In the Lightning Network, only the opening and closing of a channel are recorded on-chain. Once a channel is open, payments are executed off-chain by updating the channel balance between participants. These balance updates are cryptographically signed and do not require miner confirmations. Ensuring instantaneity without generating network congestion.
Because individual transactions are not broadcast to the blockchain, this model significantly reduces latency and avoids on-chain fees. Payments can be sent either directly between two connected nodes or indirectly via routed paths across multiple nodes, as long as sufficient liquidity is available.
Off-chain processing enables Lightning to deliver high speed, low cost, and scalability while still relying on the Bitcoin blockchain for security and final settlement when needed.