A second-layer protocol that is designed to solve Bitcoin’s scalability problem by allowing transactions to be processed more quickly.
Transactions are normally conducted on the blockchain, but Lightning involves taking transactions off-chain.
The Lightning Network is effectively a second layer for Bitcoin’s blockchain — creating payment channels to facilitate transactions.
Transactions are much faster as parties can transact with each other without everything having to be approved by nodes.
By contrast, the standard blockchain ledger does require approval from nodes in the blockchain, each of whom determines the authenticity of the transactions.
There are costs associated with using the Lightning Network, and critics claim that this scaling solution is also prone to hacks. They are also required to constantly be online, something which can prove to be a challenge.