How to use the Lightning Network with Hardblock
The Bitcoin Lightning Network is a layer two protocol which facilitates fast, near-instant bitcoin transfers, making it ideal for small payments. "Layer two" means that it sits on top of the base layer of the bitcoin network - transactions on lightning channels move value back and forth but are eventually settled on the bitcoin base layer on-chain.
To use lightning with Hardblock to send bitcoin, you need to be dealing with a recipient wallet (could be your own custodial wallet, or a third party such as a business or person you are sending funds to) that can generate a lightning address (or invoice) for you to input into the lightning send interface on Hardblock.
Similarly, to receive lightning on your Hardblock account, the wallet you are receiving funds from must be capable of sending lightning transfers. Some wallets (such as Sparrow) are on-chain (the base layer) only, and so that bitcoin would need to be sent to a wallet with lightning functionality before it can be sent over the lightning network.
Finally, please note that Hardblock only supports sending to or receiving from self-custodial lightning wallets. Sending to or receiving from a custodial lightning address is against our terms and may see your account closed down.
Sending Bitcoin via Lightning
First, navigate to 'Send' under the Bitcoin menu once logged into your Hardblock account. Note that your account needs to be verified in addition to 4 days passing from your first AUD deposit before you will be able to send any bitcoin.
Then, select 'Lightning'. You will then be presented with a field where you can input a lightning invoice or scan a QR code. If you are sending bitcoin via lightning in-person, you'd want to access this on your phone so that you can easily scan the recipients lightning address or invoice.
Please be aware that some lightning address QR codes can be temperamental, and might require a few attempts before the code will scan.
Once the address is inputted, add your amount in either BTC or AUD, and hit send. The network fee will be shown once you have inputted an address. If you have 2FA enabled - you will be prompted to input a code from your authenticator app.
Receiving Bitcoin via Lightning
First, navigate to 'Receive' under the bitcoin menu once logged into your Hardblock account. Then hit 'Lightning' and you will be presented with a lightning address QR code and string:
Simply scan that QR code with a lightning wallet or copy and paste the lightning address to deposit bitcoin via the lightning network into your Hardblock account.
Optionally, you can set up a lightning invoice for a specific amount by hitting 'Edit'.
You can then input a specific amount, say $100, and then hit Generate Invoice to create a lightning invoice for that amount of bitcoin.
The Description field helps you to track payments, as well as indicate to the sender what the invoice is for.
Once generated, QR code followed by an address will be presented. You can then scan this QR code with the sending device, or copy the address and send to the user or device you are sending the lightning transaction from. Keep in mind that the wallet making the transaction must be able to make lightning transactions - some wallets are bitcoin base layer (on-chain) only.
What fees are involved with Lightning sends?
When sending on the lightning network via your account, the fee is 0.4% plus 1 sat (1 sat = 0.00 000 001 BTC). This makes it ideal for very small amounts of bitcoin. For larger amounts, consider using a regular bitcoin transaction.
You will find that outside Hardblock, lightning network routing fees are unique to each send and depend on the amount being sent, and the destination - so your mileage elsewhere will vary depending on the lightning wallet you use.
Receiving bitcoin via the lightning network to your Hardblock account will incur a 0.3% fee on the amount sent.
Troubleshooting Lightning Network Transactions
The Bitcoin Lightning network is an established part of bitcoin, but can be subject to the occasional problematic transaction. This is usually due to the particular wallet you might be using may not play nicely with our (or other) infrastructure, particularly if it is a fairly new app or wallet that hasn't completely ironed out all the intricacies of the protocol.
If you're having trouble, first consult the docs of the lightning wallet you are using to send or receive bitcoin via lightning from/to your Hardblock account. If you are having trouble using an LNURL, try using a generated invoice. Similarly, if you're having trouble with an invoice address, try an LNURL. If you're still having trouble, reach out to our support inbox for help.