Users of Bitcoin realize that micro purchases and scaling are weaknesses of Bitcoin. The lightning network is a transaction system lying above the Bitcoin blockchain that seeks to overcome this weakness. Bitcoin can only handle 7 transactions per second, while Visa can handle a whopping 24,000 transactions per second.
Anexample of how the Lightning Network overcomes Bitcoin’s weakness of micro purchases is seen in the Bitfury coffee machine where users can buy coffee utilizing the network:
When you can buy something as small as a cup of coffee using Bitcoin, which is associated with high fees and long transaction times, you can see how the Lightning Network is a game changer. In essence the lightning network is an instant channel or conduit between 2 parties that remains open until a transaction is closed and sits above the blockchain to overcome the scaling issue. Once business has been concluded, only the total exchange is encoded on the blockchain as a record.
The biggest pro of the Lightning Network is outlined in the article below:
The Lightning network is fully P2P, with a buyer and seller interacting together without a node or “middle man” to mediate. The Lightning network is like an open conduit where information flows between two parties and is recorded on the public ledger when business is completed. This is an amazing functionality of cryptocurrencies and further enables decentralization.
An exciting development in cryptocurrency wallets and exchanges is the adoption of the Lightning Network in wallets and exchanges:
Proof of Stake (POS) and Proof of Work (POW) allow for centralization of resources, which the Lightning Network allows for the continued decentralization of the cryptocurrency functionality. Since the Lightning Network is a conduit system above the Bitcoin blockchain, any other cryptocurrency from DOGE to ETH could utilize it, further democratizing the cryptocurrency universe.
What do you think about the use of the Lightning Network? Should coins be made to have an internal functionality that is more decentralized?
Published in my Trybe account I own: