Bitcoin:Then and Now

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Matthew Bonwick

Bitcoin: Then and Now

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2018 was a whirlwind of a year for digital currencies and Bitcoin; the crypto market lost nearly 700 billion in valuation, numerous hacks and other scandals dominated the headlines, and the overall doom and gloom made it difficult to sift through the noise. If you were successful in doing so, then you would have noticed some amazing developments going on. Projects that were under development for years, such as Lighting and Liquid, went live, and Bitcoin was brought to Ethereum through the efforts of the WBTC DAO!

With 2019 marking 10 years since the Bitcoin genesis block, we thought focusing on the endeavours of these project would be a great piece to write about - and hopefully, the doubters of what Bitcoin aims to achieve can have some positivity instilled into them.

Lighting...Liquid. What does it all mean?

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A rendering of the nodes and channels on the Lightning Network. Original Source: https://bit.ly/2V9v5Xo

The Lighting Network is Bitcoin’s main focus for scaling payments, it is a second-layer payment channel network. And while the whitepaper was written in 2016 - it wasn’t until 2018 that a live product was usable. This is not without justification, the Bitcoin Core development team has always been careful with developments around Bitcoin, and complete security is a must if the Lighting Network is ever to be fully embraced. Luckily some of the best engineers in the world are working on Lightning, and thanks to development teams like those from Blockstream and Lighting Labs, as well as a community eager to implement it, Lightning had grown to a network of 2800 nodes with 20000 channels by the end of 2018. Further developments are underway to optimize the protocol and 2019 is sure to be a big year for Lightning.

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Liquid by Blockstream is one of the best researched Sidechain projects in all of crypto. Original Source: https://bit.ly/2H3H7Jv

Another 2nd layer development, Liquid, a sidechain protocol allowing a massive increase in transactions between some of Bitcoin’s biggest companies, was launched in October. In development for three years, the federated sidechain protocol finally went live in 2018. Though it is not the trustless sidechain protocol initially envisioned - Liquid is still an impressive project to say the least. By allowing exchanges to move their transfers off-chain, better arbitrage and tighter spreads will reduce the price differences between exchanges. Additionally, all Liquid transactions are cleared and settled in 2 minutes - so you can say goodbye to waiting for 10 confirmations for your Bitcoin to deposit to an exchange!

Bringing Bitcoin to Ethereum!

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Wrapped Bitcoin aims to integrate Bitcoin into the Ethereum ecosystem of dApps. Original Source: https://bit.ly/2GT3WOG

The wrapping of non-ethereum tokens has been a development that many, including Vitalik Buterin, have hailed as something to pay attention to. The idea being that non-ethereum assets, through “wrapping” to the ERC-20 standard, can be bridged and exchanged in the Ethereum ecosystem. By bringing Bitcoin to Ethereum, the DEXes for the first time can access the liquidity of Bitcoin! On top of that Ethereum smart contracts can now, for the first time, be programmed to integrate Bitcoin payments, adding another popular currency to the ever-developing field of Ethereum dApps.

If you feel like trying WBTC for yourself, head over to a DEX like KyberSwap or AirSwap and experience just how easy it is to trade Bitcoin in the Ethereum DeFi ecosystem, you won’t be disappointed.

Twitter to invest in Bitcoin!?

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Jack Dorsey has been increasing his involvement with Bitcoin throughout 2018 and 2019. Original Source: https:https://bit.ly/2PLrEjH

Well, not exactly but Twitter’s CEO Jack Dorsey, who has been a fan of Bitcoin for some time recently announced that through Square, the popular payment app he founded, a Bitcoin research and development team will be funded. Dubbed Square Crypto, applications are open to all Bitcoin contributors and work can be sponsored remotely, allowing developers from all over the world the ability to work on Bitcoin full-time if selected. With many Bitcoin contributors being hobbyists who contribute out of goodwill - this development was one of the better pieces of news for Bitcoin developers this year.

Jack has also invested heavily into Lightning Labs, a Research and Development company headed by Elizabeth Stark. One of the teams most involved in Lightning, Jack has stated that Lighting on Cash App is “not a matter of if, but when”. Should this come to fruition millions of users would be exposed to Bitcoin and the Lighting Network. Now that's adoption!

What happened to Bitcoin Cash?

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Bitcoin Cash went through it’s own chain split shortly a year after splitting off from the Bitcoin chain. Original Source: https://bit.ly/2ZVTH4D

Splitting off the Bitcoin chain in August of 2017, the goal of Bitcoin Cash was to scale on-chain - as opposed to the 2nd layer developments being pursued by the majority of the Bitcoin community. Immediately increasing the block size to 8 megabytes, the on-chain transaction capacity was quadrupled right out of the gate, and a further increase to the current block size of 32 megabytes increased on-chain tps even further. It should be noted that this is not without consequence, as an ever increasing blockchains size bars many from being able to download full nodes. With most of Bitcoin Cash’s nodes running out of Alibaba or Amazon data centers, it is not hard to understand why many in the Bitcoin community have been critical of this scaling path.

In November of 2018 the BCH community was hit with its own chain split when a node implementation, calling itself SV, proposed that miners support their client as opposed to the previously supported developments. Created by the community, but finalized by Bitcoin ABC (a development team working on the BCH protocol), this led to what many dubbed the hash war and without getting caried away, it essentially cost a lot of money, contributed to a market panic and created 2 distinct coins, namely Bitcoin Cash and Bitcoin SV.

On a positive note, many of the perceived bad actors in BCH camp have been deemed by many to have left, and with their demons exorcized so to speak, collaboration with other blockchain projects and developers has increased since the hardfork.

So where’s Bitcoin going?

2018 was the year that Bitcoin developments such as Lightning and Liquid, after years of being in alpha or pre-release development, finally went live.

With improvements to scaling and usability, as well as integration into existing applications, Bitcoin may finally achieve some lasting and meaningful adoption outside of just being a hyper-speculative asset. Improvements to Lighting are also happening every day, and the peer-to-peer currency first envisioned by Satoshi in 2008 may just become what it set out to be. Time will tell, but if Bitcoin has taught us anything in its short history it’s that it is resilient. Stay positive and #BUIDL.


Coinaccord is a Canadian Blockchain Venture Studio that strives to create entirely new and decentralized models on a global scale. As a company run by humans, we want to know if we’ve made a mistake. Do we need to make a correction or do you have a different point of view on the topic? Let us know in our Medium comments.

We also do not own the rights to the images used above.