Twitter Plans Bitcoin Tipping Service Through Lightning Network
Bitcoin’s Lightning Network made another stride in terms of mainstream recognition earlier this week as Twitter CEO Jack Dorsey tweeted that he had received tips in the form of small amounts of BTC, thanks to a revolutionary new app, also hinting that his company may integrate the Lightning Network straight into its platform in the near future.
Receive Tips for Tweets via Lightning Network
Twitter CEO Jack Dorsey has been a longtime fan and vocal proponent of bitcoin. In 2017 he made bitcoin purchases and sales available through his Square app, which he says already has a “huge network of buyers.” After being handed the “Lightning Network torch” only earlier this month, he has already decided to make the world’s most popular cryptocurrency an integrated part of Twitter.
Cool example of #BitcoinTwitter experimenting on the Lightning Network.
— jack (@jack) February 5, 2019
Dorsey plans to accomplish this by adding a button to “tip” tweets using the tippin.me app directly into Twitter, so users can send a nominal amount of BTC to authors of tweets they find to be particularly meritable. Funds are stored by tippin.me in a custodial wallet and can be withdrawn from the service at any time, so long as the recipient has opened a payment channel with tippin.me (or is otherwise part of the Lightning Network).
The idea of social media tipping has been around for quite some time, starting with Dogecoin (DOGE) tipping in Reddit. Other tipping-based coins like ReddCoin (RDD) came along, and nowadays there are several blockchain startups struggling to create entire social media platforms out of the idea of tipping worthy content, such as Mithril (MITH) and Kik (KIN).
As of yet, none of these ideas have been particularly successful, because they lack the mass membership base of social media giants which in large have been extremely cautious about directly endorsing usage of a cryptocurrency. With his integration of tippin.me, Dorsey plans to set Twitter apart from the rest, in a bold move to become the first major social media platform that is bitcoin-friendly.
— jack (@jack) February 20, 2019
What is the Lightning Network? An Overview
The Lightning Network (LN) is a “second layer scaling solution for bitcoin.” This means it allows users to perform bitcoin transactions off-chain, rendering them both cheaper and faster than on-chain transactions. LN uses a series of smart contracts where bitcoins are locked by participating parties to facilitate bitcoin transactions without users actually having to transact with the blockchain.
Basically, users are sending each other “IOUs” for various amounts of BTC with the totals all maintained on a balance sheet that does not interact with the blockchain. A user first opens a payment channel with another user (or node) and deposits an initial amount of BTC into the smart contract. They can close the payment channel if they want to move their funds to a non-Lightning address, which requires a settlement process and can cost a certain amount of BTC.
At its current beta level stage, LN is more or less only ready for use specifically by those who plan to do a lot of sending and receiving of BTC without the need for converting it to a fiat currency or another cryptocurrency. In the future, however, the process of setting up a payment channel will likely be simplified in order to include an expanded, truly global user base. For now, participation in the LN is still somewhat dangerous and highly experimental, and the chance exists that those running nodes or channels could lose their BTC.
Currently, there are about 6,500 LN nodes in operation contributing to a total network capacity of about 715 BTC. This may not seem like a lot, but it represents an exponential growth that has occurred over the last year. Recent developments have made the process of opening one’s own LN channel and starting a node much easier than before, while projects like tippin.me hold funds on behalf of users until they are ready to be transferred. In the future, as it becomes easier for the average user to maintain their own connection to the LN, users will not have to be reliant on 3rd party “custodial” solutions for the maintenance of their BTC kept on the network, but for the time being, an endorsement from Twitter is probably the best indicator of faith that could be given about a LN 3rd party solution.
Dorsey Talks BTC with Joe Rogan
On February 2nd, Dorsey appeared on the Joe Rogan Experience podcast to give his views on the current state of social media and some of its inner-workings. Toward the end of the conversation, he was asked about his views on bitcoin, which can currently be purchased from his tremendously popular Square app, a company of which he is also CEO.
We are quoting Dorsey’s statements about bitcoin in their (near) full entirety, as they are quite telling of his beliefs about bitcoin’s future role as an “internet currency.”
“I believe the internet will have a native currency… I don’t know if it’s bitcoin – I think it will… It was something that was born on the internet, developed on the internet, tested on the internet… It is of the internet. The reason we enabled the purchasing of bitcoin within the cash app is one, we wanted to learn about the technology, put ourselves out there and take some risk…
It made us uncomfortable. We had to really understand what was going on, and that was critical and important. And then the second thing, we would love to see something become a global currency. It enables more access. It allows us to serve more people. It allows us to move much faster around the world… We thought we were going to start with how you could use it transactionally, but we noticed that people were treating it more like an asset, like a virtual gold…
We wanted to make that easy — just the simplest way to buy and sell bitcoin. But we also knew that it had to come with a lot of education, it had to come with constraint… We really tried to take on the role of education and to have some very simple, healthy constraints that allowed people to consider what their actions are.”
When asked if he thought there was any “pushback” from companies over the increasing user adoption of bitcoin, he responded:
“Oh yeah… You just look at some of the major banks and their consideration around bitcoin. They all love blockchain because of the efficiencies it can create for their business and potentially new business lines…
I just look at this and think how do we embrace this technology, not react to it from a threat standpoint. What does it enable us to do, and where does our value shift? And that’s what we should be talking about right now: how our value shifts. There’s always really strong answers to that question, but if you’re not willing to answer the question in the first place, you will become irrelevant, because technology will continue to march on, and just make you irrelevant.
And it’s the people that are growing up with this technology… who are asking the tough questions to themselves that are going to super disruptive to their business… We gotta make ourselves uncomfortable and we gotta disrupt what we held sacred.. It’s a fascinating time in technology, because that’s what I think is one of the last big centralized, nationalized instruments: currency… If you think about the internet as a country, as a market, as a nation — it’s going to have its own currency.
What’s interesting about the internet as a nation is that it’s the whole world. So, the world gets one currency; gets one thing to communicate in. And to me that is just so freeing and so exciting.” – Jack Dorsey, CEO of Twitter
— jack (@jack) February 20, 2019
How to Receive BTC Tips on Twitter
Registering for the tippin.me Twitter tipping service is incredibly easy. Just sign up from their website using your Twitter account, and you will instantly be provided with your own LN tipping page, which can be linked to on your personal Twitter. Similar to a BTC address, a “tipping request” is a long string of characters that can be represented by a QR code which is used by the sending party to make a BTC tip.
Once a tip has been received, it cannot be cashed out until the receiving party has established a payment channel with tippin.me by connecting to their node (which is probably the most labor intensive aspect of the ordeal, though becoming less so all of the time). After this action has been performed, funds can be withdrawn at any time, and for a minimal fee. Unlike normal LN-based transactions, the tippin.me service assures that you do not have to online in order to receive LN-directed funds sent as a tip over Twitter.
For more information on how to get connected to the Lightning Network, you check here, and you can find a long list of LN-friendly apps, resources and websites here. For more details from the actual source of its development team, you can find the home page for the Lightning Network here.