Lightning Network grows up: Coingate starts its payments service for merchants
CoinGate becomes the first cryptocurrency payment gateway which use Lightning Network (LN).
But let’s take a step back to understand the reason for this decision.
In fact, despite its indisputable reputation and usefulness, the innovative Bitcoin technology has long showed itself such as unsuitable for a concrete and efficient use in commercial and daily activities, due to the slowness of its transactions and their high cost.
These considerable obstacles have made it difficult and inconvenient to send and receive small amounts of money, thereby reducing the possibility of its global use as an exchange currency.
To address these issues, Bitcoin developers first drew up and used the Segregated Witness technology (with separating transaction signatures), commonly known as SegWit.
In fact, SegWit has made it possible to reduce transaction costs and increase the number of transactions.
But the search for possible solutions to the problems related to Bitcoin didn’t stop and led to the development of what we know by the name of Lightning Network that is a technology that connects users to payment channels external to the Bitcoin Network.
The CoinGate payment gateway recently announced its intention to use Bitcoin Lightning Network (LN) to allow merchant users to accept this type of payment thus finding themselves the first ever to use this innovative technology.
As CoinGate explains on his blog:
“Last month we launched Testnet LN payments in our demonstration shop. Things have been going really smooth, and thus we are planning to more on to mainnet very soon.
Our pilot launch with a select group of merchants is starting on July 1st, and we aim to enable all of our merchants to start accepting Bitcoin and Litecoin Lightning Network payments with our help soon after”.
Among the merchant websites involved we find: hosting websites, online stores, adult entertainment websites, etc.
Although recent research claims that the use of LN is not very reliable, the company, which has always tried to use the new Bitcoin technologies, continues to experiment with the LN implementation with the intention of making this payment service available to traders as soon as possible.