Twitter’s Bitcoin reward function uses “satis” as the unit of valuation.
Original title: “Twitter announced support for the Bitcoin Lightning Network, which is more “grounded” than Facebook’s Libra? 》
Written by: Hebao
On September 23, Twitter announced that it has launched the tipping function that supports Bitcoin payments in the iOS version of the App, and will launch it to Android users in the next few weeks.
As shown in the figure above, users can freely choose different amounts of Bitcoin for tip payment with this function. The top is displayed in US dollars equivalent, and the bottom is the number of bitcoins denominated in “satoshi”. Taking the first payment option as an example, 2261 is “2261 Satoshi’s Bitcoin”, and the market price at that time was $1.
So, what is “satis” and how might it affect Bitcoin’s subsequent payment adoption?
What is “satisfaction” and what are its effects?
First of all, we need to make it clear that “satoshi” is the smallest basic unit of bitcoin pricing (Satoshi, referred to as SAT), 1 bitcoin = 1 billion satoshis; 1 Satoshi (SAT) = 0.000001 BTC.
Price advantages in consumption scenarios such as payment and transfer
“Cong” has been born as early as at least 2011, but it has not received mainstream attention before due to the combined influence of various factors such as the relatively low unit price of Bitcoin. Now with the price of tens of thousands of dollars per bitcoin, in the field of payment and transfer, the meaning of “satis” compared to direct BTC pricing is reflected:
Taking the above picture as an example, 1 US dollar is 0.00002261 BTC. If the price is marked according to this, it will undoubtedly become very troublesome in actual payment and transfer.
However, if the price is “satis”, 1 US dollar is equal to 2261 SAT, so it will be much more convenient whether it is when paying for transfers or when recording. It is undoubtedly suitable for small transfers and payment scenarios.
Jesse Xiong, the legal representative of JP Morgan Chase, has a similar idea. He once publicly stated that the reason “satis” is becoming more and more popular is that it is relatively simple to record in units, and a large number of decimals seem to really make People have a headache.
The “psychological threshold” on exchange is lowered
In addition, not only is the user’s cognitive advantage of price tagging when paying and transferring money, but from the perspective of exchange, it can actually lower the psychological threshold of incremental users.
In the traditional financial market, if the value of a single stock is relatively high, the company may decide to split the stock in order to attract more ordinary investors and lower their purchase and psychological thresholds. Just like Tesla’s previous stock split plan, many ordinary investors have the opportunity to participate (from thousands of dollars per share to only a few hundred dollars per share).
The same principle also applies to high-priced bitcoins. Although there is no minimum limit of one lot or one share for the purchase of cryptocurrencies like stocks, it is like Dogecoin and other generally low-priced MEME Tokens that are undoubtedly detrimental to ordinary investors. The language is more psychologically attractive-it looks cheaper and more cost-effective.
This is why when ordinary investors first enter the market, they mostly choose cryptocurrencies that seem to be cheaper.
Not long ago, a cryptocurrency platform in the industry announced that it would open the “Satoshi” exchange mode for all bitcoin exchanges. Users can choose to exchange BTC in SAT units in their account interface settings. For example, when the “Satoshi” mode is enabled, BTC /USD will be displayed as SAT/USD, and ETH/BTC will be displayed as ETH/SAT.
However, the latter is more of a psychological impact, but the former, which uses “satoshi” as the unit of small-amount bitcoin payments and transfers, may be crucial to the next stage of bitcoin’s development-it is very likely to become bitcoin in the future. The payment field is a key help in regaining the attributes of “global currency”.
In the documentary “New Blockchain”, the host tried to experience paying with Bitcoin, but buying a tiramisu worth $4 would cost more than $20, which is several times the value of the product itself. .
This is not an isolated case, but a true epitome of the fact that Bitcoin has become more and more difficult to use in the payment field in the past few years. ).
Especially in the context of institutional admissions and price increases in 2020, the asset attributes of Bitcoin digital gold have faintly overwhelmed the payment attributes of the “global currency”.
With the new development momentum of the Lightning Network, “satis payment” ushered in a turning point
For Bitcoin, which can only process 7 exchanges per second, how to achieve instant payment in small, high-frequency, and fast retail scenarios has once become the biggest pain point of its global payment currency vision. And the Lightning Network (Lightning Network) ), it is the main solution for Bitcoin to strengthen the payment attributes.
The Lightning Network, which was launched in the beta version in March 2018, is Bitcoin’s second-layer off-chain expansion solution. Its main principle is: putting operations outside the Bitcoin main chain, allowing users to pay lower fees and Deposit and transfer Bitcoin with higher efficiency.
However, in 2019 and 2020, the development of Lightning Network was not satisfactory. The overall growth rate was very slow. It was even crushed by ERC20 Bitcoin (WBTC, etc.) after the launch of DeFi Summer. Those who had high hopes on the Lightning Network gradually became discouraged.
But since 2021, especially in the past six months, the Lightning Network has unknowingly ushered in an explosion. As of September 26, the number of Bitcoins locked in the Bitcoin Lightning Network exceeded 2,900, a record high.
In the past year, the number of nodes in the Bitcoin Lightning Network has increased from 7,500 to more than 15,000, achieving a nearly double growth.
Especially in the previous mid-June, the number of Bitcoins in the Lightning Network was only 1,500, which directly doubled in three months, which is equivalent to saying that the Lightning Network has completed the growth of the past three years in the past three months. The amount of road.
In addition, unexpected progress between institutions and countries may have been the biggest boost during this period. Under the tipping function introduced by Twitter this time, it has integrated Bitcoin through the Lightning Network, allowing users to use the Strike Wallet to make small bitcoin payments through the Lightning Network.
The adoption of El Salvador has enabled the Lightning Network to take an important step in large-scale payments.
According to the latest statement by the President of El Salvador, Nayib Bukele, only three weeks after the launch of the cryptocurrency wallet Chivo, the country has been actively used by 2.1 million people (the country currently has about 6.5 million), and the number of users of the wallet is more than any single bank in El Salvador. Has a large number of users, and will exceed the sum of all bank users in the future.
“Satoshi” + Lightning Network, a new beginning of Bitcoin payment properties
From this point of view, “satoshi”, with the continued vigorous development of the Lightning Network, is very likely to become the basic unit of valuation for Bitcoin in the next stage.
“If the entire industry uses Satoshi as the pricing unit, then it will become a very important part of the Bitcoin blockchain. ” In May of this year, Mike Novogratz, CEO of Galaxy Digital, tweeted to suggest that the platform use “satis” as the platform Bitcoin unit.
Mike Novogratz explained that too many people think that Bitcoin is too expensive. He called on Coinbase, FTX and Gemini to use satoshis as a unit of measurement to make Bitcoin more attractive to ordinary people.
Especially in conjunction with the Taproot upgrade at the end of the year (an extended reading of “Bitcoin’s first major upgrade in 4 years, what major changes has it brought?”), the privacy of the Lightning Network can be improved by making the channel look like a regular Bitcoin exchange, perhaps Replenishing Bitcoin’s status as a global currency makes it more advantageous in the positioning competition with “digital gold”.
2021 may be the first year when “satoshi” will gradually become the basic unit of valuation in the next stage of Bitcoin, and it will also be the beginning of the return of the payment attribute of Bitcoin’s global currency to the center of the stage.
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