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Advancements in Lightning Infrastructure
Unlocking Bitcoin's full potential as a global, peer-to-peer currency means building beyond the base layer. The Lightning Network is leading that charge—and thanks to dedicated open-source contributors, it's becoming faster, more secure, and easier to use every day. While the base layer ensures decentralization and security, higher layers with different trade-off characteristics are required to facilitate high-velocity micro-transactions, streaming payments, and everyday commerce. That’s where Lightning comes in.
OpenSats grantees are at the forefront of building this foundational infrastructure to enhance the Lightning Network's liquidity, interoperability, testing, and security. These advancements are critical to ensuring Bitcoin can function as a fast, reliable, and scalable payment system. We're highlighting the following projects supported by our General Fund, with funding rounds announced in December 2023, February 2024, and October 2024 respectively:
Let's explore the progress these projects made and the impact they're having on the Lightning Network.
Splicing
Splicing has long been recognized as a crucial upgrade for the Lightning Network, allowing users to dynamically adjust channel capacity without downtime. By removing the need to close and reopen channels, Splicing not only reduces friction and costs but also streamlines liquidity management.
Dusty Daemon, a Splicing pioneer and an OpenSats Long-Term Support recipient, highlights Splicing's impact on the Lightning Network:
For the typical user, this means a near doubling of the capacity to move liquidity through the network. The increased liquidity flows improve all aspects of Lightning including payment speed, payment fees, and payment reliability.
Since receiving his grant, Dusty has advanced Splicing interoperability across multiple implementations, successfully testing it between Core Lightning (CLN) and Eclair. By resolving protocol-level inconsistencies, his work marks a major step toward universal Splicing adoption across the Lightning ecosystem.
Beyond direct interoperability, Dusty has introduced Splice Script, a structured scripting language that allows users to automate and optimize liquidity management tasks—such as batching on-chain movements or scheduling transactions based on fee conditions. The integration of its parser, compiler, and validator into CLN has transformed Splice Script into a practical tool for both node operators and application developers. Additionally, the Splice Solver component helps streamline transaction construction, reducing errors, and making complex Splicing operations more accessible.
The impact of these enhancements goes beyond just payment channels. By making on-chain transaction logic more efficient, Splicing and Splice Script pave the way for improved privacy in Bitcoin transactions, including Coinjoins and Payjoins. As Dusty explains:
The dream of higher-privacy decentralized on-chain coin sharing is brought ever so closer to reality with these improvements. These privacy projects have always been separate from Lightning but Splicing makes it possible to merge them together, creating a larger base from which to derive anonymity.
As regulatory pressures mount, building resilient, decentralized infrastructure is more important than ever. These enhancements reinforce self-custody and censorship resistance to ensure Bitcoin remains a tool for financial freedom.
In addition to supporting Dusty's work on Splicing, OpenSats has also funded an initiative to integrate Splicing into LDK. Over the past several months, efforts to integrate Splicing into LDK have yielded meaningful strides that led to a key breakthrough: the integration of Interactive Transaction Construction. This feature closely ties in with Dual Funding, a mechanism that allows two participants to collaboratively open channels. Because Splicing and Dual Funding share underlying transaction logic, progress on one directly benefits the other.
As part of the ongoing effort to integrate Splicing into LDK, project developer Optout has been conducting end-to-end testing in ldk-sample, and ldk-node-sample, assessing stability and readiness for integration. Although several foundational pull requests have been merged, further work is needed to finalize integration into LDK and ensure interoperability before Splicing is fully production-ready within LDK. Once complete, it will bring a substantial improvement to how wallets and applications manage Lightning liquidity, reducing on-chain costs and making user experiences more efficient.
With Splicing integration in LDK progressing steadily, Optout's work and Dusty Daemon's expanded tooling are converging to shape the future of Lightning liquidity management. LDK's next milestones include finalizing message handling and broader interoperability tests, while Dusty is pushing forward with Transaction Intention Language (TIL)—a feature that further automates collaborative transactions and channel rebalancing.
With Splicing adoption continuing to grow and Splice Script steadily maturing, these projects are continually making the Lightning Network more efficient, private, and accessible for all users.
Validating Lightning Signer (VLS)
Securing private keys is one of the most critical issues in Lightning node operations. Traditionally, Lightning Network implementations store private keys directly on the node for transaction signing, exposing them to potential compromise in the event of a security breach. Validating Lightning Signer (VLS) addresses this vulnerability by shifting key storage and transaction validation to an external signer, ensuring that even if a Lightning node is compromised, an attacker cannot access or misuse private keys to steal funds. This separation significantly improves security without diminishing the flexibility or performance required for effective Lightning Network operations and management.
