BitGo adds lightning support via Voltage partnership

The move is expected to allow exchanges, fintechs, neobanks, and payment providers to access lower-cost and faster Bitcoin and stablecoin transactions through the integration. 

According to BitGo, the Lightning Network functionality will reduce transaction times and costs by up to 90% compared to standard Bitcoin on-chain transfers. The integration is intended to facilitate real-time payments for Bitcoin while laying groundwork for stablecoin transactions to be processed over the same network.

Support for institutional-grade infrastructure 

The partnership draws on BitGo’s experience in providing custodial and wallet services to institutional clients, which the firm says will be used to help financial institutions adopt the Lightning Network in a secure and compliant way. Representatives from BitGo indicated that expanding payment capabilities with scalable, lower-cost infrastructure aligns with client needs for more efficient asset transfers. 

Officials from Voltage noted that the collaboration enables wider access to Lightning Network tools by embedding them into BitGo’s existing platform. The addition of Lightning support is seen as an important step in extending Bitcoin’s utility in payments beyond investment and store-of-value use cases. 

The companies also suggested that future use cases may include support for stablecoins over Lightning, potentially opening new paths for real-time digital currency payments using existing Bitcoin infrastructure.

A closer look at the Lightning Network 

According to Investopedia, the Lightning Network is a second layer for Bitcoin that uses micropayment channels to scale the blockchain’s capability and handle transactions more efficiently and at a low cost. It is a technological solution designed to solve glitches associated with Bitcoin by introducing off-chain transactions. Its channel is a transaction mechanism between two parties in which each can make or receive payments from the other. 

Some of the main issues that the Lightning Network was designed to address include sluggishness in confirming transactions, high energy costs, and ensuring that designated recipients receive the funds they are entitled to.