Binance, one of the main players in the world of crypto, has embraced the Bitcoin Lightning Network, a key tool that makes transactions significantly quicker and cheaper. Lightning now stands as an alternative alongside other choices such as Bitcoin's mainnet, BNB Smart Chain, and Ethereum.
Lightning acts as a Layer 2 solutions to enhance Bitcoin’s performance, much like how Optimism and other L2 protocols boost Ethereum's efficiency. It's like a shortcut for BTC transactions. Instead of every transaction having to go through the main Bitcoin system (which can be really slow), the Lightning Network allows users to send BTC directly to each other. Then, these transactions are bundled together and added to the main system all at once.
However, this shortcut isn't without its bumps in the road. The developers who created the Lightning Network have warned that it's still a work in progress. There might be some bugs in the system that could even potentially lead to the loss of money; things like power outages, computer crashes, and software glitches could pose risks.
Despite these potential issues, the Lightning Network has been gaining popularity since 2020. It's especially handy for small payments and everyday transactions, since when you send Bitcoin using Lightning, it should show up in just a few seconds. For example, Twitter has made it possible to tip people via Lighting using the payment app Strike. Since 2020, the amount of Bitcoin in the Lightning Network has grown from less than 1,000 BTC to about 4,900 BTC now.
Lighting is already available on exchanges like Bitfinex, Kraken, River Financial, and OKX, while Coinbase's CEO, Brian Armstrong, has hinted that they might also join the party. Given the speed and efficiency, wide adoption of the Bitcoin Lightning Network and similar solutions could significantly change the way we use cryptocurrencies.
