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Do we Need Bitcoin to be a Micropayments Network as well?

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Bitcoin’s designation in the financial space has flipped and flopped in its ten years of existence. It started out as an interesting cryptographic experiment, then moved on to being the currency of the dark web. 

However, in recent times, the coin has become much more like a gold bar. In fact, it has been labeled digital gold and likened to a very well-performing asset. Part of what has made it attractive to investors is its volatility; it has the ability to skyrocket in value overnight. 

This, however, is also the reason why it has deviated away from being a digital cash, something that was proposed in its white paper ten years ago. So, while we are still unsure of what Bitcoin should be – although Bitcoin Cash advocates will disagree, we still need to find a use for it. 

The reason Bitcoin became cemented as digital gold is because, in 2017, if you had bought one coin for the $1,000 they were going at in January, you would have walked away with $20,000 for that same coin on December 17, the same year. 

Since then, Bitcoin has not quite shown 2,000 percent price gains but remains a decent asset to invest in for a long period of time. For this year alone – even after a price fall, the coin is over 100 percent up Year to Date. 

That being said, Bitcoin believers still want to squeeze out some more utility for the original blockchain and feel there is a missed opportunity of people do not use it as a currency. The Lightning Network is one factor to consider when trying to make Bitcoin more usable for things like micropayments. 

The Lightning Network was heralded as the answer to making Bitcoin more usable as a currency when the network itself was heavily congested. When Bitcoin was near its peak, transactions could cost $30 and take most days. 

The answer was the lightning network that could allow a user to buy coffee and other small transactions with minute fees and almost no waiting time – it was the answer to tuning Bitcoin into a currency. 

However, even though the Lightning network is a good solution, and is expanding, it is still not taking into consideration one important aspect – no one wants to spend Bitcoin.

Regardless, Andreas Antonopoulos, a well known Bitcoin educator, has explained the advantages of the Lightning Network, especially for things like micropayments.

“Because of the capability of micropayments and having instant settlements of transactions, with high security and privacy on Lightning Network, you can build some interesting applications that you can’t do today with any Layer 1 blockchain. And certainly not with traditional financial services” he said

Of course, he makes a solid point, but the fact remains that if I had used the Lightning Network to buy a coffee on January 1 this year, and I did it again today – I am spending twice as much money. If I did that in 2017… it would be a whole lot more financially irresponsible. 

Darryn Pollock
Darryn has been interested in the blockchain and cryptocurrency space since he heard about Bitcoin in 2015. He then decided to use his journalism degree to report on this fascinating fintech space in 2016, and has not looked back since.

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