The most recent BitMEX report release on the Lightning network has revealed that its cost since inception might have outweighed the benefits. This Bitcoin oriented network was designed to facilitate fast and cost-free transactions as an extra layer in both private and public networks.

Source - - The growth of the lightning network over the last 2 years

However, the tech’s convenience in both privacy and scalability is now in question after the BiTMEX report which showed a significant loss of BTC due to node inefficiencies.

Non-Cooperative Node Closures in Lightning Network

Source: BitMEX Research - Total number of non-cooperative lightning channel closures per month (Upper bound)

Statistics gathered by BitMEX during the research indicate that the number of non-cooperative channel closures was double the figure expected. This was obtained from Lightning P2P gossip networks like and Coinmetrics. According to the data, close to 60,000 node transactions within the Lightning network have failed to meet the requirements of effective closure. This came as a surprise given that the analysts speculated only 30,000; a non-cooperative closure normally results in a breach or non-breach that could be penalized although rarely.

BiTMEX further stated that over 1000 BTC has been lost due to the communication hitches between nodes that initiate the closure of payment channels and their linking channels. Also, the perception that cooperative closures are more common in both public and private lightning networks might change given this analysis by BitMEX. It was however notable that the number of non-cooperative closures reduced during Q4 in 2019 while more users joined the public channels. This could mean that more Lightning network users are getting better at transacting with digital wallets over time.

Penalties for Breaches in Lightning Network

Non-Cooperative Closures within this BTC transaction layer ecosystem can result into three categories; Non-penalty sweep, Penalty Sweep and No sweep transaction. BitMEX was able to identify over 59,000 channel closure transactions with a total of 1074 BTC exchanged. Non-closure transactions, on the other hand, stood at 90,000 having transacted 1405 BTC.

The data analyzed by BitMEX highlighted both penalized and non-penalized closure breaches. This was however minimal given that only 0.30% non-cooperative closures have gone to the extent of being penalized. Based on the node closure stats, one could deduce that the gross number of BTC flowing within the Lightning network is at 4,000.