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Bitcoin payment solutions: Options and Trends

Bitcoin for Business

Bitcoin payment solutions: Options and Trends

  • Looking for a Solution to Create a Store and Accept Both Traditional and Bitcoin Payments?
  • How Is Lightning Payment Adoption Progressing?
There are always trade-offs for each category of solution. For example, in the initial "trial phase," the suggested wallets are designed to be as simple as possible in terms of user interface, but they are hosted (custodial). This means that the app provider controls the funds. However, the ethos of Bitcoin encourages users to take full ownership of their funds (self-custody). In this case, it is recommended to upgrade to the next category as soon as the first sales are made—essentially, once it’s confirmed that you have customers willing to pay in Bitcoin.
One of Bitcoin’s key advantages is the ability to move funds at will, making it very easy to switch providers or components of your solution. Additionally, all apps and solutions are evolving rapidly on their own. For instance, consider Bitcoinize, which now provides a physical Point of Sale (POS) terminal that integrates with many applications on the market. This solution didn’t exist just a few months ago.

Looking for a Solution to Create a Store and Accept Both Traditional and Bitcoin Payments?

If you're starting from scratch—no store, no product management software, and no point-of-sale (POS) system—you have a couple of options:
  • Outsourcing: You can outsource the creation of a website with shopping options and then add Bitcoin payment capabilities alongside traditional in-store solutions.
  • Simple Solutions: Alternatively, you can use platforms like Accessing.app to do it yourself. Key benefits include:
    • Quickly and affordably setting up an online or physical store.
    • Suitable for seasonal businesses, events, restaurants, or retail shops.
    • Defining and managing products for both physical and online sales.
    • Fiat payment processing (e.g., euros, dollars) via your own Stripe account.
    • Bitcoin payment processing via your own Swiss Bitcoin Pay account.

How Is Lightning Payment Adoption Progressing?

While the Lightning Network offers superior efficiency and lower fees, its adoption is still in its early stages of development. Instead of focusing on the current limitations, it's worth remembering how historical infrastructure transformations unfolded:
  • When cars first appeared, there weren’t enough cars to justify building roads, and not enough roads to justify owning cars.
  • When electricity was introduced, there weren’t enough customers to justify building power grids, and not enough grids to attract customers.
New infrastructures succeed because they are more efficient, and early adopters join because they reap tangible benefits. Here are observations about the Lightning Network in 2024:
  • Ultra-fast Transactions: Transactions are quite often nearly instantaneous (<500ms) and have an extremely low failure rate.
  • Network Professionalization: Larger players are ensuring liquidity across the network, while individuals have largely stopped routing payments and now mostly run "edge nodes."
  • Improved User Experience: Mobile apps for individual users have significantly improved. Features like splicing, static Bolt12 invoices, and zero-confirmation payments (0-conf) are widely available, making interactions seamless. Interoperability issues (e.g., force-closes) are no longer major concerns.
  • Enhanced Node and Channel Management: Both individual and professional solutions have advanced. For example, BTCPay Server now supports numerous plugins for connecting with other providers (PSPs, on/off ramps, etc.). New infrastructure providers, such as LightSpark and Alby Hub, are also entering production.
  • Merchant Adoption Growth: Merchants like BitRefill are reporting an increase in Bitcoin payments among their active users, with a clear shift toward Bitcoin over Lightning. Additionally, Lightning's ultra-low fees make it the preferred choice for small payments (average of €32 per transaction).
Source: BTC Map
  • Network Metrics: The total number of channels and Bitcoin locked on Lightning remains stable, with approximately 20,000 nodes, 5,200 BTC, and 60,000 channels. However, this reflects only part of the network and indicates a shift in participation, with fewer individuals and more professionals involved.
  • Lightning as a Bridge Between Networks: The Lightning Network’s efficiency and availability have already positioned it as a bridge to other interconnected networks (e.g., FediMint, Liquid, etc.).
The Comeback of the Wallet
Bitcoin and the Lightning Network are helping to complete the digital wallet revolution. New web services now allow transactions without the need to create an account—your wallet becomes your identity! With protocols like Nostr Wallet Connect (NWC) and LN-URL-AUTH, wallets can seamlessly authenticate users and enable transactions without traditional accounts. Gone are the days of account fatigue for simple purchases or subscriptions. No more need to provide personal or payment information that could end up being hacked and for sale on the dark web, as we are reminded all too often by recent events.
The merchants of tomorrow will embrace this innovation, offering customers a safer, more seamless (one-click) experience that also respects their privacy.
Quiz
Quiz1/5
What trend is noted among participants operating nodes on the Lightning Network?