Coinbase, one of the leading cryptocurrency exchanges, has recently announced its intentions to enhance cryptocurrency-based payments on a global scale. As part of a broader strategy to provide its users with more convenient and efficient payment options, Coinbase (COIN) is actively exploring the possibility of integrating Bitcoin’s Lightning Network for transactions.
Coinbase Bitcoin Lightning Network for Payments
The Lightning Network represents a second layer for the Bitcoin blockchain, designed to address some of the challenges associated with the scalability and speed of the Bitcoin network. By employing micropayment channels between specialized nodes or software providers, aims to accelerate the processing of transactions on the Bitcoin blockchain while keeping costs relatively low.
We’re looking into how to best add Lightning. It’s non-trivial, but I think worth doing. I’m all for payments taking off in Bitcoin.
CEO Brian Armstrong
The ingenious concept of the Lightning Network relies on the establishment of payment channels between two parties. To initiate a payment channel, both parties need to commit a certain amount of bitcoin (BTC) to an on-chain multi-signature address. This process is referred to as “locking up” on-chain funds. Once the channel is established, the two parties can then conduct an unlimited number of off-chain transactions without requiring the direct involvement of the main blockchain.
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