Move Over, Ethereum – Bitcoin’s Lightning Network Has Apps, Too


While market analysts have been panicking about crypto winter, Bitcoin builders have been quietly constructing extra apps. According to a report by Arcane Research, the Lightning Network particularly has developed a various ecosystem of over 100 apps throughout no less than 20 classes.

Lightning strikes

Earlier this yr, Lightning’s consumer base shot by means of the roof when Block (SQ) built-in Lightning into its in style Cash App, which has over 70 million users. Just a couple of months earlier than that, in September 2021, Bitcoin market Paxful had built-in Lightning into its pockets and El Salvador’s authorities had launched the Lighting-compatible Chivo bitcoin (BTC) pockets. Paxful has a consumer base of roughly 7 million and Chivo is utilized by 3 million to 4 million Salvadorans (though Chivo utilization has noticeably dropped because the pockets’s launch).

You’re studying Crypto Long & Short, our weekly e-newsletter that includes insights, information and analysis for the skilled investor. Sign up here to get it in your inbox each Sunday.

Arcane Research suggests these three occasions catapulted the Lightning consumer base from a modest 100,000 customers to over 80 million potential customers in a matter of months. It’s essential to notice that many of those potential customers solely have entry to Lightning however don’t essentially use it. Nevertheless, fee quantity subsequently elevated by 410% between the primary quarter of 2021 and the primary quarter of 2022.

Read extra: Block’s Cash App Is Finally Integrating the Lightning Network

As of this writing, the Lightning Network’s capability – the whole quantity of bitcoin within the community – has reached an all-time excessive of 4,351 BTC, equal to nearly $100 million. The list of exchanges that have integrated Lightning is steadily rising, with Kraken, Okcoin and OKEx being the newest additions. According to Bitcoin Visuals, the variety of nodes on the finish of July 2021 was round 13,391. That determine has elevated by roughly 27% to nearly 17,000 nodes. (The precise node depend will at all times be larger as there’s a vital variety of personal nodes that aren’t included in public knowledge.) These will increase in capability, alternate integration and node depend all level towards elevated consumer adoption.

Battle of the layers

A latest tweet sparked a dialog concerning the variety of apps being developed on prime of Bitcoin and Lightning and the way that compares with developer work on different chains.

what number of apps are constructed on prime of btc/lightning? curio the way it compares to dev work on different chains

— alex (@alex) July 20, 2022

How does Bitcoin evaluate with Ethereum and the way does Lightning evaluate with Ethereum’s largest layer 2 scaling system Polygon? A previous CoinDesk article analyzed numbers from enterprise agency Electric Capital’s 2021 developer report. The report estimates that Bitcoin has lower than 700 month-to-month lively builders whereas Ethereum has over 4,000. This is a large distinction, particularly contemplating Bitcoin at the moment has a market capitalization of round $440 billion whereas Ethereum’s market capitalization sits at about $196 billion. The distinction in public possession of the 2 cryptocurrencies is even higher., a preferred cryptocurrency alternate, puts the number of bitcoin owners at roughly 176 million and the variety of ether (ETH) homeowners at roughly 23 million.

Read extra: What’s the Healthiest Chart in Crypto? The Developer Count

Similar disparities may be seen on the layer 2 stage. Polygon claims to have 8,000 month-to-month lively developer groups and 19,000 decentralized functions (dapps) operating on its mainnet and testnet (Polygon’s stay and testing environments, respectively). These numbers dwarf the 100 or so apps within the Lightning ecosystem.

Based on these metrics, one would possibly erroneously conclude that Ethereum and Polygon are more healthy ecosystems than Bitcoin and Lightning. However, a more in-depth look reveals {that a} direct comparability might not be attainable.

First, the Bitcoin blockchain was designed to make bitcoin (the cryptocurrency) its main product. In truth, the Bitcoin and Lightning ecosystems are nearly completely targeted on money and funds. Ethereum, alternatively, was primarily designed to facilitate dapp creation. Therefore, it solely is smart to have extra builders constructing apps on Ethereum than on Bitcoin.

