Kraken announces support for the Lightning Network

The integration enables traders on Kraken to move Bitcoin on and off the platform quickly and inexpensively.

The Lightning Network is a scalable layer two payment protocol built over the Bitcoin blockchain that allows for instant transactions and low fees. LN is often referred to as a routing network, which means that instead of a direct transaction between two parties, the payment goes through common peers, similar to the Tor browser. The intermediate transactions are kept off-chain, enabling users to send micropayments not normally possible or affordable on a blockchain.

Kraken claims that due to the system of common peers, the Lightning Network can process millions of transactions per second compared to Visa, capable of handling 65,000 TPS. The integration of the protocol was postponed for over the year, as Kraken first announced the planned support for the Lightning Network in December 2020.