Bitcoin’s Lightning Network (LN) might just be at a level whereby it can rub shoulders with Apple Pay, being only a few seconds slower than the centralized digital payment system.
This conclusion was arrived at after a Bitcoin analyst and supporter, JP Thor, researched into it. Thor began the research to compare both crypto and traditional payment systems in response to Anthony Pompliano’s challenge. Pompliano or “Pomp” as he is also known as on social media, requested that someone should conduct a time test to find out the amount of time needed to complete a credit card and an LN-enabled crypto transaction.
Speaking on the speed of the LN, Pompliano stated that he “wouldn’t be surprised if transactions go from [crypto] wallet to wallet [on the LN] faster than the time it takes for a credit card machine to process the chip on a card that gets inserted.”
Thor Accepts the Challenge
Thor went ahead to compare the time required to onboard the account of a new customer to a conventional mobile payment platform with the amount of time needed to conduct transfers using a crypto wallet that is enabled with the Lightning Network. It was observed that transactions based on the Lightning Network were much faster due to the absence of third-parties.
While explaining the transaction process, Thor noted that:
“Sending a payment across the LN will always be faster than Visa. LN payments can be processed as fast as a TCP/IP connection between two peers. A single channel has been shown to process over 250 TPS, so the network can scale to no real upper bound.”
However, in everyday scenarios, Apple Pay still tops the LN in terms of speed, being a “couple of seconds” faster when it comes to payment settlement. Thor’s research also proved that conventional payment processors favored customers more while the LN worked better for merchants due to its ease of set up.
“Wallet of Satoshi” Nears Traditional Digital Payments In Speed
Thor revealed that he used an Australia-based Mastercard debit card with Apple Pay for his comparison test which made it possible for him to complete the transaction process all in five minutes. The five minutes was used for account registration and receiving payment.
Also, Thor said that he transferred funds from a traditional bank account and received it within 1 minute in his Up app account.
Thor tried the same process with “Wallet of Satoshi,” an LN-enabled crypto wallet and was able to get the same result within 5 minutes as well.
We've just ticked over to 10,000 Lightning payments in total! Some interesting stats: the average transaction fee was 0.35 satoshis, or about $0.000018, and more than 8,000 of those transactions had 0 fees. Here's to 1 million payments! Watch the count at https://t.co/wkgczIe7og pic.twitter.com/346oY55kmO
— ⚡ Wallet of Satoshi (@walletofsatoshi) January 14, 2019
Thor noted that the Wallet of Satoshi (WoS) accounts also require KYC from users but only during the purchase of fiat money. The KYC validation on WoS takes place almost immediately.