Unable to open lightning channel to Electrum from LND

[gone-to-the-future]

Description

I have a Bitcart installation which uses Electrum under the hood as a wallet. Gossip is enabled. The node should be accessible on testnet v3 03f48270818746aeffbb29dab5dc63993b0e4cda458ed5ef1f39e0a82043a36022@73.11.69.253:9735

I am able to successfully open a channel from another electrum wallet to this node, however, when trying to open a channel from an LND node, I get errors like:

[INF] FNDG: Cancelling funding reservation for node_key=03f48270818746aeffbb29dab5dc63993b0e4cda458ed5ef1f39e0a82043a36022,
[ERR] RPCS: unable to open channel to NodeKey(03f48270818746aeffbb29dab5dc63993b0e4cda458ed5ef1f39e0a82043a36022): unable to send funding request message: peer exiting
RPCS: unable to open channel to NodeKey(03f48270818746aeffbb29dab5dc63993b0e4cda458ed5ef1f39e0a82043a36022): user canceled funding
Unable to handle funding accept message for peer_key=03f48270818746aeffbb29dab5dc63993b0e4cda458ed5ef1f39e0a82043a36022, pending_chan_id=xx: aborting PSBT flow: user canceled funding

Background:

I am working to automate liquidity management in lightning for Bitcart. Bitcart is an OSS payment processing tool similar to BTCPayServer, which uses electrum wallet in the backend. To do this, I am trying to purchase liquidity from Zeus using their API see the docs for that below. I am able to use create_order but I'm unable to pay the invoice to buy the liquidity because Zeus is unable to open a channel to my electrum wallet.

https://docs.zeusln.app/lsp/services/lsps1

Electrum version: 4.6.0b1 - https://electrum.org - https://github.com/spesmilo/electrum
Python version: 3.12.11 (main, Aug 12 2025, 22:39:47) [GCC 14.2.0]. On platform: Linux-5.4.0-169-generic-x86_64-with

[f321x]

Just tried to reproduce with LND v0.19.1-beta and Electrum (master) on regtest and was able to open a channel from LND to Electrum without issues.
Before opening the channel i opened the transport from Electrum to LND using add_peer("nodeid@host:port").
On LND i ran lncli openchannel electrum_nodeid local_amt push_amt.
Did you disable use_recoverable_channels in Electrum? If use_recoverable_channels is enabled (the default) it will reject incoming channels. Also note you are still on Electrum v4.6.0b1 but v4.6.2 has already been released.

[MrNaif2018]

Question by the way, is recovering channels from seed for incoming channels not supported in lightning as a protocol, or it's something that may be added in the future to electrum? I think it's this being the issue, will add ability to disable recoverable channels and ask the user to re-test

[f321x]

The "recoverable channels" option in Electrum is independent of the lightning protocol.
When enabled, it adds an op return output to the channel funding transaction containing half of the remote node id (encrypted).
So when restoring from seed the wallet can detect the op return output, decrypt it, look for the node id in gossip, open a connection to the remote node and request a force close to recover the funds of the channel.
For incoming channels this doesn't work as the funding transaction doesn't touch the wallet of the channel fundee, when restoring from seed the wallet won't be able to find the funding transaction.

[MrNaif2018]

But would there be any issue if, during recovering from seed, all outgoing channels recovered successfully, but incoming channels got force closed? I don't see why it wouldn't be a good thing, at least part of the channels will be recovered, so not sure why does it disallow receiving incoming channels then. Maybe I am missing something

[f321x]

When restoring from seed the channels always have to be force closed to recover the funds. It is not possible to continue using the channel as the channel state (db) is lost when restoring from seed. The option use_recoverable_channels will only allow you to ask the remote node (channel peer) to force close the channel for you, as they hopefully still have the latest channel state. When recovering from seed the wallet couldn't request a force close for incoming channels as it doesn't even know they exist.
You can enable the option use_recoverable_channels when opening an outgoing channel, and then disable it again to be able to receive incoming channels. But then the user should do manual static channel backups for the incoming channels as he would otherwise risk losing the funds in the incoming channels (same as with other lightning implementations).

[gone-to-the-future]

@f321x Iuse_recoverable_channels is set correctly, and I've been able to open channels to this node from an outside electrum node, so that doesn't seem to be the issue. The problem only seems to be occurring w Zeus/LND.

