LND Routing Fee Strategies----Optimize Base and Rate Fees

Understanding LND Fees

LND uses two fee parameters per channel: base_fee (flat fee per HTLC, in millisatoshis) and fee_rate (proportional fee in parts per million).

# Total fee = base_fee + (amount * fee_rate / 1,000,000)

Check Current Fee Policy

lncli feereport
lncli getchaninfo <channel_id>

Update Fees for All Channels

lncli updatechanpolicy \
  --base_fee_msat 1000 \
  --fee_rate 0.000001 \
  --time_lock_delta 40

Update Fees for One Channel

lncli updatechanpolicy \
  --base_fee_msat 500 \
  --fee_rate 0.0000005 \
  --time_lock_delta 40 \
  --chan_point <funding_txid>:<output_index>

Fee Strategy by Channel Type

Inbound-heavy (sink) channels: raise fees to slow routing in. Outbound-heavy (source) channels: lower fees to attract routing. Balanced channels: keep fees at market rate (~1 ppm).

Common Mistakes

- base_fee too high: small payments get priced out

- fee_rate too low: you route for free (or at a loss)

- Never updating fees: channels become inefficient over time

Automate with charge-lnd

# charge-lnd applies rules based on channel balance
pip install charge-lnd
charge-lnd -c charge.conf