Bitcoin has hit another milestone thanks to Fold, a cryptocurrency payment startup that has allowed users to buy pizza from Domino’s using the Lightening Network.
A history of fraud and uncertainty caused a mass exodus from the crypto verse led by Wall Street investors after the legitimacy of crypto as a valid payment option was brought into question.
Now, Fold seems to have a working solution to Bitcoin’s huge scalability problem, and this could likely tip the scales in favor of the digital currency’s mainstream application.
The Lightning Network Solves Bitcoin’s Scalability Problems
The Lightning Network (LN) could be what Bitcoin needs to finally become the peer-to-peer decentralized currency it was expected to be when it was launched 10 years ago.
Anyone who’s familiar with the digital currency knows that scalability is by far its biggest issue. Limiting the number of transactions on the blockchain to just seven per second has had a negative effect on Bitcoin through contributing to the massive time and cost overheads that have relegated the coin to the fringes of mainstream adoption.
LN addresses this issue by conducting transactions off-chain, offering what’s known as a “layer-2” solution by forming direct payment channels with parties within the network.
The difference in transaction speed is enormous. Up from seven transactions to millions every second, LN proves to be exactly what Bitcoin needs to finally become a mainstream payment solution.
The fact that it is built atop the Bitcoin blockchain network means there’s no tweaks or fixes to be made on the original network, which would be an uphill endeavor requiring all the participating nodes across the globe to be updated.
Bitcoin’s Long Relationship with Pizza
If you recall the early days of Bitcoin, you’ll remember that some of the first Bitcoins were used to purchase two Papa John’s pizzas in 2010. Back then, Bitcoin was more or less founder Satoshi Nakamoto’s dream, being the future currency of the Internet.
Whether Nakamoto would have been proud of Bitcoin’s tumultuous journey to mainstream adoption is up for debate, but nine years after the first pizzas were purchased using non-traditional digital currency, LN has made it one of the few things Bitcoin users can manage conveniently.
So far, over 150 people have used Bitcoin and LN to get their hands on some pizza using Fold’s web-based portal. The company is hopeful that this number will rise once services like Starbucks, Uber, Target, Dunkin’ Donuts and Whole Foods are operational on the network.
Will Reeves, a product lead at Fold, laid out some interesting facts after a successful week of pizza purchases using the service. He noted that:
- The average Lightning payment went up from $5 to $25 during the Domino’s experiment alone.
- A total of 26,588 purchases were noted, and they were all evenly distributed across every state in the U.S.
- Fold has so far generated a cool $2.4 million following the Domino’s experiment. Last month, the take in was 39 percent lower than this.
The seven-man startup is now planning to launch the Fold app for iOS and Android in the coming months as they continue to raise funds and attract new merchants to their service.