Technical modifications necessitated the suspension of the Kraken Lightning Network feature for German consumers.
Kraken eliminated the Lightning Network’s accessibility for its German clients, attributing the decision to “technical modifications.” Initially, it was believed that the change was due to regulatory concerns; however, Kraken has since clarified this misconception.
On Friday, Protos, a cryptocurrency news outlet, reported that the Kraken Lightning Network support agent blamed “regulatory issues” for the situation. Nevertheless, Kraken’s spokesperson has informed Decrypt that this information is inaccurate. The exchange subsequently informed the media outlet that the reason was “technical adjustments,” without providing any additional details.
Bitcoin’s Lightning Network is an off-chain scaling solution that facilitates rapid and more cost-effective transactions. It utilizes side channels to execute transactions, allowing users to establish smaller payment channels without involving the blockchain’s primary network, which ultimately resolves the transactions in aggregate.
Users who are interested in making modest purchases with Bitcoin at a significantly reduced cost have found the feature to be the most appealing. It is capable of accommodating approximately 5,200 BTC and is the primary feature that customers sought in order to facilitate transactions at a quicker pace and at a reduced cost.
Kraken emphasized that, despite their efforts to offer cutting-edge services, a reliable and secure platform for clients in Germany may necessitate making challenging decisions.
“We regrettably must occasionally make difficult decisions to guarantee that we can provide a secure and dependable platform for the maximum number of clients in Germany,” the organization stated.
The Kraken Lightning Network was announced in 2021; however, it was not implemented until 2022. A significant number of users in Germany had already embraced the network due to its privacy-centric approach. Kraken is experiencing legal complications in the United States, where the Securities and Exchange Commission (SEC) is pursuing legal action against the company for purportedly operating an unregistered securities exchange. This litigation extends beyond Germany.
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