The 15-year-old cryptocurrency, bitcoin, has recently been showing promising signs of fulfilling its intended purpose as a means of payment. It has inspired the development of other crypto solutions in a new age of digital finance.
While bitcoin has served many functions, from a speculative investment to a hedge against inflation, it has struggled to establish a clear identity. Recently the quantity of bitcoin held on the lightning network, a payment protocol built on top of the blockchain, surged by 66% over the past year, reaching a record high of 5,580 coins.
Bitcoin usage on lighting network growing fast
Additionally, crypto payment experts have observed robust transaction volumes. BitPay, headquartered in the U.S., disclosed transaction volumes rising by 18% in 2022 relative to the previous year. Similarly, coinspaid noted a 32% increase in importance in the fourth quarter of 2022 compared to last year.
Crypto adoption and utility surges
There are increasing indications that bitcoin and other cryptocurrencies are evolving toward their original goal of becoming a widely used form of payment. Bitcoin’s recent surge in popularity may be due to its adoption by mainstream financial institutions, such as PayPal, Visa, and Mastercard, which began to facilitate bitcoin transactions.
Moreover, bitcoin’s underlying technology, blockchain, has matured significantly, enabling faster and more efficient transactions. As a result, bitcoin is becoming increasingly attractive to merchants as a means of accepting payments.
Despite its progress, bitcoin faces challenges toward mainstream adoption as a payment method, such as regulatory hurdles and scalability issues. Nonetheless, bitcoin’s recent developments suggest that its creator, Satoshi Nakamoto, would be proud of its progress.
Still relevant in the eyes of regulators?
Bitcoin and other cryptocurrencies remain a subject of interest and concern for regulators worldwide.
The relevance of BTC and crypto in the eyes of regulators depends on several factors, including their views on digital currencies as a viable alternative to traditional payment systems, their concerns about the risks associated with crypto, and their regulatory approach to the industry.
In recent years, many countries have taken steps to regulate the use and trading of cryptocurrencies. Some have implemented strict rules and guidelines for exchanges, while others have banned cryptocurrency transactions altogether.
Regulators have expressed concerns about money laundering, fraud, market manipulation, and investor protection. They have sought to address these risks through various measures, including stricter know-your-customer (KYC) and anti-money laundering (AML) requirements.
However, despite these concerns, many regulators recognize the potential benefits of cryptocurrencies and blockchain technology, including faster and more efficient payment systems, greater financial inclusion, and increased transparency.
As the industry evolves and matures, we will likely see further regulatory developments and initiatives to balance promoting innovation and ensuring consumer protection.