While primarily viewed as a store of value, and considered by many as a fantastic savings technology, bitcoin has yet to reach mass adoption.
After all, what use is money if you can’t spend it? Historically, bitcoin has been difficult to spend due to the nature of the technology, but also due to the lack of support for people or businesses accepting bitcoin.
For bitcoin to be considered a medium of exchange, we need to be able to freely exchange bitcoin for goods and services; in other words, to use bitcoin to buy stuff.
You may have heard of the meme “stacking sats.” This is a common term among Bitcoiners who want to accumulate bitcoin for future gains.
Everyone needs to spend money on their day-to-day existence — to pay bills, to buy food, for leisure, etc.
They have announced that fees will be set at the minimum possible rate for buying bitcoin through their app.
At the recent Bitcoin 2022 conference, Cash App announced that it will be possible to auto-convert your paycheck into bitcoin for free.
In addition, it’s really easy to be paid in bitcoin for goods or services you provide.
Bitcoin transactions are recorded on a distributed, decentralized blockchain.
Transactions are batched into blocks which are processed approximately every 10 minutes, resulting in delays to seeing the transaction on the blockchain.
While transaction fees are relatively inexpensive for high value transactions, on-chain fees for smaller transactions can be a significant proportion of the amount transferred, but this does vary.
The Lightning Network is a Layer 2 protocol that sits on top of the Bitcoin network and allows for near-instantaneous settlement at virtually no cost.
Support for the Lightning Network is now built into almost all bitcoin wallets and even some exchanges, such as CoinCorner, Bitfinex and Kraken.
There now exist many solutions for merchants that allow for the receipt of bitcoin payments over the Lightning Network, which can then either be kept in bitcoin or, if volatility is a concern, exchanged immediately for fiat currency.
The last thing a consumer wants is to convert an amount of fiat for a mortgage payment three weeks in advance and have the relative value of the payment decrease due to price volatility.
Recently, Strike announced some ground-breaking partnerships with Shopify and point-of-sale device manufacturers, such as NCR, that will bring Lightning integration directly into many retailers in the U.S.
Using the Lightning Network, the retailer will be in a position to take bitcoin payments instantly and potentially save 3% or more in the process.
The funds transferred during the transaction will be immediately available to them and the issue of reversal of credit card payments is removed.
In addition, the frictionless transaction process is extremely rapid and is usually as simple as scanning a QR code.
One additional benefit for the consumer is the ability to be completely self-sovereign and self-banked.
There is still some work to do on improving the user experience of paying using bitcoin.
No need for apps, just a near field communication card allowing you to tap on a point-of-sale device to make a payment.
Payment by bitcoin virtually removes the fees and allows for instant cash settlement, but invariably, it requires the use of a bitcoin wallet, usually on your mobile device.
The Bolt Card fixes this.
You can configure the Bolt Card to use your CoinCorner GBP or euro account and it will convert the amount into bitcoin and transfer the payment using the Lightning Network, instantly resulting in no capital gains tax implications.
The Bolt Card is completely reusable and can also be configured as a gift card allowing you to load it with bitcoin to give to friends and family.
The simple act of tapping a physical card against a POS terminal exactly mimics the current contactless technology that most people are familiar with.
As well as being perfect for all bitcoin payments, the Bolt Card could have a major impact in underdeveloped countries where internet access or mobile phone ownership is problematic.
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Upon clicking the button to pay, your Lightning wallet is opened, and the amount made ready to pay.
Eventually, it is hoped that bitcoin will be reclassified as a currency, removing this burden, but until then, you need to be mindful of capital gains tax.
In the situation where you are using bitcoin to pay bills or buy stuff, the scenario would be that you would acquire the bitcoin you need for the week and spend that.
A new service , complete your information and pay using bitcoin.
There are now many ways to start spending your bitcoin, and many more places will start to accept it soon.
Until bitcoin is seen as a useful, frictionless method of payment, pre-coiners will struggle to understand Bitcoin and the benefits it brings.
As the Lightning Network is more widely adopted, it will pave the way for bitcoin to be used also as a unit of account and we should start to see things being priced in bitcoin, bits or satoshis.