Would you be able to try opening a channel from LND on testnet v3 to our node? I'll gladly send you some testnet coins. Our node is: 03f48270818746aeffbb29dab5dc63993b0e4cda458ed5ef1f39e0a82043a36022@73.11.69.253:9735

Just to double check it's not the version issue, I re-created this test with another wallet (electrum 4.6.2) and the behavior is the same.

[f321x]

@gone-to-the-future I tried again on signet (i don't have a synced testnet v3 node right now) and still cannot reproduce. I set up a fresh LND v0.19.3 node and could open channels to two different Electrum wallets without any issues.
However when i try to request a channel from olympus on mutinynet i receive this on my side:

396.97 | D | lnpeer.Peer.[LNWallet, 032ae843e4-448fa00e] | Received OPEN_CHANNEL
396.97 | I | lnpeer.Peer.[LNWallet, 032ae843e4-448fa00e] | upfront shutdown script received: b''
396.97 | D | lnpeer.Peer.[LNWallet, 032ae843e4-448fa00e] | Sending ACCEPT_CHANNEL
397.25 | D | lnpeer.Peer.[LNWallet, 032ae843e4-448fa00e] | Received ERROR
397.25 | I | lnpeer.Peer.[LNWallet, 032ae843e4-448fa00e] | remote peer sent error [DO NOT TRUST THIS MESSAGE]: 'funding failed due to internal error'. chan_id=06b0bb0a55c8d18614d26fc10d19025a7f61bb28290a4cdc4f00293a0f77ab11. is_known_chan_id=True
397.25 | I | lnpeer.Peer.[LNWallet, 032ae843e4-448fa00e] | Disconnecting: GracefulDisconnect()

Maybe this is an issue with an older LND version. Which LND version have you been testing with? Did you modify the default configuration of your LND testing instance?

[kaloudis]

Sharing pertinent logs from the Mutinynet Olympus node:

2025-10-23 15:10:32.523 [INF] FNDG: Target commit tx sat/kw for pendingID(06b0bb0a55c8d18614d26fc10d19025a7f61bb28290a4cdc4f00293a0f77ab11): 253
2025-10-23 15:10:32.523 [INF] FNDG: Dust limit for pendingID(06b0bb0a55c8d18614d26fc10d19025a7f61bb28290a4cdc4f00293a0f77ab11): 0.00000354 BTC
2025-10-23 15:10:32.525 [INF] FNDG: Starting funding workflow with 149.88.24.150:1435 for pending_id(06b0bb0a55c8d18614d26fc10d19025a7f61bb28290a4cdc4f00293a0f77ab11), committype=anchors-zero-fee-second-level
2025-10-23 15:10:32.869 [INF] FNDG: Recv'd fundingResponse for pending_id(06b0bb0a55c8d18614d26fc10d19025a7f61bb28290a4cdc4f00293a0f77ab11)
2025-10-23 15:10:32.870 [INF] FNDG: pendingChan(06b0bb0a55c8d18614d26fc10d19025a7f61bb28290a4cdc4f00293a0f77ab11): remote party proposes num_confs=3, csv_delay=1008
2025-10-23 15:10:32.879 [INF] FNDG: Cancelling funding reservation for node_key=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, chan_id=06b0bb0a55c8d18614d26fc10d19025a7f61bb28290a4cdc4f00293a0f77ab11
root@localhost:~/.lnd/logs/bitcoin/signet# cat lnd.log.1220 | grep 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41
2025-10-23 14:39:20.536 [INF] SRVR: Finalizing connection to 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41@149.88.24.150:38747, inbound=true
2025-10-23 14:39:20.650 [INF] PEER: Peer(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): Loading ChannelPoint(1fae43e9387c9e35767f0be23602e8f198e5d3c8e0987113ba04ee470987e9e2:2), isPending=false
2025-10-23 14:39:41.968 [INF] PEER: Peer(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): unable to read message from peer: read next header: EOF
2025-10-23 14:39:41.968 [INF] PEER: Peer(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): disconnecting 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41@149.88.24.150:38747, reason: read handler closed
2025-10-23 15:03:57.534 [INF] SRVR: Finalizing connection to 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41@149.88.24.150:1435, inbound=true
2025-10-23 15:03:57.646 [INF] PEER: Peer(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): Loading ChannelPoint(1fae43e9387c9e35767f0be23602e8f198e5d3c8e0987113ba04ee470987e9e2:2), isPending=false
2025-10-23 15:04:27.369 [INF] PEER: Peer(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): Delivery addr for channel close: tb1p54d4vq5nk2rkwec4s83y46p0ssqvuyra5v0uj8xulnc8r55jrxaqncmlwg
2025-10-23 15:05:00.173 [INF] GRDB: Pruned unconnected node 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41 from channel graph
2025-10-23 15:05:00.236 [INF] CHDB: Pruning link node 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41 with zero open channels from database
2025-10-23 15:10:05.876 [WRN] RPCS: Gossip syncer for peer=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41 not found
2025-10-23 15:10:32.460 [INF] FNDG: Initiating fundingRequest(local_amt=0.10000000 BTC (subtract_fees=false), push_amt=0 mSAT, chain_hash=00000008819873e925422c1ff0f99f7cc9bbb232af63a077a480a3633bee1ef6, peer=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, min_confs=1)
2025-10-23 15:10:32.878 [ERR] FNDG: Unable to handle funding accept message for peer_key=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, pending_chan_id=30366230626230613535633864313836313464323666633130643139303235613766363162623238323930613463646334663030323933613066373761623131: aborting PSBT flow: user canceled funding
2025-10-23 15:10:32.879 [INF] FNDG: Cancelling funding reservation for node_key=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, chan_id=06b0bb0a55c8d18614d26fc10d19025a7f61bb28290a4cdc4f00293a0f77ab11
2025-10-23 15:10:32.879 [ERR] RPCS: unable to open channel to NodeKey(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): user canceled funding
2025-10-23 15:10:32.896 [INF] FNDG: Initiating fundingRequest(local_amt=0.10000000 BTC (subtract_fees=false), push_amt=0 mSAT, chain_hash=00000008819873e925422c1ff0f99f7cc9bbb232af63a077a480a3633bee1ef6, peer=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, min_confs=1)
2025-10-23 15:10:33.070 [INF] PEER: Peer(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): unable to read message from peer: read next header: EOF
2025-10-23 15:10:33.070 [INF] PEER: Peer(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): disconnecting 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41@149.88.24.150:1435, reason: read handler closed
2025-10-23 15:10:33.176 [ERR] RPCS: unable to open channel to NodeKey(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): peer disconnected
2025-10-23 15:16:46.541 [INF] SRVR: Finalizing connection to 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41@149.88.24.150:63995, inbound=true
2025-10-23 15:16:46.542 [INF] SRVR: Pruned peer 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41 from persistent connections, peer has no open channels
2025-10-23 15:16:49.528 [WRN] RPCS: Gossip syncer for peer=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41 not found
2025-10-23 15:17:13.713 [INF] FNDG: Initiating fundingRequest(local_amt=0.10000000 BTC (subtract_fees=false), push_amt=0 mSAT, chain_hash=00000008819873e925422c1ff0f99f7cc9bbb232af63a077a480a3633bee1ef6, peer=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, min_confs=1)
2025-10-23 15:17:13.936 [ERR] FNDG: Unable to handle funding accept message for peer_key=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, pending_chan_id=30623834366639666134616134363761363331616539383662666264616165636439366535366136316434646366323166323934663163633230343437646565: aborting PSBT flow: user canceled funding
2025-10-23 15:17:13.936 [INF] FNDG: Cancelling funding reservation for node_key=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, chan_id=0b846f9fa4aa467a631ae986bfbdaaecd96e56a61d4dcf21f294f1cc20447dee
2025-10-23 15:17:13.936 [ERR] RPCS: unable to open channel to NodeKey(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): user canceled funding
2025-10-23 15:17:13.943 [INF] FNDG: Initiating fundingRequest(local_amt=0.10000000 BTC (subtract_fees=false), push_amt=0 mSAT, chain_hash=00000008819873e925422c1ff0f99f7cc9bbb232af63a077a480a3633bee1ef6, peer=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, min_confs=1)
2025-10-23 15:17:14.131 [INF] PEER: Peer(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): unable to read message from peer: read next header: EOF
2025-10-23 15:17:14.131 [INF] PEER: Peer(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): disconnecting 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41@149.88.24.150:63995, reason: read handler closed
2025-10-23 15:17:14.233 [ERR] RPCS: unable to open channel to NodeKey(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): peer disconnected
2025-10-23 15:19:44.536 [INF] SRVR: Finalizing connection to 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41@149.88.24.150:18244, inbound=true
2025-10-23 15:19:47.701 [WRN] RPCS: Gossip syncer for peer=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41 not found
2025-10-23 15:20:28.866 [INF] FNDG: Initiating fundingRequest(local_amt=0.10000000 BTC (subtract_fees=false), push_amt=0 mSAT, chain_hash=00000008819873e925422c1ff0f99f7cc9bbb232af63a077a480a3633bee1ef6, peer=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, min_confs=1)
2025-10-23 15:20:29.147 [ERR] FNDG: Unable to handle funding accept message for peer_key=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, pending_chan_id=31393366386466306537613764626261343837613461303365363764363431343531373630626264396634313861333964633831636566333836626638363138: aborting PSBT flow: user canceled funding
2025-10-23 15:20:29.147 [INF] FNDG: Cancelling funding reservation for node_key=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, chan_id=193f8df0e7a7dbba487a4a03e67d641451760bbd9f418a39dc81cef386bf8618
2025-10-23 15:20:29.147 [ERR] RPCS: unable to open channel to NodeKey(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): user canceled funding
2025-10-23 15:20:29.152 [INF] FNDG: Initiating fundingRequest(local_amt=0.10000000 BTC (subtract_fees=false), push_amt=0 mSAT, chain_hash=00000008819873e925422c1ff0f99f7cc9bbb232af63a077a480a3633bee1ef6, peer=02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41, min_confs=1)
2025-10-23 15:20:29.363 [INF] PEER: Peer(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): unable to read message from peer: read next header: EOF
2025-10-23 15:20:29.363 [INF] PEER: Peer(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): disconnecting 02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41@149.88.24.150:18244, reason: read handler closed
2025-10-23 15:20:29.465 [ERR] RPCS: unable to open channel to NodeKey(02d79f163b67ade1567086e79061f93bd80bb39b4dfe6dfd992a1cd3a2f9aa0c41): peer disconnected

