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- Musk tweets in favour of a double layered blockchain network to speed up transactions at a cheaper cost
- Malicious activities and zero offline payments in the latest technology will dampen interest from several parties involved in the blockchain process
- Watchtowers and sufficient vigilance should see through the implementation of the Network on a grand scale
Bitcoin transactions have the potential to double up their speed and execution time with something known as the Lightning network. It will enable cheaper, quicker and efficient transactions at all times and helps in reducing energy emissions. Moreover, Musk is in for the network that may help Bitcoin payments throughout the world. There are possibilities of another U-turn by Tesla owner to accept cryptocurrency as a means of payment if things go ahead in a sustainable manner.
Energy usage is alarming and needs to be curtailed
In a series of tweets, Musk has stated that mining activities by top 10 crypto organizations show that harmful energy proponents are emitted that is detrimental for the ecosystem. The Lightning Network is the need of the hour as massive economies of scale should take place. Subsequently, it will lead to innovation of energy efficient machines and reduction of harmful gases. The load on the original network will reduce as the 2-layer upgrade in the Network will process Bitcoin quickly.
In order to move funds throughout the network it costs $13 and 14 minutes to execute. With the introduction of the Lightning Network, transactions will be carried out instantaneously and take 100 millionth of a Bitcoin as fees. However, the new network is not default free as it suffers from a number of pitfalls.
Downside of a Lightning Network may question upgrade
As transactions will soon take place above and beyond the scope of the blockchain network it will compromise the decentralized feature of Bitcoin and other cryptocurrencies. It is an important goal to take DeFi’s objectives to the masses but not at the cost of its core competence. Musk too regarded it as a grey area where research and innovation is the need of the hour.
Although tweets from the SpaceX and Tesla owner have wiped out $600 billion from the last week of trading, the proposal of a lightning network did not have a huge impact on price. Additionally, offline payments cannot take place in the Lightning Network and remaining online for longer hours is detrimental too. To add to the current woes, routing fees may not provide incentive to miners to carry out work efficiently.
The future looks bright with the advancement of the Network
Critics argue that there are possibilities of malicious attacks with the new technology but larger payments can still take place with proper vigilance. Watchtowers will be placed at a number of nodes to prevent fraudulent payments to go through. The Network has a lot of scope to develop and offer a smooth trading network for all investors.
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
