I was talking more about on-chain, limited block space, if higher tx demand = higher fees. Off-chain, limited capital available, therefore limited payment channels, if higher tx demand = higher fees.
I can't decide if this makes sense or if its just me, could you rephrase it?
There isn't a limited number of channels. When you open a channel you make a literal contract between you and the other nodes. If a node ups it's fees you'd just use a different node... Iff a payment processor or merchant charges too much for fees you'd just turn to a different one imo or complain to them and see if they'll reduce it (if your channel is open with them).
This is obviously different when using a custodial wallet but you don't have to use a custodial wallet and I'd the fees become too high then competition will likely increase...