Libra creator David Marcus has put forth a compelling argument asserting that the Lightning Network is the singular solution to scale Bitcoin effectively.
Marcus, a prominent figure in the cryptocurrency space, contends that alternative blockchain products either exhibit excessive centralization or lack the necessary security measures.
In a post on X, Marcus first emphasized Bitcoin’s unparalleled status as a neutral settlement asset and network capable of ushering in a new era of global real-time payments. He posits that the competition falls short on multiple fronts — either excessively centralized, insecure, lacking regulatory clarity, or failing to provide the required liquidity against fiat currencies.
First things first — Bitcoin is the only viable neutral settlement asset and network that can…
— David Marcus (@davidmarcus) November 19, 2023
Marcus asserts the importance of faster and more cost-effective Layer 1 (L1) Bitcoin transactions while maintaining trust and security. He sees the Lightning Network as the key solution, allowing accelerated transactions without compromising fundamental principles.
Marcus also acknowledges the challenges faced by the Lightning Network in its earlier stages, including complexity, high failure rates for larger transactions, and issues related to managing liquidity and channel rebalancing.
However, he points out that considerable progress has been made in overcoming these hurdles by developing advanced software and services. As a result, enterprises and custodians can now settle Bitcoin transactions in near-real time at minimal costs, ensuring privacy, compliance, and reliability.
Marcus acknowledges the Lightning Network’s effectiveness but identifies two challenges: offline receipt for self-custody and high channel open fees for smaller transactions.
Initiatives by Lightning Labs, SpiralBTC, and Lightspark aim to tackle these issues, though Marcus recognizes potential compromises on trustlessness.
Looking to the future, Marcus identifies critical areas for improvement. He advocates for the development of fully self-sovereign identity and addressing systems on the Lightning Network. Additionally, he emphasizes the importance of issuing other assets on the network, such as stablecoins, to enhance efficiency for a subset of transactions.
Initiatives like Taproot Assets by Lightning and RGB by Bitfinex are already in progress, indicating a collective effort to broaden the scope and capabilities of the Lightning Network.
In response to Marcus’ statements, Rene Pickhardt, a Bitcoin and Lightning Network developer, agreed on Lightning’s inherent unreliability by design, contrasting it with stablecoins’ trusted nature. Pickhardt raised concerns about integrating stablecoins into Lightning, suggesting it could create an unreliable trusted fiat IOU token and impact routing liquidity.
Lightning = unreliable by design
Stablecoins = trusted by design
Why would one put stablecoins on lightning to create an unreliable trusted fiat IOU token?
Also the stablecoin liquidity might put pressure to the routing liquidity of ln.
Oh and: https://t.co/3Cdv4WVwMu
— Rene Pickhardt (@renepickhardt) November 19, 2023
Marcus disagreed, emphasizing Lightning’s reliability and viewing stablecoins as transaction optimization tools, not core dependencies. Pickhardt clarified his statement, saying that Lightning Service Providers enhance application reliability but maintained that Lightning’s protocol lacks certain features, making it unreliable by design.
The post Libra Creator Champions Lightning Network as Bitcoin’s Ultimate Scaling Solution appeared first on CryptoPotato.
Blog powered by G6
Disclaimer! A guest author has made this post. G6 has not checked the post. its content and attachments and under no circumstances will G6 be held responsible or liable in any way for any claims, damages, losses, expenses, costs or liabilities whatsoever (including, without limitation, any direct or indirect damages for loss of profits, business interruption or loss of information) resulting or arising directly or indirectly from your use of or inability to use this website or any websites linked to it, or from your reliance on the information and material on this website, even if the G6 has been advised of the possibility of such damages in advance.
For any inquiries, please contact [email protected]