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Lightning Network - Perhaps the Last Chance

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Written by   41
3 months ago

We keep reading about the Lightning Network for many years now. It has been so long the development is taking place that most people have already stopped discussing it, or reading about LN. The layer-2 solution is still being tested and not to be used by anyone that does not possess vast programming skills and knowledge of the Bitcoin network.

LN was the solution proposed since 2015 to allow Bitcoin to scale and it is being developed ever since. Currently Bitcoin is not able to become a worldwide currency. The narrative has changed after the failure of 2017 where transactions stuck in the mempool for days and fees reached astronomical prices.

The concept of LN is a network running outside of the Bitcoin's blockchain, where transactions are performed off-chain and both sender and receiver have to sign the transcaction using their private keys. The transactions are later added on the blockchain.

Source: Investopedia

There have been many articles and reports written so far about the centralization of the LN network and various problems that might surface. The latest theoretical vulnerability that was reported for the LN is the possibility of a "flood and loot" attack. This article by coinbase covers the basics of this concept.

My intention with this article is not to explain the Lightning Network or the developments but move to an important part of a possible mass adoption. Bitcoin is still the number one cryptocurrency and has diehard fans. Most of them right now understand that Bitcoin cannot become a currency with the current structure and are mostly interested in price speculation and shilling their bags on twitter while hoping that someday soon it will reach 100K USD.

Once again it is obvious that no one is going to buy Bitcoin with the narrative that it is digital gold for one reason. Gold is old news. Its price is not reflecting any use case now. It has been used for three thousand years just for showing off. Since technology evolves, gold fades and becomes just a memory of how societies were built according to the shinny feature of a useless element. Gold kept its value during history as it was used to back national currencies. It added value to the currencies but the currencies were also appreciating the value of gold, providing it the only use case it could ever have.

With the digital evolution of economics, gold is no longer needed. It has no purpose. Of course, if all traders and investors think it is a safe harbor, it will be one. Still, it seems that government bonds are more desired for this reason, and serve a better purpose than gold.

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Somehow there was a perception that Bitcoin is not for the masses anymore but the focus should be on hedge funds and institutional investors. I've seen many such opinions forming out of nowhere and not getting the proper answer. One guy literally said a few months ago: "Bitcoin is not for everyone", meaning that it is an asset just for the 1% as this person explained later. Made me think that I wouldn't want any part of it if this is the case.

Anyway, it is obvious that Bitcoin is not touching the masses. The reason has to do with Bitcoin not being a currency and not even focusing on this feature anymore. While Bitcoin is run by consensus, I fail to understand how all participants think that Bitcoin will reach $100,000 without any real development or adoption.

With the Lightning Network Bitcoin will have a chance to be used in vending machines, in Starbucks and in McDonalds. People will use Bitcoin if it is easy to use. If it saves time and fees. If it doesn't proceed but take another 10 years to be developed then the only use-case will just be price speculation which will only lead to lower price, according to its lower usecase.

Bitcoin was supposed to be a P2P digital cash network and a digital store of value. Taking away the feature of being a currency will only create problems for the store-of-value feature as well. These two attributes must co-exist, as canceling one will effectively cancel the other. A last chance to succeed is presented. If Bitcoin fails to scale again, there will be other coins ready to cover this gap.

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Reposted on Uptrennd and Publish0x

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Written by   41
3 months ago
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Comments

Yes, this is the case. Scaling, is needed, for everyday transactions. I think that Bitcoin always will have it's value, as a legacy coin, like antique cars.

$ 0.00
3 months ago

I also don't consider gold as an investment. I consider it as an insurance in case the government flops.

$ 0.00
3 months ago

Bitcoin BTC has long since ceased to be a p2p electronic cash. The transaction fees are too high. It is a pure speculative object. LN is too complicated and does not work properly. The average user is completely overwhelmed with it. I have dropped BTC. Here you can read why:

https://read.cash/@Telesfor/why-i-dont-use-btc-98073d18

Fortunately there is a Bitcoin which works as p2p electronic cash. It is Bitcoin Cash BCH

Do you know the interview with Marc De Mesel? https://read.cash/@ralak/interview-of-marc-de-mesel-the-magnanimous-98201816

$ 0.10
3 months ago

My point was this. Other coins will eventually take over since Bitcoin is lagging in development. LN seems to be years behind and there will be centralization issues and perhaps issues with accounts. You can read my first post on read.cash as well. This post was about LN though.

$ 0.00
3 months ago

Thank you for pointing that out. I read your first article. I am very disappointed with BTC and Core developers. They deliberately crippled BTC to introduce LN. From my point of view they want to make money with it in the medium term. They don't want anything good for Bitcoin. LN is no longer Bitcoin for me. It's like a token that I have to exchange 1:1 to Bitcoin in order to use it. For 1 BTC I get 1 LN token, which I can only use in the Lightning Network. And LN-Token I can not use in the blockchain.

$ 0.00
3 months ago