Last week, one of the most anticipated and exciting crypto conferences took place in New York. I’m of course talking about MCC 2019 – the Magical Crypto Conference – organised by Riccardo Spagni (Monero), Samson Mow (Blockstream), WhalePanda, and Charlie Lee (Litecoin).
I highly advise you to watch the conference – which is now available on YouTube – as really cool speakers like Adam Back and Luke Dash Jr gave some quite interesting presentations. The conference mainly focused on Lightning Network (LN) improvements and on privacy, as those are the two main current Bitcoin bottlenecks: transaction speed (scalability) and privacy (security).
Another awesome conference that took place last week was Consensus 2019 – one most of you are probably aware of as it usually greatly impacts the price of Bitcoin.
The conference covered great improvements being made both in Bitcoin and altcoins which will help immensely with adoption when the next bull run comes. We shouldn’t forget how high fees were during late 2017, when the previous bull run took Bitcoin close to $20,000.
If we want to avoid the same problems, we ought to focus on making, testing, and deploying quality developments and improvements before the next wave arrives. Otherwise, we’ll face problems like insanely high fees, terrible hacks from low-security exchanges, and new scams.
Before we dive deep into the technological fundamentals, I would like to reiterate that the bull market is coming. If we look at the recent Google trends, we see people are becoming interested in Bitcoin again, which is starting to show in terms of price. We’re already above $8,000 and the total market cap has surpassed $240 billion, while Bitcoin dominance is reaching new yearly highs above 55%.
At the time of writing, the adoption of the Lightning Network has been quite astonishing. Last year, it went from being just a test network to a real-life payments channel working on top of Bitcoin after the community pumped its usage with the “LN torch”, an event that took a Lightning invoice across many cryptocurrency enthusiasts.
As explained previously here, the Lightning Network is a payments channel linked to the Bitcoin network, meaning there can be many different implementations of the same protocol by multiple companies. The Lightning Network refers to both Lightning Labs’ LN and Blockstream’s LN.
Instead of relying on hard forks to upgrade transaction storage per block (block weight), the LN allows for the integration of off-chain payment state channels between nodes. So instead of validating all information on the main chain, the LN creates direct off-chain connections between nodes, which are opened up by storing Bitcoin on that channel.
Since the introduction of the Blockstream Store, the Lightning Network has grown tremendously. At the time of the announcement, the Lightning Network had a total of 46 open channels and 0.682 BTC in capacity. Nowadays, there are roughly 40,000 open channels with a capacity of over 1,000 BTC and more than 4,000 live nodes.
Not only that, but Lightning Loops and Submarine Swaps are being implemented as well this year. While the first upgrade allows for new low-cost features – which could convince more traditional businesses to accept Lightning as a form of payment – the second is designed to facilitate the transfer of on-chain BTC to an off-chain Lightning Network channel.
This would also please any Bitcoin or crypto enthusiasts who want to buy low-value items (under $10) with a zero-fee transfer of Bitcoin via a contactless payment from their smartphone.
Not only is the LN making steady progress, but some of the most prominent coins of 2017 are also pushing forward in terms of development and adoption.
Firstly, I would like to highlight that NEO has moved its offices to Seattle in the hope of attracting more partnerships with prominent traditional businesses – which is great considering NEO is soon releasing its 2.0 version which builds on top of the current ecosystem in order to achieve a decentralised smart-economy.
Secondly, I would like to underline the amazing efforts of the Ethereum ecosystem in supporting awesome projects like Omise Go (OMG), Status (SNT), Raiden Network (RDN), and Kyber Network (KNC).
While the first two projects are creating applications and platforms that allow users to exchange value easily in a P2P format with minimal fees and hassle, the other two projects are targeting the exchange of tokens. Raiden is said to be Ethereum’s Lightning Network as it’s creating a payment channel on top of Ethereum. Kyber is developing atomic swaps to allow users to exchange tokens directly in Ethereum, without going through centralised exchanges.
My personal opinion is that the cryptocurrency ecosystem is developing quite nicely, and we should expect massive improvements before the next bull run is here.