Routing Fee Adjustment Strategies in Payment Channels

Offloading payments from the blockchain to increase transaction throughput (tps) is a common technique that has been applied to several mainstream cryptocurrencies. In layer 2 solutions, this approach necessitates payment forwarding nodes owing to the fact that the resulting payment channel graph is not always complete, i.e., some participants might not have direct payment channels between each other. This leads to a routing problem and the solution to it is not straightforward. In this work, the efficacy of the source routing scheme of the Lightning Network is investigated. The authors show that the total routing revenue increases when the participants follow a common strategy. Several strategies are proposed and their performance is evaluated using a simulator on a filtered snapshot of the Lightning Network.