I think your correct Phoenix does this all automatically but yes if a new channel is made the fee is higher usually 3,000 sats
Discussion
Interesting. So keeping inbound txn to Pheonix under its current balance avoids the additional channel creation/fee?
Not that 3k is the end of the world - just trying to understand. Thanks y’all for helping
I’m not sure exactly how it works in the back end but basically yes Phoenix manages the channels automatically. When you use the wallet often the fees are typically low. Not as low as WoS to WoS but the trade off is you actually have custody of your coins unlike WoS which you do not.
For sure. Huge perk to get it into self custody - worth it even if it opens a new channel. Thank you sir 🙏🏽
Not exactly keeping inbound under the current balance, but max capacity. For example, if you initially fund Phoenix (or any LN channel) for 100,000 sats, that is the maximum capacity you’ll ever be able to have in that channel.
If you spend the channel down to 90,000 sats, you now have a maximum inbound capacity of 10,000 sats. If someone were to send you 15,000 sats, Phoenix would open a 2nd channel to be able to receive the 5000 sats your 1st channel cannot handle.
I drew this up real quick. Hopefully it’s helpful. With Phoenix your phone is actually running a node with channels to another node. A channel has a total fixed size that is the combination of your balance and their balance. Your balance is what’s in your wallet that you can send (outbound liquidity). The rest is on their side, and that’s how much you can receive with that channel, (inbound liquidity). If you try to receive a payment larger than your available inbound liquidity, then Phoenix automatically opens a new channel that can handle it instead of you having to do that manually. Remember the balance/liquidity shifts as you send/receive. So sending 100k sats to someone means your balance decreases by 100k, but it also means you can receive 100k more sats inbound than before, and vice versa.
Super super helpful! The visuals are appreciated too.
So it’s never a static number then - it always is in some sort of flux depending on my balance, the partner balance and how much has been sent/received.
Basically, always check liquititty before moving from one wallet to Pheonix to ensure proper equilibrium.
Yes correct it fluctuates. With Phoenix your channels are private channels, so you sending and receiving is the only thing that makes those balances fluctuate. If we were talking about a routing node with public channels, then it gets a little more complex, but you don’t need to worry about that for this circumstance. If I remember right Phoenix has a nice little screen in the settings that displays all your channels and inbound vs. outbound. I use Breez, which works the same way, and occasionally I send some of my balance to another wallet (or even to an on chain address if fees are low enough) to give myself more inbound liquidity. Sometimes the new channels are unavoidable tho.
