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Bitcoin (BTC) is a type of digital currency whose peer-to-peer (P2P) technology allows users to engage in transactions with greater speed and efficiency. The gradual adoption of Bitcoin and cryptocurrency in general by financial institutions — and payment giants like PayPal and Square — signals a broader acceptance within financial services, pushing crypto’s evolution to better support its networks.
Essentially, this brings us to the Lightning Network, a second-layer protocol that operates alongside Bitcoin to enhance speed, versatility and privacy and reduce cost.
Key Takeaways:
Launched in 2018, the Lightning Network is a Layer 2 protocol that reduces costs and traffic congestion on the Bitcoin network, facilitating scalability.
Lightning Network boasts lightning-fast processing speeds without going through intermediaries, enabling low-cost and fast decentralized micropayment transactions worldwide.
Lightning Network’s latest upgrade, Taproot Assets, elevates Bitcoin into a multi-asset network by allowing developers to issue stablecoins and real-world assets such as fiat currencies and gold on the Bitcoin blockchain.