lightning network Archives

Must Read: Four Reasons Why the Bitcoin Bullrun May Be About to Start

Posted on April 23, 2018 | by [email protected]

Post Tax-Day, Bitcoin prices have been on the rise, but considering the massive slump in the first quarter of 2018, many are left wondering if this boom will last. While nobody has a crystal ball that can predict the future, many experts believe that a major rebound is just around the bend.

Thomas Lee, managing partner at the popular financial firm Fundstrat Global Advisors, predicts a record peak for Bitcoin by July. While Lee’s prediction is based on data from Bitcoin’s 22 corrections since 2010, here are some additional reasons why many believe that Bitcoin’s price will continue to rise.

Bitcoin Futures and ETFs

In December 2017, CME and CBOE launched the first Bitcoin futures contracts, enabling consumers to get exposure to Bitcoin price movements without holding any actual Bitcoin. The rollout of these futures exchanges put Bitcoin well onto the mainstream map, and there is speculation that the SEC will soon approve Bitcoin ETFs, as well. According to the SEC, “the agency has started the process to approve or disapprove a change in its rules that allows two Bitcoin ETFs to be listed on the NYSE Arca Exchange.” SEC approval for a Bitcoin ETF exchange will likely further cement Bitcoin’s mainstream presence and, in doing so, have a positive impact on the digital currency’s price.

SEC Regulation

In early March, the U.S. Securities and Exchange Commission (SEC) announced that all cryptocurrency platforms that meet the definition of a “security” must register with the SEC as a national securities exchange. The increase in regulation likely contributed to Bitcoin’s price dip immediately afterwards. However, in the long term, I believe this regulation will protect against scammy ICOs and hacks.

Furthermore, I believe that this regulation is further proof of Bitcoin’s influence at the mainstream level. When an industry scales and grows as fast as crypto, increased regulation is inevitable. We should stop looking at regulation as a barrier to the crypto space, and instead learn to work alongside it to make the industry more compliant, transparent, and reliable than before.

Increased Retailer Acceptance

Bitcoin is currently accepted at several major retailers, including Overstock.com, Expedia, Microsoft, and about another 100 stores with more growing very quickly. Amazon has also secured some cryptocurrency domains, and Starbucks CEO Howard Schultz has expressed his interest in using cryptocurrency for large-scale retail adoption.

“I personally believe that there is going to be one or a few legitimate trusted digital currencies off of the blockchain technology. And that legitimacy and trust in terms of its consumer application will have to be legitimized by a brand and a brick and mortar environment, where the consumer has trust and confidence in the company that is providing the transaction.” Schultz said. With Starbucks going increasingly digital with a wildly successful mobile app, adding cryptocurrency seems like a natural next step.

In the bigger picture, I believe that acceptance by more retailers will increase the number of transactions, wallets created, and overall Bitcoin holdings as more consumers use Bitcoin to pay for goods and services, and that all of this increased activity will continue to boost the crypto economy and lead to a rise in prices.

Lightning Network

On March 15, Lightning Labs launched a beta version of its Lightning Network (LND) software specifically available for the developer community. Designed to tackle some of the limitations surrounding the legacy bitcoin blockchain’s slow transaction times and high processing fees, LND is an “off-chain” solution that uses smart contract functionality to process transactions more quickly and cost-effectively than ever before.

Co-founder of Lightning Labs Elizabeth Stark said that the goal of the Lightning Network is to process “many thousands of transactions per second and maybe someday even millions of transactions per second,” surpassing the capabilities of traditional credit card companies like Visa.

With this kind of technical innovation in the works, I predict that Bitcoin will soon achieve greater enterprise adoption and prices will soar. But it may take a little bit of time. As with this kind of technical innovation in the works, Bitcoin prices are projected to soar. But it may take a little bit of time. As Stark said herself: “Bitcoin is a marathon, not a sprint. People wanted it to be a sprint.”

With so much momentum surrounding Bitcoin and other digital currencies, it seems that Bitcoin prices are on a trajectory to increase. To learn more about diversifying your retirement account with Bitcoin and five other cryptocurrencies, give one of our IRA specialists a call today at 877-936-7175.

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Bitcoin Lightning Startup Goes Beta

Posted on March 20, 2018 | by [email protected]

On March 15, the highly anticipated Lightning Network launched a beta version of its software (LND) that is now available to the developer community. As discussed previously on this blog, the Lightning Network is a decentralized network that uses smart contract functionality in order to enable payments and process transactions off the blockchain. With this launch, the developer community can leverage LND to send Bitcoin and Litecoin to other users, marking significant progress towards improving transaction times, processing fees, and potential for scalability.

Industry Buzz

The developer community is working tirelessly to develop solutions that make cryptocurrency transactions cheaper, faster, and ultimately more scalable. While the LND is just one software of several trying to accomplish this, many believe it’s the most mature software of this type to date.

Establishing itself as a distinguished innovator in the crypto space, Lightning Labs has raised $2.5 million from some of the biggest names in Silicon Valley, including Twitter CEO Jack Dorsey, Litecoin creator Charlie Lee, and former PayPal COO David Sacks.

