High-Throughput Micropayment Framework for Subscription-Based Services Using Layer-2 Blockchain Models

Abstract

Micropayment processing has emerged as a critical requirement for next-generation subscription-based digital services such as video streaming, cloud gaming, software-as-a-service (SaaS), and IoT-driven utilities. However, conventional on-chain blockchain transactions remain constrained by scalability bottlenecks, high confirmation latency, and disproportionate transaction fees that make frequent low-value payments impractical. This paper proposes a high-throughput Layer-2 blockchain framework designed specifically for subscription-oriented micropayment ecosystems. The architecture integrates bidirectional state channels, hashed timelock contracts (HTLCs), and lightweight off-chain settlement mechanisms to enable real-time credit deduction, granular pay-per-use billing, and cost-efficient microtransactions. A modular payment orchestration layer coordinates channel initialization, usage metering, session reconciliation, and dispute resolution, ensuring transparent and verifiable billing without congesting the underlying blockchain. Network simulation using an event-driven test environment demonstrates nearly a 10× improvement in throughput and a 7× reduction in transaction costs when compared to traditional on-chain models. The results confirm the potential of Layer-2 approaches in scaling high-frequency micropayments for commercial services including digital media subscriptions, IoT data access, decentralized applications (dApps), and pay-as-you-go infrastructure. The proposed framework offers a practical pathway toward sustainable, secure, and economically viable micropayment solutions suitable for widespread deployment in future blockchain-driven service ecosystems.