While Bitcoin is the undisputed king of all cryptocurrencies, it’s frequently criticized because of the time it takes to complete a transaction, the lack of scalability and the vast amounts of power it takes to keep the blockchain going through mining.
That’s why the Lightning Network has been developed and deployed. It is a second layer for the Bitcoin blockchain and network which is meant to address the problems of speed and scalability and to increase every user’s privacy. Another notable innovation it brings is the Atomic Swaps.
The Atomic Swaps
Atomic Swaps allow converting your currencies from one to another. This is possible thanks to a smart contract technology known as hash-time locked contract (HTLC). This kind of contract ensures the safe exchange of currencies by enforcing pre-set parameters. The trade must be completed within a given time limit, and the transaction must be completed from both sides before any funds are released.
The main consequence of this protocol is that it eliminates the need for any central service, authority, arbiter or third party. It also helps to decentralize the coins involved in the HTLC because users don’t need to keep their currency stored in wallets or exchanges.
Let’s clarify one crucial feature of the Lighting Network. While it’s currently associated mainly with Bitcoin, it’s not specific to it at all; it’s just a layer of new protocols that can be integrated into any other blockchain which is excellent news for the community at large. Many other cryptocurrencies have already announced the intention to adopt the Lighting Network (Zcash, Decred, and Litecoin among others) to some degree.
Litecoin is, of course, a Bitcoin fork created by Charlie Lee, a former Google developer. Because it uses the same blockchain but it’s faster and lighter, the Litecoin blockchain has been used very often as a sandbox for Bitcoin. Mr. Lee was even the first person ever to complete an atomic swap last year.
Because of the close relationship and technical similarities, there are between BTC and LTC; the early users will find more advantages in using those two tokens to do atomic swaps. Mr. Lee said that,
“Litecoin will also be the easiest onramp onto the Lightning Network. BTC takes too long and fees to high? No problem. Open an LTC payment channel on chain cheaply and quickly, then atomically swap for BTC if/when you need to. This can be done in one step sing submarine swaps!”
Mr. Lee considers the Lighting Network’s functionality akin to a decentralized exchange because transactions can be carried out by any two parties in agreement without any third party or central authority. Litecoin’s creator added that the,
“Lightning Network will be the ultimate decentralized exchange. Users that are running LN on both BTC and LTC can advertise an exchange price and act as a maker earning a spread. Other users can act as a taker and atomically swap LTC/BTC with the maker node via lightning.”
The Lighting Network is a very promising protocol. It could just be the thing that solves many of the pending issues with the Bitcoin network and many others as well.
Because of its versatility, it can, and should, be adopted by many different blockchain networks and currencies. Adoption by several such projects would be a great benefit for the crypto community as a whole.
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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.
Image courtesy of Maxpixel.net
Aluna.Social is a Compelling Social Platform for Crypto Traders and Investors
When one thinks about the social media landscape, the companies that first come to mind are most likely Facebook, Instagram, LinkedIn, and Snapchat. These platforms are a great way to stay connected with friends, families, and colleagues, especially when geographic distance is a factor. But, in addition to just chatting about life in general and sharing pictures, social media can be used to bridge the information gap that exists within the investment community.
Over the last decade, many trading offices have been established in large cities all over the world which allow solo traders and investors to pay a monthly fee in exchange for a workspace. The real benefit to trading in these offices is to participate in the free flow of trading ideas and information. Proprietary trading is one of the most challenging careers to be successful at and the exchange of ideas is almost required in order to succeed. Traders at hedge funds and investment banks work in teams so why shouldn’t remote traders?
While these trading offices are a great way to help bridge the information gap, Aluna.Social may provide an even better way, especially as it relates to cryptocurrency trading.
Aluna.Social, founded by Alvin Lee and Henrique Matias, is a multi-exchange social trading terminal for crypto traders and investors. The goal of the platform is to help newcomers shorten their learning curve,…
CoinFlip Scores Big with BRD Wallet Partnership
As the crypto markets move closer to mass adoption, one of the keys for future success will revolve around attracting as many market participants as possible. While many crypto users are extremely tech oriented, a lot of those on the sidelines are not. The cause of waiting on the sidelines could be due to a variety of reasons such as fear of the unknown, lack of knowledge, age, or a combination of all of the above. In order to entice new users to join the crypto revolution, crypto ATMs are rising up across the country. Of those, the largest and most influential crypto ATM company by a significant margin is CoinFlip.
In early October, CoinFlip announced on its Twitter that it had officially partnered with BRD Wallet to re-introduce their crypto ATM map. Now, BRD wallet users will be able to locate their nearest CoinFlip ATM and receive a 10% discount for both buys and sells. BRD brand awareness is growing quickly within the crypto community thanks to its innovative and entrepreneurial spirit. The team strongly believes in the value of financial freedom and independence, and want to empower people across the world by leveraging the possibilities that Bitcoin and other cryptocurrencies provide.
Cryptocurrencies are already making a huge difference around the world. Citizens of Venezuela, a country devastated by rampant inflation, have been using several cryptocurrencies…
Cryptocurrency Collateralized Debt Positions Are Growing in Popularity
While Bitcoin (BTC) continues to hover around the magical 10,000 price level, altcoins continue to fight an uphill battle. Simply put, hopes of a future bull run continue to diminish as Bitcoin maintains its dominance. One school of thought is that a few altcoins will survive and flourish, but which ones are anyone’s guess. That being said, it’s hard to go wrong picking against the top coins like Ethereum (ETH), Ripple (XRP), Litecoin (LTC), and EOS. These projects have managed to find a foothold in the market and have a better chance than most of staying there. While traders wait for their positions to increase in value, one opportunity that may be worth looking at is initiating a collateralized debt position.
What is a Cryptocurrency CDP?
In traditional terms, a CDP is essentially putting up collateral in order to receive a loan against the deposited amount. There are several examples of this in our day to day lives. Auto title loans from large companies like TitleMax are extremely popular with consumers. Consumers are essentially able to use their car as collateral in exchange for a cash payment which can then be used for whatever needs the consumer has. The consumer can continue using their car as long as debt payments are made.
The same concept applies to cryptocurrency CDPs. Consumers are able to put up crypto tokens, such as…
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