In a turn of events, cryptocurrencies have begun to steal the show again away from blockchain.
CEO of Lightning Labs, the developer of the Lightning Blockchain scalability protocol, Elizabeth Stark has spoken out to challenge the Wall Street and traditional financial sector narrative that puts its faith in Blockchain, not Bitcoin, to deliver on the radical promises of the crypto phenomenon, Yahoo Finance reported April 5.
“When we first pitched my company Lightning Labs, we actually took the word ‘Bitcoin’ out of our deck and our marketing material because it was so much about Blockchain. Now, I feel like we’ve entered into a ‘Bitcoin, not Blockchain’ world, where people understand the value of cryptocurrency technology and what these can bring. You also have proof of work in Bitcoin, you have the public/private key cryptography. There are other things that make Bitcoin special. Somehow, the Blockchain part got separated and became a thing.”
Stark reflected on the rise of blockchain before seemingly at the cost of bitcoin, the latter of which had become taboo in financial services. Lightning at the time was developing bitcoin software, and Stark and other developers knew that the banking industry’s decision to shun bitcoin was misinformed.
Other blockchain veterans have previously pointed out that “blockchain doesn’t exist without bitcoin” because of the miner-fueled network.
Stark and Lightning were vindicated with the rise in the market capitalization not only of bitcoin but all the leading cryptocurrencies at year-end 2017. While the prices have since pulled back, that’s actually not such a bad thing when you’re a developer in the bitcoin space. “Big price spikes aren’t good for us technical folks that are developing,” said Stark, adding she “wants things to be calm.”
Lightning is behind the Lightning Network software, which is in beta format. It sits atop Bitcoin to deliver faster transactions and more of them. Lightning Network can also be accessed via mobile.
You hear a lot about the use cases for bitcoin being a store of value and for payments, the latter of which has been problematic amid lengthy and costly transactions. But the Lightning Network looks to solve that by facilitating transactions off the blockchain between the buyer and seller instead of relying on the volunteers to verify each transaction. But it’s still close enough to the blockchain if it’s needed. It opens the door to more possibilities for bitcoin and micropayments, as the Yahoo panel suggested.
Stark provided a glimpse into the roadmap for the Lightning Network, including “many thousands of transactions per second and maybe someday even millions per second,” which dwarfs the capabilities of Visa. No wonder Visa executives feel threatened by bitcoin. Especially considering it remains early innings for bitcoin.
Among the behemoths of traditional finance, skepticism about cyber-risks, price volatility, and the inadequate market integrity of the crypto sphere has led many to support co-opting of Blockchain tech even as they castigate cryptocurrencies themselves.