Cryptocurrency crash: Bitcoin’s ambition and potential have not changed, and here’s why

The Bitcoin 2022 conference gathered over 25,000 attendees in Miami last month to discuss the future of the largest cryptoworld currency. The event, which participants called “extravagant” and compared to a bacchanalia, was marked by Peter Thiel’s infamous speech in which the venture capitalist gathered bitcoin supporters against a list of people he described as the haters of bitcoin, including Warren Buffet and Jamie Dimon.

While Mr. Thiel’s speech garnered the brunt of the attention surrounding the conference, many investors, developers, and founders of the Bitcoin community gathered at the same event to discuss a threat that might arise. far more urgent than the aforementioned personae non gratae: competition.

Although the overall cryptocurrency market declined this week, bitcoin remains the most valuable cryptocurrency in the world with a market value of around $ 589 billion per year. May 9. Its status stems in part from the benefit of having been the first cryptocurrency token on a public blockchain.

But as new blockchains continue to emerge, and after last year’s “DeFi” summer that brought new momentum to Ethereum, bitcoin investors have had to start taking care of them. Today, blockchain supporters are investing capital to ensure that it can maintain its dominance as a form of money and expand to other use cases through decentralized applications (dApps) to stay in the race against competitors like Ethereum and Solana.

The payment advantage of Bitcoin

Bitcoin’s advantage has generally been described as its value as an asset to hedge against inflation, like gold, due to its fixed supply. On the same topic: Coinbase informs some Russian users that their accounts may be blocked.. Bitcoin supporters including Thiel, ARK Invest’s Cathie Wood and MicroStrategy’s Michael Saylor all spoke at Bitcoin 2022 about its ability to serve as a store of value when central banks loosen policy and let inflation run wild. , as has been the case in the United States for most of the COVID-19 pandemic.

The reality has not been so simple as bitcoin has often traded lower in times of rising inflation in the US. But bitcoin supporters say its value is most visible in developing countries, especially those who experience hyperinflation or have a large proportion of people without a bank. They see it as a relatively secure asset that can enable faster and more efficient payments, both within and across borders.

The Bitcoin network itself only supports about five transactions per second, according to stock Exchange of Binance cryptocurrencies. Bitcoin has integrated a layer two protocol called the Lightning Network to increase its speed and efficiency while reducing transaction costs, a piece of infrastructure used by the nation of El Salvador, and large crypto exchanges like the Kraken.

Lightning Labs startup, which raised a $ 70 million Series B round last month, is at the forefront of the development of the Bitcoin Lightning Network. It’s building infrastructure for the Bitcoin Lightning Network, similar to Visa’s payment network, Elizabeth Stark, CEO and co-founder of Lightning Labs, told TechCrunch.

The Lightning network can execute hundreds of thousands of transactions per second by settling off-chain transactions in a separate ledger, freeing up space on the first layer of the Bitcoin blockchain while respecting the underlying protocol, explained Mr. Strong.

“People want access to bitcoin, the asset … When you look at the stability, security and use of global payments and global transaction aspects, that’s where bitcoin and the Lightning Network go. Shine,” Stark said.

Lighting Labs recently announced a proposal to create Taro, a protocol that would allow people without bank accounts to send and receive money in the form of stack coins representing their national fiat currency through mobile apps.

“If I were Visa, I would be scared, because there are a lot of people who have mobile phones, but they no longer have to log in to the traditional system, and then merchants no longer have to pay the 3% plus 30 øre fee. [pour une transaction]. Fees can be significantly reduced compared to the traditional system, ”Stark told TechCrunch.

Startup Moon actually works with Visa to enable users to purchase goods and services with bitcoin through the Lightning Network at any US-based e-commerce site that uses Visa rails.

As Lightning Labs focuses on optimizing global payments through the Lighting Network, trading platform Robinhood has found the network useful for keeping network fees low on its new crypto offering, as it rolled out to users last month, said Johann Kerbrat, Robinhoods crypto-CTO. TechCrunch.

“We want to support Lightning on the app [Robinhood], so you’ll be able to connect it to pay resellers directly with Lightning Network, ”Kerbrat said. “It also means you can somehow create a channel between people who use Robinhood outside of Robinhood and be able to trade bitcoin for almost zero fees.”

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Thomas Estimbre
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