Robert Steinadler, 6 months ago

MicroStrategy is betting big on the Lightning Network

MicroStrategy is holding the largest stake in Bitcoin of all companies in the world. While it was impressive that the company kept buying Bitcoin on a regular basis, it is almost not newsworthy to report that MicroStrategy continued and also bought more BTC this month. It seems that converting all of its cash into the hardest digital asset in the world is not enough.

What is the Lightning Network, why is it important and what is MicroStrategy building on top of it?

Lightning Network will revolutionize payments

The Lightning Network is a so-called second layer protocol that runs on top of Bitcoin. It is an improvement because transactions can finalize on-chain at a later point in time while at the same time providing the security of Bitcoins blockchain.

This is an advantage is used when it comes down to payments. The Bitcoin blockchain produces a new block every 10 minutes on average. When using the Lightning Network, the transactions settle instantly. In theory, this would allow Bitcoin to scale drastically and make it a monetary network that could settle millions of transactions per day.

After developing the Lightning Network for several years, the technology becomes more reliable and its adoption increases steadily as data clearly shows.

MicroStrategy is starting a SaaS platform

Currently, the company is looking for a software engineer to build a software-as-a-service platform based on the Lightning Network. The job offers reveal that MicroStrategy is looking forward to building an enterprise platform that is supposed to drive eCommerce to the Lightning Network, as well as to address cybersecurity issues.

It remains to be seen if such a product can attract customers. PayPal has entered the market in the US and technically it is possible to pay Bitcoin already using various other services or accepting it directly via the Lightning Network.

Perhaps the biggest use case of Lightning is yet to be fully discovered. With the plans on starting TARO, Bitcoin could finally see its own ecosystem of tokens and decentralized financial applications. The fact that MicroStrategy is staying on its course is not ultimately bullish under the current circumstances, but it also points out that the company is not only looking into a “buy and hold” strategy. With more professional services that make use of Lighting the probability increases that it will take off one fine day. In theory, the Lightning Network is much faster than any other blockchain technology. This is why it is still the biggest of many companies involved in the Bitcoin space.

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