In addition, BitGo, the blockchain security company that we are proud to have an exclusive partnership with, also offered their support for the launch of LND. “It’s something the entire community has been focused on and working towards for the better part of two years now. It’s really the culmination of a lot of work by many people, not just Lightning Labs…We see it as a very important piece of the scaling solution for Bitcoin, and perhaps other digital currencies as well,” said BitGo CTO Ben Davenport.

LND Software Highlights

Lightning Labs released a comprehensive blog post detailing all of the highlights from this launch. Some of the benefits include, but are not limited to:

A new and improved key creation and recovery system that makes recovery from data loss or corruption simpler and more reliable
Automating the process of sweeping funds back into a user’s wallet. This is now handled by a concert of subsystems in a process known as automated contract resolution that is fault-tolerant and intelligent, which is critical to the safety of funds.
SegWit only. An implemented soft-fork change in the transaction format of Bitcoin, Segwit ensures all transactions, even on-chain transactions, will benefit from lower fees and faster transaction times.

LND Software and Bitcoin IRAs: Why it Matters

While cryptocurrency prices have experienced volatility in recent months, technological advancements like the release of LND software are testaments to the long-term staying power and value of digital currencies in the world today. And this is only the beginning. Jack Mallers, a developer for a user-friendly Lightning wallet that is being built on top of LND, said: “This release is a step forward for the network itself. Before all of the apps, we need to build a healthy network that has liquidity, reliability, high-uptime nodes, healthy channels, etc. We need to onboard an entire industry onto a new layer and build a healthy topology. This release kinda marks the ‘start’ so to speak.”

As the cryptocurrency community continuously works towards implementing new solutions, this industry will likely continue to see even greater mainstream acceptance and adoption at the enterprise level as well.

With BitcoinIRA.com, you can capitalize on all of the exciting innovations happening in the digital currency community by investing in Bitcoin as well as five other currencies in your IRA or 401(k). Call us today to speak to a IRA specialist and learn more: 877-936-7175.

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Will the Lightning Network Transform Bitcoin?

Posted on January 31, 2018 | by [email protected]

With every victory comes setbacks, and Bitcoin is no exception. The digital currency’s massive rise in popularity has presented some limitations surrounding scalability.

Let’s look at the specifics. Legacy Bitcoin blockchains are limited to 1MB in size, and new blocks are added to the chain approximately every ten minutes. Segregated Witness (SegWit), a technique that splits up Bitcoin transactions into two segments and can increase the blockchain size up to 4MB, has expedited the process, supporting up to 16-28 transactions per second. While this is a boost compared to the legacy blockchain, (which is limited to 4-7 transactions per second), many argue that the improvement, in the scheme of things, is minimal. After all, major credit card companies can process tens of thousands of transactions per second.

Ultimately, Bitcoin’s scalability issue and high transaction fees are preventing its widespread adoption at the enterprise level. But the Lightning Network, which is expected to launch in the near future, has the potential to disrupt all of that. Let’s take a closer look.

The Lightning Network

The Lightning Network is a decentralized network that uses smart contract functionality in order to enable instant payments across a network of participants.

Unlike legacy and SegWit Bitcoin transactions, in which transactions are verified and added onto the blockchain, the Lightning Network is an “off-chain” solution in which a system of smart contracts is built on top of the Bitcoin blockchain. Transactions and scripts are parsable, and can be enforced on the blockchain if needed, but otherwise are not bound by blockchain scalability limitations.

Ultimately, the Lightning Network enables lightning-fast confirmation times that can process millions to billions of transactions per second across the network. Once it officially goes live, it has the potential to completely disrupt the enterprise landscape as we know it.

Implications at the Enterprise Level

The Lightning Network’s solutions surrounding scalability and transaction times will make both bitcoin and blockchain technology more applicable at the enterprise level. Many high-profile companies, including Starbucks, are already keeping a close eye on the blockchain and its potential for consumer application. In a recent earnings call, Starbucks Executive Chairman Howard Schultz stated that the coffee giant is in a “very unique position to take advantage of what the blockchain technology will provide.”

Schultz, who predicted a “seismic change” in the retail space due to Amazon and ecommerce, prides Starbucks on its “entrepreneurial DNA” and “curiosity to see around corners and make big bets”, citing the company’s launch of its mobile ordering system in 2015 as an example.

The company, which opened a mobile-only store in Seattle last year, has already begun testing the waters with cashless purchases. While Schultz did not state that Starbucks would be investing in or creating a digital currency at this time, he did note that digital currencies could work well with the mobile payment digital platform they created.

Ultimately, Starbucks is just one major company of many that are evaluating blockchain technology, and digital currencies, in regards to suitability for enterprise adoption. And while the Lightning Network’s launch date is still up in the air, it is this type of innovation, with its scalability, lightning-fast transaction times, and exceptionally low fees that could catapult digital currencies to new heights, transforming and streamlining business transactions in a way that we have never seen before.

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