The under is a direct excerpt of Marty’s Bent Issue #1183: “Tether has been sent via the Lightning Network” Sign up for the newsletter here.
Above is a video demonstration of the primary ever Tether transaction over the Lightning Network executed by Corey Phillips from Synonym.
For these of you who are unaware, Tether is a US Dollar stablecoin that lives exterior of the incumbent monetary system and is moved over cryptocurrency networks. Tether is centralized because it managed by an organization that retains a reserve of USD and different belongings (together with bitcoin) that are reported to again every Tether one-to-one with a USD equal. The US authorities has been coming after Tether for years as they have efficiently operated exterior the normal system whereas serving customers all over the world. All of this is to say that I might not advocate holding Tether except it is completely needed to make a transaction.
With that being mentioned, there is little question that there is vital demand for Tether globally as people search to keep away from the short-term worth volatility of bitcoin. Many individuals in rising economies do not have the luxurious of sitting again and stomaching the rollercoaster worth actions in bitcoin and choose to retailer a few of their holdings in stablecoins so they can maintain with out fear of not having the ability to buy what they need when they go to spend. Many bitcoiners don’t love this truth but it surely is a incontrovertible fact that needs to be acknowledged.
What’s attention-grabbing about Synonym’s implementation of Tether on Lightning is that it leverages the Omni Layer protocol, which is the place Tether initially launched. As on-chain charges elevated within the years after Tether launched on Omni Layer Tether utilization migrated to different chains to reap the benefits of their comparatively low charges and has since been enjoying a sport of sizzling potato. Hopping from one chain to the subsequent.
Is Synonym’s implementation of Tether on Lightning one thing that can push Tether utilization again to the bitcoin stack because the Lightning Network at the moment supplies sufficiently low charges on high of essentially the most safe ledger on the planet? We shall see. In your Uncle Marty’s opinion, it will be cool to see Tether (or common stablecoin utilization) migrate again to bitcoin even when he does imagine that the USD is failing miserably and stablecoins function nothing greater than a transitional mechanism that gives a little bit of volatility cowl as we transfer from a fiat commonplace and a bitcoin commonplace.
At the very least, Synonym’s efforts are pushing the boundaries of the design panorama on Lightning, which is very cool to see. As we mentioned yesterday with regard to BIP47 being applied within the Bitcoin Dev Kit, will probably be attention-grabbing to see how the usage of OP_Return, which Omni Layer leverages, will create pure scalability ceilings that make this use case a brief blip within the lifetime of bitcoin.
