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0 sats \ 5 replies \ @DarthCoin 27 Nov 2023 \ on: What's the best time to start using Phoenix Wallet? bitcoin
Is not about WHEN but about HOW...
For Phoenix I would suggest the following scenario:
Phoenix is opening a channel slightly bigger than what are you depositing, I could say with a 10% more. With the new version v0.2.0 that comes with the new LN feature splicing. That means from now on you will not have to deal anymore with lots of new small channels for each payment received.
If there’s not enough inbound liquidity, Phoenix will increase the size of your initial channel, but that will still imply an onchain fee. You can setup that fee anyways in Phoenix settings.
So I suggest to start using Phoenix with a big channel, like 1-3-5M sats. Your commit fees will be insignificant comparing with the size of the channel and will not affect you too much. Also instead of paying 4 times (or whatever many times you deposit small amounts) min 3000 sats fees, you will pay only once.
If you start spending from that channel, do not spend it all, because Phoenix will close it. If you leave some sats in the channel and make another refill from another LN wallet / source, with an amount bigger than you channel capacity, Phoenix will resize the channel and you will pay an extra fee. If you receive less than channel capacity, will be no fees involved.
So try to size your initial channel capacity to your personal needs for spending. Spend and replace in the limits of the channel will not occur anymore fees and the experience using this wallet app will be smooth.
For each payment you are doing, this wallet is using quite high fees, compared with other nodes. Yes, somehow they have to cover their expenses and support the dev team. Nothing is for free in this world.
This wallet also have integrated swaps onchain ←→ LN channels, so you could practically use it as a personal swap, you could pay instantly onchain with your LN funds and vice versa.
It is very good option for newbies, that just started with LN and don’t know too much about a node management, but still could have a self custody of their funds. Even if you lose your mobile device, you can use the seed words and recover your funds in an Electrum wallet or on another mobile device with Phoenix.
Read more about other private LN nodes here:
https://darthcoin.substack.com/p/private-lightning-nodes
And here a comparison guide about almost all LN wallets:
https://darthcoin.substack.com/p/lightning-wallets-comparison
Thanks for the exhaustive explanation and the related article. I read it and I still have doubts in this aspect:
"For each payment you are doing, this wallet is using quite high fees, compared with other nodes. Yes, somehow they have to cover their expenses and support the dev team"
Which payment? I don't get that clear enough.
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Which payment?
Normal payments you are doing with it.
Phoenix wallet have only a single LSP (liquidity service provider), that is their own Acing node. That means ALL your payments will go through that node only. And they charge fees for each payment you are doing.
If you are OK with that, go ahead, is a good app for starting.
Remember!
- This is NOT a holding wallet !
- This is just a LN wallet, for spending, day to day!
For holding, use an onchain wallet.
Please read this another detailed guide, to know how to do the 3 levels stash: hold, cache, spending
https://darthcoin.substack.com/p/bitcoin-be-your-own-bank-think-like
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Now I understand. Thanks. I'll have to keep learning what's the best way to store my sats since I've been earning them from the LN. They'll have to take a long route to be on the mainnet I guess 😅
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I just told you: read that guide how to think like a bank and organize your stash on levels.
It doesn't matter how you obtain those sats (onchain or LN). Important is to follow this simple 3 levels rule: hold, cache, spending
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Yeah I did read your guide. Still is a lot of info to process. Keep sure that I'll get to digest it completely, tho. Thanks again mate!
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