{"id":75241,"date":"2023-10-21T10:54:38","date_gmt":"2023-10-21T14:54:38","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/crypto\/lightning-labs-wants-to-bitcoinize-the-dollar-with-stablecoins-how-does-it-work\/"},"modified":"2023-10-21T10:54:41","modified_gmt":"2023-10-21T14:54:41","slug":"lightning-labs-wants-to-bitcoinize-the-dollar-with-stablecoins-how-does-it-work","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=75241","title":{"rendered":"Lightning Labs Wants to ‘Bitcoinize the Dollar’ with Stablecoins \u2013 How Does it Work?"},"content":{"rendered":"
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Lightning Labs, one of the major firms responsible for developing Bitcoin\u2019s lightning network, has released the mainnet alpha of its long-awaited \u201cTaproot Assets\u201d protocol on Wednesday, allowing stablecoins and other tokens to functionally trade on Bitcoin.<\/p>\n

In its Wednesday announcement, the firm touted its release as \u201cthe dawn of a new era for bitcoin,\u201d effectively transforming it into a \u201cglobal routing network for the internet of money.\u201d<\/p>\n

\u201cWe believe this new era for bitcoin will see a myriad of global currencies issued as Taproot Assets, and the world’s foreign exchange transactions settled instantly over the Lightning Network,\u201d wrote Ryan Gentry, Lightning Labs\u2019 Director of Business Development.<\/p>\n

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Formerly known as \u201cTaro,\u201d Taproot Assets leverages Bitcoin\u2019s \u201cTaproot\u201d upgrade from 2021, which bolstered the network\u2019s smart contract capabilities while improving the privacy and memory efficiency of transactions.<\/p>\n

Taproot is also the upgrade that inadvertently enabled Ordinals and BRC-20, enabling NFTs and later tokens (mostly including memecoins) to launch on Bitcoin. Unlike Ordinals, however, Taproot Assets structures its transactions to be as data-efficient as possible, allowing for far lower transaction fees and greater throughput.\u00a0<\/p>\n

Upon releasing the BRC-20 token standard in March, developer \u201cdomodata\u201d wrote to Github that Taro is \u201cunequivocally a better solution\u201d for Bitcoin asset issuance.<\/p>\n

For now, the current Taro release supports on-chain functionality, though it will later be compatible with the lightning network. Lightning enables instant and virtually free BTC transfers by processing transactions in private payment channels off-chain, before settling transactions on-chain.<\/p>\n

\u201cUsers will be able to send and receive the currency of their choice over the Lightning Network, using the existing bitcoin liquidity as a global routing currency and Medium of Exchange,\u201d explained Gentry.<\/p>\n

The Importance of Bitcoin Assets<\/h2>\n

Though many Bitcoiners view BTC as a viable currency in and of itself, a growing number of developers believe the Bitcoin network\u2019s potential lies in moving existing currencies on Bitcoin\u2019s rails.<\/p>\n

Paypal co-founder David Marcus, who now spearheads lightning-focused company Lightspark, said in an interview last month that people won\u2019t use BTC to buy things, but that Bitcoin would become a \u201cuniversal protocol for money on the internet,\u201d through which fiat currencies like dollars, euro, and yen could be transferred.<\/p>\n

Tether USD (USD), the world\u2019s largest stablecoin, currently boasts greater daily transaction volume at crypto exchange than any other digital asset.\u00a0
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