Data from MemPool Space on August 2 indicates that the two largest centralised cloud service providers, Amazon Web Services (AWS) and Google Cloud, hold around 48% of all Bitcoin Lightning Network (LN) Nodes.
Exact numbers vary, but somewhere about 29% of Bitcoin Lightning Network nodes are hosted on AWS and around 19% are hosted on Google Cloud. This pattern demonstrates the increasing dependence of Bitcoin Lightning Network node operators on third-party cloud storage and processing services.
Centralized systems, as opposed to locally managed nodes, may provide near-perfect availability and dependability.
Miners from all across the globe run nodes on the Bitcoin network. This is in contrast to the centralised methods used by Google Cloud and Amazon Web Services. Even while mining farms and pools account for the vast majority of Bitcoin mining, there are still thousands of individual miners spread out over the world.
An inherent difficulty in the Lightning Network design is highlighted by the fact that nodes powering the Bitcoin Lightning Network are predominantly installed on Google Cloud and AWS. Lightning Network node operators must be available at all times to conduct off-chain Bitcoin transactions via channels, which allows for practically immediate settlements and cheaper costs.
In order for smart contracts to be updated, transactions must be initiated when both parties are active on the Lightning Network. The channel’s money might be lost if one side doesn’t answer. To circumvent this, many operators of individual nodes turn to centralised cloud services, such as Google Cloud and Amazon Web Services.
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