Since receiving OpenSats funding, VLS has made important advancements for both individual users and enterprise deployments. The release of Beta 3 introduced tag-team signing functionality, allowing multiple signers to authorize transactions. The update also optimized performance, refined monitoring capabilities, and introduced a Dockerized deployment model, streamlining integration for developers and businesses seeking dependable Lightning security.
VLS has also expanded its footprint within the broader Lightning ecosystem through various integrations. Notably, the project created lnrod, a reference implementation that facilitates VLS compatibility with LDK-based nodes, broadening its usability for developers building on the Lightning Development Kit. Another major step forward was VLS's integration with Greenlight, a hosted Lightning node service run by Blockstream, which powers secure transaction signing for Breez, Relai, and several other Lightning businesses. By providing enterprise-grade security for Greenlight's implementation, VLS has helped strengthen the security model of remote node hosting, an area of growing interest for enterprises and custodial service providers. As Christian Decker, Core Engineer at Blockstream put it:
VLS allowed Greenlight to be developed at breakneck speed, without the risk. It is the fundamental building block, and central to the non-custodial nature of Greenlight.
Looking ahead, VLS aims for full mainnet readiness within a year, with plans to add support for new Lightning features like splicing and dual funding. The team is also focusing on helping enterprises to confidently manage millions in channel funds. Additionally, planned developments include improved support for routing and security features such as VLS running on secure enclaves. In the future, the project aims to introduce multi-sig capabilities for Lightning transactions, further strengthening security for high-value and institutional use cases.
Through these advancements, VLS pushes the boundaries of what's possible in Lightning Network security, ensuring that Bitcoin's most widely used and developed Layer2 scaling solution remains secure.
BLAST
Lightning Network interoperability has been an ongoing concern, with each implementation—CLN, LND, and LDK—introducing variations in channel policies, default settings, and routing strategies. This has led to inconsistencies, creating friction for users and developers alike, ultimately making seamless payments across the network more difficult than they should be. Addressing this requires more than just improvements to individual implementations; it demands independent testing tools capable of evaluating interoperability across the entire Lightning protocol. BLAST (Big Lightning Automated Simulation Tool) is designed to provide a stable modeling and simulation framework for the Lightning Network, giving researchers, developers, and node operators a large-scale testing environment that more accurately reflects real-world network conditions.
With OpenSats support, BLAST has achieved the ability to support all three major Lightning node implementations—CLN, LND, and LDK—making it one of the only interoperability-focused testing tools to do so. Unlike traditional test environments that require running multiple separate node processes, BLAST introduces a new approach where all nodes operate within a single process. This reduces computational overhead and enables efficient, large-scale simulations without the usual resource constraints. LND nodes, for example, are now run as goroutines within a single process, allowing for a lightweight yet comprehensive testing setup. By eliminating unnecessary complexity, BLAST improves protocol testing, helping developers identify weaknesses, optimize routing strategies, and refine implementation behaviors with greater accuracy.
This advancement also enables more rigorous testing of interoperability at scale. Using BLAST, developers can now simulate real-world Lightning Network environments to analyze how different implementations interact under various conditions. Routing node operators can leverage these simulations to optimize liquidity allocation, fee structures, and channel management strategies. Project lead Blake Johnson emphasizes the importance of interoperability testing:
Interoperability between different Lightning Node implementations continues to be a major pain point of the Lightning technology. Different channel policies, default settings, and routing strategies create friction when attempting to make payments. This is why it is so important to have independent developers building testing tools and researching the health of the protocol as a whole.
Looking ahead, BLAST is preparing for the next development phase, focusing on creating lightweight models for different LN implementations, followed by automation features that support reproducible network states. Incremental improvements will continue rolling out, ensuring that BLAST remains a meaningful tool for interoperability research. As Lightning adoption grows, the need for independent, large-scale testing frameworks will only become more critical, and BLAST is helping to lay the groundwork for a more well-structured Lightning Network.
Lampo
As the Lightning Network evolves, the need for modular, open-source node implementations has become increasingly clear. Existing implementations often come with trade-offs that limit flexibility for developers seeking highly customizable solutions. Addressing this gap, Lampo provides a modular, community-driven alternative, built on the Lightning Development Kit (LDK).
With support from OpenSats, the project has achieved a significant milestone by contributing to the integration of LDK with lnprototest, a test suite designed to rigorously validate Lightning protocol behavior. This work enhances LDK's reliability, ensures adherence to Lightning standards, and strengthens its overall robustness, giving developers greater confidence when testing their implementations. A key part of this effort was the launch of the ldk-lnprototest package on PyPI. This package provides a runner that facilitates the integration of LDK with lnprototest, enabling automated and standardized testing. By reducing the risks of protocol inconsistencies and implementation errors—challenges that can significantly impact Lightning's reliability—this tool ensures a more robust and predictable development process for LDK-based implementations like Lampo.
