank them, so read a wallet’s own description to see which type it is and what it charges. The bitcoin.org wallet chooser is a neutral place to start.
How do you receive bitcoin on Lightning?
- 1
Get a Lightning wallet
A wallet app, or an exchange account that supports Lightning deposits.
- 2
Tap Receive, then Lightning
Copy your Lightning address, or create an invoice for a set amount.
- 3
Give it to the payer
Copy and paste it, or let them scan the QR code. Never type it by hand.
- 4
Watch it arrive
Usually within seconds. An invoice that expires first has to be made again.
Why do Lightning payments sometimes fail?
Lightning is fast because it doesn’t wait for the blockchain, but a payment still needs a path with enough room in every channel along the way. When it can’t find one, the payment fails cleanly and nothing is lost.
No route
No path had enough room
Every channel on the way needs enough balance on the sending side. Large payments fail more often than small ones.
Liquidity
The receiver can’t take it in
A new self-custodial wallet may need a channel with room to receive. Many wallets set one up for you, sometimes for a fee.
Expired
The invoice ran out of time
Make a fresh invoice. Paying an old one is refused by design.
Mismatch
Wrong amount for a fixed invoice
A fixed-amount invoice only accepts that amount. Use an any-amount invoice or a Lightning address instead.
The fix is nearly always the same: make a new invoice and try again, or try a smaller amount. If a Lightning payment keeps failing, an on-chain payment is the slower fallback that doesn’t depend on channel liquidity.
Lightning vs on-chain: which should you use?
| Lightning | On-chain Bitcoin | |
|---|---|---|
| Speed | Usually seconds | About 10 minutes per block, often longer |
| Fee | Usually a tiny fraction of the amount | Depends on how busy blocks are |
| Destination | Invoice (lnbc…) or name@domain | Address (bc1…, 1…, 3…) |
| Best for | Small and everyday amounts | Large amounts and long-term savings |
| Recorded on the blockchain | Only channel opens and closes | Every payment |
You can see the difference in our own withdrawal fees, which follow each network’s real costs:
| Network | Fee | Minimum | Maximum |
|---|---|---|---|
| Lightning | 0.00000005BTC | 0.00000010BTC | 0.00004000BTC |
| Bitcoin on-chain | 0.00002944BTC | 0.00005888BTC | None |
| BNB Smart Chain (BEP-20) | 0.00001188BTC | 0.00002376BTC | None |
To compare BTC amounts in other units, use the Bitcoin unit converter. What a satoshi is, the smallest unit Lightning deals in, is explained in our satoshi guide.
How do you withdraw from CloudMineCrypto over Lightning?
In CloudMineCrypto you earn bitcoin from mining for free: claim the free plan, watch ads, play games, complete offers and check in daily, and your BTC balance grows while your plans run. Want more speed? A paid plan adds more hashrate, and it’s optional. When you’re ready, you withdraw to your own wallet, and Lightning is usually the lowest-fee way to do it. Bitcoin on-chain and BNB Smart Chain (BEP-20) are there too. Rewards are estimates, and terms apply.
⚡ Lightning withdrawals in the app
live, updated hourly
- Network fee
- 0.00000005BTC
- Minimum per withdrawal
- 0.00000010BTC
- Maximum per withdrawal
- 0.00004000BTC
Usually arrives in seconds once sent. The withdraw screen shows the current figures before you confirm.
- 1
Get a Lightning destination
In your wallet, tap Receive and pick Lightning. Copy your Lightning address or an invoice.
- 2
Open Wallet, then Withdraw
Choose Lightning as the network in CloudMineCrypto.
- 3
Paste and enter the amount
A Lightning address (name@domain), an LNURL or an invoice starting with lnbc all work.
- 4
Check and confirm
The fee is deducted from the amount you send, and it’s shown before you confirm.
Validated requests are processed automatically; some are reviewed. You need a verified email and a Google or Apple login, and limits or verification may apply. The withdrawals overview and the full withdrawal guide cover every network and error message.
Lightning tutorials with screenshots
- Lightning to ZBD wallet app
- Lightning to Wallet of Satoshi wallet app
- Lightning to Muun wallet app
- Lightning to Bitfinex exchange
- Lightning to OKX exchange
- Lightning to Kraken exchange
- Lightning to OKCoin exchange
- Lightning to Binance exchange
Examples only. We aren’t affiliated with these services; their own terms and fees apply.
Frequently asked questions
What is the Lightning Network in simple terms?
It’s a payment network built on top of Bitcoin. People lock bitcoin in shared channels on the blockchain, then pay each other by updating the balance inside those channels, which takes seconds and costs very little. Only opening and closing a channel is recorded on the blockchain.
Is Lightning the same bitcoin?
Yes. Lightning moves real BTC. The coins sit in channels that are secured by Bitcoin transactions, and they can be moved back on-chain by closing the channel.
What is a Lightning invoice?
A payment request, defined in BOLT 11, that starts with lnbc on Bitcoin mainnet. It can include a fixed amount, a description and an expiry time (1 hour if none is set), and it’s meant to be paid once.
What is a Lightning address?
A reusable address that looks like an email, for example [email protected]. The paying wallet asks the provider’s server for a fresh invoice each time, using LNURL-pay, so you can share one address instead of making a new invoice for every payment.
Why did my Lightning payment fail?
Usually because no route had enough liquidity, the invoice expired, or the amount didn’t match a fixed-amount invoice. A failed Lightning payment doesn’t move any money, so you can make a fresh invoice and try again.
Can I send Lightning to an on-chain Bitcoin address?
Not directly. A Lightning payment needs a Lightning invoice or Lightning address. An on-chain address (bc1, 1 or 3) needs an on-chain transaction, unless a service swaps between the two for you.
Can I withdraw from CloudMineCrypto over Lightning?
Yes. In the app go to Wallet, then Withdraw, pick Lightning and paste a Lightning address, an LNURL or a Lightning invoice from your own wallet. The fee, minimum and maximum are shown before you confirm. Limits or verification may apply.
Sources and further reading
- Lightning Network · Bitcoin Wiki
- Lightning Network: scalable, instant Bitcoin payments · lightning.network
- BOLT 11: Invoice protocol for Lightning payments · Lightning Network specifications
- Understanding Lightning invoices · Lightning Labs
- Lightning Address · lightningaddress.com
- Choose your Bitcoin wallet · bitcoin.org
Live figures on this page (network hashrate, block reward, BTC price) come from the CloudMineCrypto API, refreshed hourly, and are labelled where they appear. This guide is educational and not financial advice. CloudMineCrypto is not an investment product; rewards in the app are estimates and aren’t guaranteed.
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