Second, each Ethereum and Polygon are token-focused platforms. Initial coin offerings (ICO), decentralized finance (DeFi) and non-fungible tokens (NFT) are all merchandise of the token economic system.

Arcane Research means that token economies have a tendency to draw extra traders and builders. However, Arcane additionally highlighted the latest enhance in Lightning-focused funding. It can be attention-grabbing to see whether or not investor capital shifts in direction of Bitcoin and Lightning given the recent implosion of prominent DeFi platforms.

100 flashes of Lightning

Arcane Research created an infographic exhibiting an enormous assortment of apps which have been constructed within the Lightning ecosystem.

An infographic showing over 100 Lightning applications across multiple categories (Arcane Research)

Here are some highlights from that assortment:

Lightning-enabled bitcoin wallets

Phoenix is a self-custody Lightning-enabled bitcoin pockets obtainable to each Android and iOS customers. ACINQ, the corporate behind Phoenix, is a French Bitcoin scaling agency that has been round since 2014. The firm additionally created the favored Eclair Mobile pockets, which is one of the first mobile Lightning wallets ever developed. ACINQ has since discontinued Eclair Mobile and recommends Phoenix as a substitute.

Other notable wallets embody BlueWallet, Breez and Electrum.

Node administration software program

Terminal helps Lightning node operators handle their nodes. Lightning infrastructure agency Lightning Labs, creators of Terminal, lately unveiled Autoloop – an enhancement that automates Terminal’s liquidity administration performance. Liquidity on the Lightning Network refers to how simply bitcoin strikes between community contributors. To maximize liquidity, node operators will optimize their nodes in another way based mostly on every operator’s main use case (e.g., sending vs. receiving funds). Autoloop automates this optimization course of.

1/10: Loop helps node operators handle #bitcoin liquidity. Users instructed us that easy automated Loops would assist maintain constant inbound liquidity + management scorching pockets measurement. Today’s launch of Autoloop on Terminal will assist serve these wants.

A thread 🧵 🔁⚡️

— Michael Levin⚡️🍠 (@MichaelLevin) June 29, 2022


Voltage, Greenlight and Bitnoder present managed node operations. If an individual or firm desires to run a Bitcoin or Lightning node (or each), they will merely outsource that total operate to considered one of these companies for a price.

Blockdaemon additionally supplies node-as-a-service options however shouldn’t be Bitcoin-exclusive.

Read extra: What Are Bitcoin Nodes and Why Do We Need Them?

Podcasts and streaming

Fountain and pay content material creators for his or her work. Fountain is a Lightning-powered podcasting platform that pays each hosts and listeners for performing value-adding actions. Hosts get rewarded by listeners for creating high quality podcasts whereas listeners receives a commission by hosts for listening to and sharing podcast episodes., for instance, permits customers to create video content material behind “micro paywalls” – restricted entry that may be unlocked by micropayments as little as a couple of satoshis (one satoshi = 100 millionth of a bitcoin).


THNDR Games is a cellular app that provides bitcoin rewards to players. The app is out there on each Android and iOS and options 4 video games:

  • Bitcoin Bay
  • Bitcoin Bounce
  • Turbo 84
  • Bitcoin Snake

Desiree Dickerson, CEO of THNDR Games, describes her mission as “gamifying the world with bitcoin.”

Read extra: Lightning Payments Come to Mobile Games, Fueling Bitcoin Adoption

Newcomers: Lightning-enabled browser extensions

Developers are including new apps to the Lightning ecosystem frequently. For occasion, Alby is a lately launched browser extension that permits in-browser Lightning funds. It’s like Bitcoin’s model of MetaMask – a extensively used, browser-based Ethereum pockets.

Good Morning.

More than 2000 individuals have now put in Alby’s browser extension.

That is over 2000 individuals sending #bitcoin over the #LightningNetwork seamlessly.

Thank you for selecting Alby 🧡

— Alby 🐝 (@getAlby) July 27, 2022

The views and opinions expressed herein are the views and opinions of the creator and don’t essentially mirror these of Nasdaq, Inc.

Source link


Please enter your comment!
Please enter your name here