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name: lightning-loop-pool-lit description: | Lightning Labs liquidity tools: Loop (off-chain ↔ on-chain swaps), Pool (auction-based liquidity market), Lightning Terminal (Lit, web UI). Submarine swap mechanics behind Loop. As of September 2026 Loop is the live general-purpose option: Boltz swaps are offline (suspended 2026-08-03) and Peerswap rejects new L-BTC swaps (v7.0.1, 2026-09-07). USE WHEN: managing channel liquidity, evaluating Loop vs Boltz vs Peerswap, deploying Lit for fleet management. allowed-tools: Read, Grep, Glob

Lightning Loop / Pool / Terminal

Lightning Labs' suite of liquidity-management tools, built on top of LND.

Loop — submarine swaps

Loop lets you convert between on-chain and Lightning balance:

Loop Out (LN → on-chain)

Use case: drain channels, reduce Lightning balance into on-chain.

LND ──── HTLC payment ────► Loop server
                           Loop server publishes on-chain HTLC
LND watches chain, receives on-chain payout via preimage reveal.

Loop In (on-chain → LN)

Use case: inbound liquidity, rebalance.

LND publishes on-chain HTLC ────► Loop server
                                Loop server pays LND HTLC over LN
On-chain HTLC settled via preimage.

Loop = submarine swap. Atomic via shared preimage / HTLC scripts. Fees: ~0.5% typically.

loopd

loop in --amt 1000000 --htlc_conf_target 6
loop out --amt 5000000 --channel <chan-id>
loop monitor   # watch ongoing swaps

Pool — channel auction

Pool is a marketplace where:

• Makers (liquidity providers) commit liquidity for sale.
• Takers (channel-needers) bid for inbound.

Pool runs per-block batched auctions. Winning matches get a dual-funded channel.

poold

pool accounts new --amt 1000000   # deposit funds for bidding
pool orders submit ask --amt 500000 --duration 144 ...   # offer to provide
pool orders submit bid --amt 1000000 --duration 144 ...   # request liquidity

Lightning Terminal (Lit)

Web UI bundling LND + Loop + Pool + Faraday + Taproot Assets daemon

• Pool. Single web dashboard for node management.

litd  # runs LND + sub-services + UI on port 8443

Web UI features:

• Balance, channels, payments tracker.
• Loop interface (one-click in/out).
• Pool interface (submit orders, view auctions).
• Taproot Assets management.

Submarine swap protocol detail

Both Loop In and Loop Out use atomic swaps via HTLC:

Loop Out flow

1. User generates preimage P, hash H = SHA256(P).
2. User pays LN invoice with H to Loop server. HTLC route ends at Loop server with H.
3. Loop server's HTLC has not yet been fulfilled by user (no P revealed).
4. Loop server publishes on-chain HTLC at user's specified address, spendable by user with P, refundable by Loop server after CLTV.
5. User claims on-chain output, revealing P.
6. Loop server uses P to fulfill the LN HTLC, gets paid.

Atomic: either both swap legs settle or neither (both refund).

Alternatives

• Boltz — competing submarine swap service, also supports Liquid swaps. Offline since 2026-08-03 after AI-assisted attacks; non-custodial, so refunds stayed up. No relaunch date as of 2026-09-15 — protocol reference only, not a live API.
• Peerswap (CLN plugin, LND lncli plugin) — peer-to-peer swaps, no third-party trust. Bitcoin only as of 2026-09-15: v7.0.1 (2026-09-07) rejects new L-BTC swaps after a Liquid Network security incident; v7.0.0 (2026-08-19) fixed two Liquid issues under a withheld CVE. Bitcoin swaps unchanged.
• Splice-out (CLN, ldk) — built-in; no third-party.

Lightning Loop has the broadest impl support; Peerswap is more trust-minimized but requires both parties to support it, and as of September 2026 covers Bitcoin swaps only.

Common bugs

• Loop fails on swap due to mismatched fees: server's quote vs current mempool fee → use higher htlc_conf_target.
• Stuck swap: user's LN HTLC sent but server's on-chain HTLC delayed → wait for CLTV refund or resubmit.
• Lit web UI requires LND macaroon; misconfigured → Auth failures.

See also

• submarine-swaps/SKILL.md
• lnd/SKILL.md
• ../../l2/taproot-assets/SKILL.md