Amboss, a leading data analytics provider for the Bitcoin Lightning Network (LN), has introduced a subscription service named Hydro. This service aims to automate liquidity management for the LN, making it easier for businesses to receive payments through the Lightning Network without requiring expertise in LN operations or giving up custody of their funds.
Hydro simplifies the payment liquidity process on the Lightning Network by automating the sourcing of payment liquidity directly to a business’s LN node from decentralized sources. As more businesses adopt the Lightning Network, the circular economy grows and results in increasingly cost-effective Lightning payments, with fees dropping from an initial 3.5% setup cost to as low as 0.003% for subsequent payments.
Jesse Shrader, Co-Founder and CEO of Amboss, highlights the transformative potential of Hydro, stating that it enables businesses to benefit from the lightning network without trusted custodians, intermediaries, or the hassle of channel management.
In the past, sourcing liquidity for businesses on the LN has been challenging, as entrepreneurs often lack the time and expertise required to manage an LN node. This has slowed down the adoption of Lightning for retailers using full nodes, leading them to rely on trusted custodians and compromising some of the privacy and sovereignty advantages offered by Bitcoin. With Hydro, businesses can access the full benefits of LN adoption without these drawbacks.
Hydro utilizes Amboss’s marketplace, Magma, to obtain high-quality liquidity from an open market. Magma allows Bitcoin savers to earn BTC by opening Lightning channels to various destinations, while Lightning channels enable self-custodial Bitcoin holding. This provides Bitcoin yield opportunities without custodial risks, avoiding the pitfalls experienced by centralized finance (CeFi) yield platforms.
The functionality of Hydro involves purchasing select Lightning channel leases that meet specific quality criteria at the lowest available prices. Users can customize their desired node size and channels will be automatically procured using prepaid Amboss credits known as “ambucks.” Users also have the option to set a target inbound liquidity, facilitating cost-effective and needs-based channel management.
Amboss’s Hydro aims to reshape the Bitcoin Lightning Network, making it more accessible and user-friendly for businesses, driving wider adoption, and fostering the growth of a decentralized payment ecosystem. To learn more about Amboss or subscribe to their comprehensive Lightning Network insights, services, and more, visit their website here.