Over 4,000 merchants can now accept Bitcoin payments on the Lightning Network (LN).
Lightning payments are being implemented through CoinGate, a cryptocurrency payment gateway. As a second-layer scaling solution for Bitcoin (BTC), Lightning transactions are much faster and cheaper, and can improve the cryptocurrency’s chances of becoming an everyday currency instead of a store of value like gold.
CoinGate, based in Lithuania, has been piloting the LN integration, which was developed by Lightning Labs, with a test group of 100 merchants.
Through the platform, shoppers can make ordinary purchases that are settled instantly and cost minuscule fees, because payments on LN don’t need block confirmations. Instead, LN payments use smart contracts that enforce security and allow merchants to ship goods almost instantly without risk of chargebacks or fraud.
“CoinGate takes every opportunity to innovate and offer cutting-edge solutions to our users. We are keen believers in cryptocurrencies as a way to transact globally, and the Lightning Network, although still a fresh new technology, fits exactly in our vision of what Bitcoin should be in the future”, says Dmitrijus Borisenka, co-founder and CEO of CoinGate.
Unlike the Bitcoin blockchain which enforces a comparatively large minimum output size and a fixed per-transaction fee, LN allows minimal payments denominated in Bitcoin down to 0.00000001 BTC. By enabling micropayments, Bitcoin can be fractionalized into virtual pennies, nickels and dimes, powering an entirely new range of transactions.
Having productive time at #TCDisrupt! We're ready to show that buying coffee with #Bitcoin is absolutely possible. Meet us at booth G109 at Start-up Alley and we will prove that #cryptocurrencies can be a great payment method! And yes #BitcoinIsBetter pic.twitter.com/UV5Q89fc4Y
— CoinGate (@CoinGatecom) September 5, 2018
By implementing Lightning Network, CoinGate says it is “dramatically reducing the technical barrier on the merchant’s side, essentially making it effortless, while users can enable or disable Lightning with a toggle of a switch.”
“The pilot phase allowed CoinGate to evaluate potential risks associated with the off-chain payment method. As LN is still due to be fully tested for live usage, CoinGate had to make sure transactions were secure and if a mistake was to happen, the company was ready to cover the losses for their clients. During the eight weeks of testing, however, the system did not experience any major errors and was ready to sustain high volumes.”
Bitcoin Lightning Network payments on the CoinGate platform debuted in San Francisco on September 5th during the TechCrunch Disrupt conference.