So there's no on-chain transaction activity involved in this?

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Correct. No on chain bitcoin transaction with Lightning to Liquid swaps and vice versa. The liquid can be swapped back to lightning later on if needed, or to on chain for cold storage. It’s a good tool for balancing sats in and out of channels on your Lightning node especially in higher fee environment, or as a temporary holding place for a few sats until fees lower enough to swap back to on chain.

No **mainchain** bitcoin transaction