Inbound vs Outbound Liquidity Explained
Learn the difference between inbound and outbound liquidity, and when you need each type.
Understanding the difference between inbound and outbound liquidity is crucial for managing your Lightning node effectively. Here's everything you need to know.
The Two Sides of Every Channel
Every Lightning channel has two sides – yours and your peer's. The Bitcoin in the channel can sit on either side, and this determines what you can do:
┌─────────────────────────────────────────┐
│ Lightning Channel │
├───────────────────┬─────────────────────┤
│ YOUR SIDE │ PEER'S SIDE │
│ (Outbound) │ (Inbound) │
│ │ │
│ ████████░░░░ │ ░░░░████████ │
│ 600,000 sats │ 400,000 sats │
│ │ │
│ Can SEND → │ ← Can RECEIVE │
└───────────────────┴─────────────────────┘
Outbound Liquidity (Sending Capacity)
Outbound liquidity is the Bitcoin on YOUR side of the channel. It represents your ability to send payments.
✅ Outbound = Sending Power
- • Created when YOU fund a channel
- • Decreases when you send payments
- • Increases when you receive payments
- • You control this by opening channels
How to Get More Outbound Liquidity
- Open a channel and fund it with your Bitcoin
- Receive payments through existing channels
- Loop in using submarine swaps (on-chain → Lightning)
Inbound Liquidity (Receiving Capacity)
Inbound liquidity is the Bitcoin on your PEER'S side of the channel. It represents your ability to receive payments.
⚡ Inbound = Receiving Power
- • Created when SOMEONE ELSE opens a channel to you
- • Decreases when you receive payments
- • Increases when you send payments
- • Harder to get – requires others to commit capital
How to Get More Inbound Liquidity
- Request a channel from an LSP like LOM (easiest)
- Spend through existing channels to "make room"
- Loop out using submarine swaps (Lightning → on-chain)
- Ask peers to open channels to you (requires relationships)
Which Do You Need?
| Use Case | Need | Solution |
|---|---|---|
| Buying things / Paying invoices | Outbound | Open a channel to LOM (free) |
| Receiving payments / Getting paid | Inbound | Request inbound from LOM (25k sats) |
| Running a merchant node | Mostly inbound | Request inbound channels |
| Routing payments for others | Both | Balance of inbound + outbound |
| AI agent making API calls | Mostly outbound | Open channels, keep them funded |
The Liquidity Seesaw
Remember: total channel capacity stays constant. When you send, outbound decreases and inbound increases. When you receive, the opposite happens. It's like a seesaw:
After opening 1M sat channel:
[████████████████████░░░░░░░░░░░░░░░░░░░░]
Outbound: 1,000,000 Inbound: 0
After sending 400k:
[████████████░░░░░░░░░░░░████████░░░░░░░░]
Outbound: 600,000 Inbound: 400,000
After receiving 200k:
[████████████████░░░░░░░░████░░░░░░░░░░░░]
Outbound: 800,000 Inbound: 200,000
Pro Tips
- Plan ahead: Think about your typical payment flow before opening channels
- Multiple channels: Don't put all liquidity in one channel
- Monitor balance: Rebalance channels that get too one-sided
- Start small: Test with smaller channels before committing large amounts