Building reliable Lightning infrastructure requires both rigorous testing and continuous improvements. The LDK-Lnprototest integration and enhancements to Lampo aim to make the network more robust and developer-friendly. Excited to push this forward!
—Prakhar Saxena, Lampo Project Lead
In addition to improving the Lightning testing environment, Lampo has also introduced improvements to wallet security and usability. Previously, users had to manually enter their BIP39 seed words in the command line every time they restored a wallet, posing privacy risks and reducing usability. Now, Lampo securely stores and manages wallet restoration data in a binary file (wallet.dat), eliminating the need for repeated manual entry and improving the user experience without compromising security.
Together, these improvements make Lampo both a reliable development tool and a more secure node implementation.
Looking ahead, Lampo plans to continue its evolution by implementing a proof-of-concept for Validating Lightning Signer (VLS), a move that will further improve security by enabling external validation of Lightning signatures. Future updates will also introduce a PoC of a plugin system, and expand documentation to encourage broader adoption. By fostering a truly open-source, modular approach to running a Lightning node, Lampo is carving out a space for greater experimentation and innovation in the Lightning ecosystem.
Lnprototest
The Lightning Network's success depends, in part, on seamless interoperability between different implementations such as CLN, LND, and LDK. However, ensuring that protocol changes don't break compatibility across implementations is a constant challenge. Without a standardized and rigorous testing framework, even small discrepancies in how nodes interact can lead to fragmentation, payment failures, and reliability issues.
To solve this, lnprototest provides a Python-based testing library that helps developers validate protocol adherence across different implementations, ensuring cross-compatibility and preventing regressions before they impact real-world users.
Initially launched in 2019 as a monolithic application, lnprototest has since undergone a significant transformation into a modular library, making it more accessible and adaptable for a wider range of Lightning developers. With its availability on PyPI, the project now allows for custom testing setups tailored to specific implementations, reinforcing its role as a vital infrastructure component for the Lightning Network.
With OpenSats support, one important advancement made has been the introduction of out-of-tree testing, which allows tests to reside within an implementation's codebase rather than being confined to the lnprototest repository. This not only reduces clutter but also improves scalability, enabling projects to maintain their test suites while still leveraging the standardized framework. Additionally, the development of custom runners—such as LampoRunner—demonstrates how implementations can tailor the testing process to their specific needs, further improving flexibility and usability. These refinements make lnprototest a more powerful tool for ensuring protocol compliance and catching issues before they impact users.
By providing a stable and modular testing environment, lnprototest plays a crucial role in safeguarding the reliability of the Lightning Network. Without a rigorous testing framework, protocol changes risk breaking interoperability between implementations, leading to fragmentation. This library mitigates that risk by offering developers a consistent way to validate protocol adherence, helping prevent subtle bugs that could undermine network performance. As the project lead describes it, "lnprototest allows another kind of testing that I define as vertical testing of the Lightning Network implementation," underscoring the project's focus on deep, structured validation at the protocol level.
Looking ahead, the project is focused on expanding its capabilities to support an even broader range of test scenarios and implementations. Collaboration with key contributors will be essential in refining the framework and ensuring its adoption across all major Lightning Network implementations. With continuous improvements, lnprototest aims to strengthen the protocol's foundation, reinforcing interoperability and resilience as the Lightning Network continues to scale.
The projects highlighted above represent just a small sample of the 250+ grants OpenSats has given—several of which have made significant advancements in Lightning infrastructure. These contributions have enabled developers to create new wallet and node implementations that leverage the latest Lightning features—ultimately improving the user experience for Lightning payments.
Our grantees have already proven the power of interoperability by integrating their technologies into each other's projects—demonstrating how these innovations work as modular building blocks of the Lightning Network.
The future of Lightning as a scalable, permissionless payment system depends on continued open-source innovation and collaboration. OpenSats remains committed to funding the builders pushing Bitcoin's second-layer technology forward, ensuring a more decentralized, scalable, and secure Lightning ecosystem.
If you believe in making Bitcoin a truly global, secure, and censorship-resistant financial system—fueled by second-layer solutions like the Lightning Network—we invite you to support OpenSats. Every donation—no matter the size—directly fuels open-source development, empowering people worldwide to transact freely and securely. Together, we can build a future where Bitcoin remains open, accessible, and unstoppable.
If you are a developer working on open-source software that makes Lightning even better than it is today, don't hesitate to apply for funding.