[gone-to-the-future]

I have confirmed this problem exists not just with Zeus but also with @megalithic (on mutinynet). Steps I took to recreate:

1. On machine1, start electrum wallet w --mutinynet. Disable trampoline routing. Open channel to another random node. works.
2. On machine2 (hosted in external data center), start electrum wallet w --mutinynet, disable trampoline routing, give it some coins
3. On machine2, open lightning channel to machine1. Works.
4. Run create_order via megalithic API, attempt to pay invoice from machine1, fails. Error: Hops 2 channel id destination node, message INCORRECT_OR_UNKNOWN_PAYMENT_DETAILS

Megalithic API specs:
https://docs.megalithic.me/lightning-services/lsp1-get-inbound-liquidity-for-mobile-clients/

[f321x]

@gone-to-the-future, so i tried to reproduce again:

1. Connecting to your testnet3 electrum node (03f48270818746aeffbb29dab5dc63993b0e4cda458ed5ef1f39e0a82043a36022@73.11.69.253:9735) did not work, i couldn't open the connection, it seems down or not exposed anymore.
2. Megalithic: I was able to purchase a mutinynet channel from megalithic to me. I disabled recoverable channels, added megalithic as peer and then gave them my (Electrum) nodeid and purchased a private channel on the web interface, no issues at all.
3. Testnet3 LND -> Electrum, worked perfectly fine too. No issues at all.
4. Olympus, still the same issue as before, fails on testnet3 and mutinynet

Run create_order via megalithic API, attempt to pay invoice from machine1, fails. Error: Hops 2 channel id destination node, message INCORRECT_OR_UNKNOWN_PAYMENT_DETAILS

The INCORRECT_OR_UNKNOWN_PAYMENT_DETAILS just means they failed your lightning htlcs to refund the payment as their node failed to open the channel to you, however it is weird that Megalithic fails for you but worked fine for me.

Which LND version were you running when producing the logs in your first message here? Are you running some older version?
I am still testing with lnd v0.19.3-beta.

@kaloudis thanks for the logs. Can you provide the LND version you are running?

[MegalithicBTC]

Happy to help with this. As part of the LSPS1 process, we do multiple checks to confirm that your node is connected to our node before we "resolve" the hold invoice.

I see some activity from our MutinyNet node.

I can see that 6 days ago, the node starting with 0356668fe913080 attempted to open some channels, but we didn't even produce an invoice, which usually means this node wasn't connected to the LSP.

Then, about 13 hours ago, I see another attempt from 0356668fe913080... in this case you were connected at first, so we did produce an invoice lntbs131260n1p5szkf3pp5v2d92us...... it looks like you did pay this invoice, BUT... then right before we attempted to open the channel, we saw that your node was no longer connected to ours... when that happens, we "fail" the hold invoice.

So far it looks like simple connectivity issues. Sometimes these can be easiest to diagnose when both of us are online and can run some tests. Feel free to get us on Signal or Telegram if you want to try this: https://megalithic.me/contact