As you read more about Bitcoin you’ll probably come across the term ‘layer 2’. The concept of layers sees Bitcoin as the base layer, with transactions recorded in blocks connected across an ever-increasing chain.
What happens on the base layer is often referred to as happening ‘on-chain’. Transactions that happen on-chain are subject to the consensus rules and with Bitcoin, the limitations of the trilemma.
However, using a second layer that can interact with the base but isn’t subject to its restrictions can enable a solution to the coffee shop use case. This comes in the form of the Lightning Network (LN) which we discuss in the next article.
In summary, LN gives the transaction speed of Visa, at a fraction of the cost. The technology exists, what is missing is the usability and network effects, though the Lightning Network is growing steadily, helped by adoption in El Salvador where it is used for remittance.
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