2019: Bitcoin year in review6 min read
Bitcoin in 2019 saw exciting developments throughout its entire infrastructure. Day-after-day, Bitcoin’s hash power reached new all-time highs to secure the network and the trend continues to grow stronger from the bottom up. As the year winds down and we put a close on the decade, here are a few exciting stories and developments you may have missed on the year. Happy New Year!
The Bitcoin network is becoming more efficient as a majority of transactions spend SegWit outputs. Simply put, there is now a viable path to help alleviate the strain and bloat of transactions on the base layer of the blockchain. Check out Aaron Von Wirdum’s great overview of the SegWit saga and why it matters to Bitcoin today.
A Gathering of Heroes
Among the many wonderful events for Bitcoin this past year; Bitcoin 2019 hosted by BTC Inc, made its mark by gathering the top forefront voices in the Bitcoin and technology space. Discussions ranged from scaling to regulation and everything in between. Special guests included Edward Snowden, Tim Draper, and many other leaders who are now on the Bitcoin journey as well. The event reignited the excitement within the Bitcoin community and brought forth a significant pedigree in upholding the long term ideals of Bitcoin.
Trailblazers stepping it up
Creating the infrastructure for a new worldwide payment network is surely no easy task but the advancement of Bitcoin’s Lightning Network Protocol development of LND by Lightning Labs, C-lightning by Blockstream, and ACINQ, have been nothing short of spectacular this year. Bug fixes, feature rollouts, and impactful research, have proven to be worth it as the Lightning Network (LN) topology becomes increasingly more efficient. Check out the LND updates here, the C-lightning updates here, and the ACINQ updates here.
Although many channels in LN are private, we can infer from the public data on 1ml that the network continues to grow. Since the start of 2019 we’ve seen the public network capacity grow from 515 BTC to 850 BTC, the public node count rose from 4,800 to 10,900 and the public channel count grew from 16,000 to 35,000. All signs are pointing to blast-off!
Lightning Network Wallets
The Lightning Network enjoyed a year of very healthy growth, specifically in wallet development. Buggy wallets with bad user interface created an insatiable demand for something people could use. With an obvious gap in the market, the race began for creating a proper wallet service. Wallet options range from custodial to non-custodial, giving users the ability to choose between the trade-offs.
The number of wallets able to serve LN users will continue to grow as its benefits can not be denied over time. Custodial wallet such as Blue Wallet are a great way for individuals to be exposed to the ease of use of the Lightning Network. For the more sovereign minded individual; non-custodial wallets like Zap and Phoenix, are a great way to set-up your Lightning experience the way you want to.
Lightning Network Applications (Lapps)
With the advancement of Lightning Network wallets came with growth of applications powered by the Lightning Network, better known as Lapps.
One physical experience that got the attention of Bitcoin users on Twitter was the Lapp Pollo Feed ,the first place you could use bitcoin online to feed chickens. For a small fee with instant transactions using the Lightning Network, you can pay to feed some chickens in Rhode Island and see it all on live stream!
The development of the Lightning Network in 2019 proved there is a possible fit for monetizing the gaming industry. The most notable example of the Lightning Network gaming use case is Satoshi’s Games, the online hub for playing games and getting rewarded with Bitcoin.
One for all & all for one
As the development of Bitcoin and the Lightning Network advanced, so did its value from the community. One of the most famous examples of this would be the creation of the Lightning Torch. Created by the pseudonymous twitter user Hodlonaut, this payment experiment began as a fun way for one person to send 100,000 sats to another person and they would be incentivized to add 100,000 more sats and pass it on.
Over 290 torch bearers later, the Lightning Torch had been to 56 countries around the world and was even passed along by the CEO of Twitter, Jack Dorsey! The final balance at the end of the experiment totaled 4.2 million satoshis and was donated to the Bitcoin non-profit Bitcoin Venezuela.
Checking in with Regulators
With Bitcoin’s popularity soaring over the past few years, US regulators have come to chime in on the conduct of Bitcoin businesses. The New York BitLicense was the first major regulatory hurdle put into place by NYSDFS in 2015 resulting in a mass Bitcoin exodus for the state. As of today only 24 companies have been awarded a BitLicense.
Caitlin Long of Wyoming Blockchain Taskforce spoke about how in the near future New Yorkers may be able to take advantage of a loophole which would allow them to operate within the state. Only time will tell how far regulators will go to red-tape operations, but with leaders like Caitlin on our side we can rest assured that the fight continues!
Rise & Fall of Libra
Facebook announced its own cryptocurrency, Libra, which promised to introduce the concept of digital assets to billions of users around the world. With that in mind, traditional payment companies like Visa, Mastercard, and PayPal all pledged financial support to the Libra Project.
Before Libra could be launched, the US congress was already skeptical of the project and cited concerns for data-privacy along with the potential of Facebook becoming a bank. Project head David Marcus & CEO Mark Zuckerburg were both interrogated by the US Congress and the project steadily lost support. Visa, Mastercard, and PayPal would all withdraw their financial support of the Libra project before the end of October.
Though Libra is not directly correlated to the growth of Bitcoin, it does paint a very vivid and dark picture for the regulatory future of alternative cryptocurrencies.
On The Horizon
2019 marked only the beginning of Bitcoin’s maturation phase. Bitcoin exchanges are now beginning to test LN’s waters to see if they may have a competitive edge over one another. Prominent exchanges such as Bitfinex and BTSE look to explore the advantages of LN along with other multi-layered solutions to bring us closer to hyper-bitcoinization.
US entrepreneurs have caught mining fever as several farms will open operation in the coming year asTexas becomes the hot-bed for energy arbitration. Firms such as Peter Thiel’s Layer1 and Whinstone have already laid claim to hundreds of acres of land to mine on. With the US is looking to seriously rival the Chinese Bitcoin mining industry, the future of mining is looking increasingly decentralized.
A Bitcoin focused product that is easy to use is proving to be the ingredient to a recipe for success. The team here at OpenNode has been working hard to bring you just that. Please accept our sincerest gratitude to all of you who keep the Bitcoin dream alive, from merchants to users and everyone else we thank you! See you in the New Year!
Much of this content originally appeared on December 30, 2019’s version of The Watch, OpenNode’s weekly newsletter. If you’d like to subscribe to The Watch and get weekly Bitcoin news delivered to your inbox every Friday, click the button below.