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Video: Bitfinex CTO Paolo Ardoino on Adding Lightning Network Support

On December 2, 2019, Bitfinex officially informed its subscribers that it had added support for Lightning Network deposits and withdrawals. Subsequently, Bitfinex CTO Paolo Ardoino confirmed the information in a tweet. A few days before this announcement, Ardoino agreed to do an exclusive interview with Bitcoin Magazine to provide more technical details about the Lightning integration. This marked a big step in the development of Bitcoin and the Lightning Network, as a major exchange finally integrated second layer satoshis.“I think that Lightning is definitely the best way to send and receive bitcoins,” said Ardoino during the opening of the interview. “For me, [the Lightning Network] is exactly how the perfect payment system should be built.”How Bitfinex Integrates Lightning NetworkIn regards to the process that users will have to follow in order to send their Lightning satoshis to Bitfinex, Ardoino described a system during which the exchange issues a proprietary intermediary token. “The process is simple: you go on the Lightning Network deposit page, you generate an invoice, and then pay it with any Lightning wallet that you may use,” he said. “Bitfinex will credit you LNX, our proprietary Lightning Network currency, and then you can exchange it on a 1 to 1 ratio for bitcoins.” Bitfinex will not charge a premium for exchanging second-layer satoshis for mainchain BTC (or vice versa). However, withdrawals will have the regular fees. “There is no premium in this step,” said Ardoino. “However, we will apply a small fee when you process a withdrawal in the opposite way. But that’s it, we don’t apply any premium or any conversion rate for the service.”From a technical point of view, Bitfinex makes use of lnd — the client developed by Lightning Labs. However, as acknowledged by Ardoino, Blockstream’s c-lightning is regarded as a worthy replacement in the near future. “Right now we are running LND, but we are planning to add c-lightning,” he said. “I like the c-lightni...
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