LND Channel Rebalancing Strategies -- Keep Routing Profitable

Why Rebalancing Matters

Channels become unbalanced over time — all local (cannot receive) or all remote (cannot send). Rebalancing moves funds to restore bidirectional liquidity.

Option 1: Circular Rebalance with bos

bos rebalance --amount 500000 --out <channel_id> --in <channel_id>

This sends a payment that exits one channel and re-enters via another, rebalancing both.

Option 2: lncli (manual loop)

# Find a circular route manually
lncli queryroutes --dest <your_pubkey> --amt 500000
lncli sendtoroute --payment_hash <hash> --routes <route_json>

Option 3: Loop Out (on-chain swap)

loop out --amt 1000000 --channel <channel_id>

Moves funds from a channel to your on-chain wallet, draining the local side to create remote capacity.

Option 4: Lightning Pool / Sidecar

Buy inbound liquidity from the marketplace. Useful if you consistently lack incoming capacity.

When to Rebalance

- Local balance > 90%: hard to receive payments

- Remote balance > 90%: hard to send or route

- Routing revenue dropping unexpectedly

Cost Consideration

Circular rebalancing costs routing fees. Only rebalance if the expected routing revenue exceeds the rebalancing cost. Track with bos accounting or Thunderhub.