Lightning Network Already a ‘Sleeping Giant’ For Non-Speculative Use Cases
Lightning Network developers are quick to tell people the second-layer scaling solution isn’t production-ready technology. That reality hasn’t stopped people and businesses from dipping their toes in Lightning’s water regardless.
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Lightning Already Firing Off for the Bold
There’s been a lot of buzz about the massive growth of Lightning Network participation since its launch a little over a year ago.
Yet the freshness of the protocol combined with some limitations inherent to Lightning’s design makes it difficult to gauge exactly how many people are presently using it for practical applications.
Bitsonline reached out to several organizations that have implemented Lightning for e-commerce, and Bitrefill, a service that allows you to use cryptocurrencies for traditionally fiat-only exchanges like bill payments and gift cards, graciously replied with some very interesting data.
Bitcoin still dwarfs other cryptocurrencies when it comes to non-speculative use according to Bitrefill’s year over year data, with BTC driving 80 percent of all transactions the company currently processes.
Litecoin is a distant second at 4.5 percent, and ether, dash, and dogecoin all come in between 2.2 and 2.4 percent respectively while the other 9 percent is divided between many other, less-used crypto payment options.
BTC payments via Lighting only made up 1.4 percent of Bitrefill’s early totals on the year, putting it behind mainstream altcoins. However, in recent months that figure has jumped up to levels comparable to other payment methods and seems to be trending consistently upward.
In fact, recent data puts Lightning Network transactions at the same volume as all Ethereum transactions Bitrefill receives year over year.
The implications of this are clear: altcoins have always struggled to find a niche for practical use cases, as they have been relegated almost entirely to speculative trading.
If Lightning has already reduced the friction involved with bitcoin payments to a degree that people are using it just as often as altcoins, the thin margin in the practical market will likely become even thinner.
This dynamic becomes more interesting when you consider that requirements to run a Lightning node don’t seem demanding at all compared to implementing altcoin payments, though the realities of production systems don’t always align with the theoretical.
Can Lightning Become King?
John Carvalho of Bitrefill had this to say about Bitrefill’s experience with Lightning payments:
“We use stock LND, with some basic iptables rules, increasing file descriptor minimum, and a basic interface to it. It’s a lot easier to run it now than Ethereum running Parity […] We believe LN is a sleeping giant for Bitcoin commerce, and we intend to be part of the infrastructure that allows that.”
Relatedly, some mainstream vendors have even dropped cryptocurrency payments entirely over the past two years, usually citing user friction as a major reason why.
From the perspective of e-commerce businesses, a lower impact network that invites a larger user base and reduces payments friction over pretty much every traditional cryptocurrency may be the key to reversing that particular trend.
Of course, only time will tell for now.
What’s your take? Will the Lightning Network have made major advancements in 10 years’ time? Let us know in the comments section below.
Images via Pixabay