Lighter Faces Major Outage Shortly After Launch
Lighter, an Ethereum Layer-2 platform for low-cost perpetual trading, experienced its first major outage last week. The platform went offline for nearly five hours, just 10 days after its public mainnet launch on October 1. The outage occurred during a highly volatile trading session, preventing many users from managing their positions.
The downtime lasted from 10:30 PM EST on October 10 to 3 AM EST on October 11. Lighter’s team reported the cause as an unprecedented load on their database inside the sequencer. The sequencer processes every order, deposit, withdrawal, and cancellation on the network.
During the outage, trading activity surged to 10 times the average throughput, with some blocks reaching 100 times higher. The cloud-hosted hardware could not handle the load, causing the database to fail and the network to halt.
Delayed Upgrade Led to System Failure
Before the mainnet launch, Lighter’s engineers identified the database as a weak point. An upgrade was planned but postponed multiple times to avoid downtime. The team now admits this delay was a mistake.
The database reached its limits during the market volatility. It survived the peak trading hour but failed several hours later. The team said, “By trying to solve for the perfect time to upgrade, we missed doing so before the period of extreme market volatility.”
Upgrading during normal operation would have taken 10–15 minutes. However, once instability began, recovery time became unpredictable.
Recovery and Compensation Plans
Engineers chose not to upgrade immediately during the outage. Instead, they worked overnight to restore the existing database. Lighter resumed operations at 3 AM EST on October 11, including pricing and risk systems.
Before reopening, the team checked for false orders or liquidations. Customer support remained active on Discord, Telegram, and X to assist users locked out of their positions. Market conditions had calmed, reducing potential damage.
Lighter confirmed plans to compensate affected traders. The data science team is analyzing records to identify losses during the outage.
- 2,008 traders lost over $1,000
- 367 traders lost more than $10,000
- 38 traders lost over $100,000
- 30 traders paid liquidation fees above $1,000
Compensation will include stablecoins and platform points. Distribution starts Monday. A smaller fund will cover users affected by an unrelated LLP drop, with details to follow.
Upcoming Infrastructure Upgrade
Lighter has scheduled the delayed infrastructure upgrade for 7 AM EST. The downtime is expected to last 10–15 minutes. The team emphasized the importance of prioritizing system stability over timing.
“This will be an important lesson for the engineering team to not let ‘the perfect be the enemy of the good,’” the team said in a post-mortem report.
Challenges of Scaling on Ethereum Layer-2
The outage highlights the challenges fast-growing Layer-2 platforms face balancing performance, cost, and reliability. Lighter uses custom zero-knowledge circuits for verifiable matching and liquidation. It aims to be a next-generation solution for perpetual trading.
Last week’s incident showed how scaling assumptions can fail under real market pressure. For a platform focused on speed and low costs, the outage was a reminder that reliability must be a priority.
As trading normalizes, the key lesson is clear: scaling requires preparation before demand spikes occur.
