Fees have been wild lately so I'm dropping this here again. This is my current flow using both liquid and lightning to minimize my on chain footprint while still saving and spending every day.
Discussion
Yo liquid adoption is upon us?
I kinda hope so. There's a trade-off, but it's better than a custodial lightning wallet or an exchange, plus you can secure it with hardware. Then peg out when your balance builds up!
would love to use my tapsigner with liquid
That is assuming you can get lighting bitcoin to begin with
Not necessarily. In my example I withdraw from an exchange that covers the on chain fee (because they batch txs) and sent directly to a liquid peg-in address.
I also detail how to only get hit with one on chain fee to establish a large channel to Phoenix wallet, then hopefully never have to worry again.
This flow works great with Lightning exchanges like Robosats. Safely stack sats every week while minimizing on chain fees. Brilliant!
Agreed. For the payout invoice in Robosats, I create a Boltz swap, past the Lighting address in Robosats, and complete the trade.
Robosats pay Boltz's invoice and Boltz sent L-BTC to my L-BTC address.
If the invoice expires before the trade is completed, I created a new swap and enter the new LN address in Robosats. Robosats will try 3 times to pay the invoice before a new address can entered.
Why not skip the liquid peg-in and send the BTC to boltz and swap for ln? Am I missing something or is it just to have liquid in self-custody?
The main thing is that will self custody lightning you'll be hit with on chain fees to gradually grow the size of your channel via splicing each time you receive. Letting it build on liquid then doing a large swap to lightning will only incur one on chain fee to create a fat channel to your Phoenix wallet.
Awesome tutorial. What are your thoughts on the privacy aspects of this flow? Can it replace coinjoin?
And one day all these steps will be as simple as send/receive. The beauty of code
Hope for mortals using & hodling moderate to small amounts.
I definitely need to do more research into liquid. It seems that it requires not only trust in the federation, but also that green wallet remains viable, even though they failed wallet scrutinys binary check:
https://walletscrutiny.com/android/com.greenaddress.greenbits_android_wallet/
Side swap didnt do well on that list for different reasons
Shit thanks for the heads up
Thanks for this! One question is, why not withdraw direct from Bull to Blockstream Green/Jade?
I’m sure I’m missing a simple point here but I don’t understand the Liquid hop in between there 😅 Oh wait, it’s for the privacy right?
There are only few exchanges that offer L-BTC. So most of the audience will be acquiring BTC first. That's why he shows the BTC to L-BTC peg-in. Not everyone is lucky to have access to Bull Bitcoin.
Thanks, but the part I was confused about was why exchange > liquid > cold storage..
Why not just exchange > cold storage? Then realized probably to have the privacy step of L-BTC in the middle, is that the reason (assuming as you say folks don’t use an exchange with liquid)?
and volume
If you buy small amounts overtime, let say $50 weekly and send to your ColdCard, you will have to pay on-chain transaction fees to consolidate your UTXOs or top up you Lightning balance, which lately could be anywhere between 30 sat/vb and 500+ sat/vb.
On Liquid it's 0.1 sat/vb. That's why it best to stack on Liquid, top up LN and when it make economically sense, you go on-chain.
I like to refer to this Unchained article to size my on-chain UTXOs.
Any idea for similar exchanges for Europeans ?
Thanks Ben 🫡
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Always Ben with the fire 🔥 content.
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Thank you for being one of the key resources helping me understand liquid beyond the fud