Glossary / Lightning & layer 2
Channel reserve
- What is Channel reserve?
- Channel reserve is the slice of a Lightning channel balance each side is forbidden to spend, held as collateral so cheating with an old commitment transaction always costs something.
Both peers name a reserve for each other when the channel opens, and neither may drain past it for as long as the channel lives. BOLT 2 suggests 1 percent of the channel total and requires the reserve to be at least the dust limit, which cannot go below 354 satoshis. A wallet showing 100,000 satoshis will let you spend slightly less, and the gap is not a bug.
How it works
Channel reserve is set by your peer rather than by you: the channel_reserve_satoshis field a node sends is the minimum the node at the other end has to keep as a direct payment.
The field is a 64 bit number in open_channel, message type 32, and again in accept_channel, type 33, so a channel opened this way carries two reserves, which need not match. The specification's rationale gives the purpose: each side maintains its reserve "so it always has something to lose if it were to try to broadcast an old, revoked commitment transaction". Remove it and the loser of a channel dispute risks nothing by publishing a stale balance and hoping nobody watches.
Two checks keep the number sane. A reserve must be at least as large as the relevant dust limit, and the channel is failed outright if the dust limit is the bigger of the two, because a reserve that can be pruned as dust protects nothing; the channel is failed too if both opening balances sit at or below the reserve, leaving nothing spendable. One exemption exists because only the funder holds money at the start: a new channel need not meet both reserves at once, and the protocol settles for progress toward them.
Dual funded channels drop the field. In channel establishment v2, open_channel2 and accept_channel2 omit channel_reserve_satoshis, and the reserve is fixed at 1 percent of the two funding contributions added together, rounded down to a whole satoshi, or the dust limit if that is larger. Splicing follows the same principle: take money out of a live channel and what remains on your side has to clear the reserve for the new capacity. Whoever pays the on-chain fees carries one deduction more, since unless zero fee commitments have been negotiated the funder covers the commitment fee above its reserve, plus a recommended buffer for twice that fee rate.
Where you see it
Channel reserve is the usual reason a Lightning wallet's spendable figure sits below its balance.
On a large balance the gap is invisible, on a small one it is not. A 1 percent reserve on a 200,000 satoshi channel is 2,000 satoshis, so a wallet holding 2,300 satoshis there can send 300 and refuses anything larger, with a routing error, not an explanation. The same floor sits inside every stranger's channel your payment crosses, which is part of why routes fail near a channel's ends. Node operators meet it as the balance that never moves: open a 1,000,000 satoshi channel, push through it everything you can, and the last 10,000 satoshis stay put until the channel closes.
The part worth remembering: this money is still yours. It comes back on close, cooperative or forced, minus the closing fee. Set that against what a self-custodial Lightning wallet charges to make room for you: our Phoenix review records 1,000 satoshis to create a channel, and that is gone once paid. A reserve is locked capital.
Channel reserve vs dust limit
Channel reserve and dust limit are floors under an amount, from different layers. The dust limit is bitcoin relay policy about outputs: below it an output costs more to spend than it holds, so nodes decline to forward the transaction creating it. The reserve is a rule about channel balances, written into the Lightning specification to make cheating expensive, and it binds two peers only. BOLT 2 links them in one direction, requiring a reserve to be at least the dust limit so the output paying it out stays relayable; nothing pushes the dust limit up toward the reserve.