Hämta Tap-appen

QR-kod att skanna för nedladdning av Tap-appen

QR code to scan for downloading the Tap app
XTP is back soon: ProBit integration underway

Keep reading

We want to inform you that XTP trading will be temporarily paused starting today on the Tap app. We’ll be temporarily pausing XTP trading on the Tap app. This short pause will give us the time we need to complete the integration of ProBit, an exchange that continues to support XTP trading.

We sincerely apologise for any inconvenience caused by the Bitfinex delisting. XTP was removed alongside several other major tokens, and the short notice left limited time to implement an alternative solution. We moved quickly, and the integration with ProBit an exchange that supports XTP is already in progress.

Here’s what you need to know:

  • XTP trading will be paused for a few days
  • We’re integrating ProBit into our trading engine
  • Once that’s done, XTP trading will resume as usual in the app
  • We’re also in active talks with several other exchanges to expand access to XTP

We know how important XTP is to many of you, and it’s at the heart of the Tap ecosystem. Thank you for your patience and continued trust. We’ll keep you updated and let you know the moment trading goes live again.

The Tap Team

Find
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

NEWS AND UPDATES

Millennials and Gen Z: The Catalysts of the Money Revolution?

Millennials and Gen Z are revolutionizing the financial landscape, leveraging cryptocurrencies to challenge traditional systems and redefine money itself. Curious about how this shift affects your financial future? Let's uncover the powerful changes they’re driving!

Read more

The financial world is undergoing a significant transformation, largely driven by Millennials and Gen Z. These digital-native generations are embracing cryptocurrencies at an unprecedented rate, challenging traditional financial systems and catalysing a shift toward new forms of digital finance, redefining how we perceive and interact with money.

This movement is not just a fleeting trend but a fundamental change that is redefining how we perceive and interact with money.

Digital Natives Leading the Way

Growing up in the digital age, Millennials (born 1981-1996) and Gen Z (born 1997-2012) are inherently comfortable with technology. This familiarity extends to their financial behaviours, with a noticeable inclination toward adopting innovative solutions like cryptocurrencies and blockchain technology.

According to the Grayscale Investments and Harris Poll Report which studied Americans, 44% agree that “crypto and blockchain technology are the future of finance.” Looking more closely at the demographics, Millenials and Gen Z’s expressed the highest levels of enthusiasm, underscoring the pivotal role younger generations play in driving cryptocurrency adoption.

Desire for Financial Empowerment and Inclusion

Economic challenges such as the 2008 financial crisis and the impacts of the COVID-19 pandemic have shaped these generations' perspectives on traditional finance. There's a growing scepticism toward conventional financial institutions and a desire for greater control over personal finances.

The Grayscale-Harris Poll found that 23% of those surveyed believe that cryptocurrencies are a long-term investment, up from 19% the previous year. The report also found that 41% of participants are currently paying more attention to Bitcoin and other crypto assets because of geopolitical tensions, inflation, and a weakening US dollar (up from  34%). 

This sentiment fuels engagement with cryptocurrencies as viable investment assets and tools for financial empowerment.

Influence on Market Dynamics

The collective financial influence of Millennials and Gen Z is significant. Their active participation in cryptocurrency markets contributes to increased liquidity and shapes market trends. Social media platforms like Reddit, Twitter, and TikTok have become pivotal in disseminating information and investment strategies among these generations.

The rise of cryptocurrencies like Dogecoin and Shiba Inu demonstrates how younger investors leverage online communities to impact financial markets2. This phenomenon shows their ability to mobilise and drive market movements, challenging traditional investment paradigms.

Embracing Innovation and Technological Advancement

Cryptocurrencies represent more than just investment opportunities; they embody technological innovation that resonates with Millennials and Gen Z. Blockchain technology and digital assets are areas where these generations are not only users but also contributors.

A 2021 survey by Pew Research Center indicated that 31% of Americans aged 18-29 have invested in, traded, or used cryptocurrency, compared to just 8% of those aged 50-64. This significant disparity highlights the generational embrace of digital assets and the technologies underpinning them.

Impact on Traditional Financial Institutions

The shift toward cryptocurrencies is prompting traditional financial institutions to adapt. Banks, investment firms, and payment platforms are increasingly integrating crypto services to meet the evolving demands of younger clients.

Companies like PayPal and Square have expanded their cryptocurrency offerings, allowing users to buy, hold, and sell cryptocurrencies directly from their platforms. These developments signify the financial industry's recognition of the growing importance of cryptocurrencies.

Challenges and Considerations

While enthusiasm is high, challenges such as regulatory uncertainties, security concerns, and market volatility remain. However, Millennials and Gen Z appear willing to navigate these risks, drawn by the potential rewards and alignment with their values of innovation and financial autonomy.

In summary

Millennials and Gen Z are redefining the financial landscape, with their embrace of cryptocurrencies serving as a catalyst for broader change. This isn't just about alternative investments; it's a shift in how younger generations view financial systems and their place within them. Their drive for autonomy, transparency, and technological integration is pushing traditional institutions to innovate rapidly.

This generational influence extends beyond personal finance, potentially reshaping global economic structures. For industry players, from established banks to fintech startups, adapting to these changing preferences isn't just advantageous—it's essential for long-term viability.

As cryptocurrencies and blockchain technology mature, we're likely to see further transformations in how society interacts with money. Those who can navigate this evolving landscape, balancing innovation with stability, will be well-positioned for the future of finance. It's a complex shift, but one that offers exciting possibilities for a more inclusive and technologically advanced financial ecosystem. The financial world is changing, and it's the young guns who are calling the shots.

Terra, Celsius: The crypto crashes in 2022 explained

2022 was a rollercoaster for crypto investors. Explore the reasons behind the crashes of Terra and Celsius and what the future holds.

Read more

There is seldom a dull moment in the cryptosphere. In a matter of weeks, crypto winters can turn into bull runs, high-profile celebrities can send the price of a cryptocurrency to an all-time high and big networks can go from hero to bankruptcy. While we await the next bull run, let’s dissect some of the bigger moments of this year so far. 

In a matter of weeks, we saw two major cryptocurrencies drop significantly in value and later declare themselves bankrupt. Not only did these companies lose millions, but millions of investors lost immense amounts of money. 

As some media sources use these stories as an opportunity to spread FUD (fear, uncertainty and doubt) about the crypto industry, in this article we’ll look at what affected these particular networks. This is not the “norm” when it comes to investing in digital assets, these are cases of not doing enough thorough research. 

The Downfall of Terra

Terra is a blockchain platform that offered several cryptocurrencies (mostly stablecoins), most notably the stablecoin TerraUST (UST) and Terra (LUNA). LUNA tokens played an integral role in maintaining the price of the algorithmic stablecoins, incentivizing trading between LUNA and stablecoins should they need to increase or decrease a stablecoin's supply. 

In December 2021, following a token burn, LUNA entered the top 10 biggest cryptocurrencies by market cap trading at $75. LUNA’s success was tied to that of UST. In April, UST overtook Binance USD to become the third-largest stablecoin in the cryptocurrency market. The Anchor protocol of the Terra ecosystem, which offers returns as high as 20% APY, aided UST's rise.

In May of 2022, UST unpegged from its $1 position, sending LUNA into a tailspin losing 99.9% of its value in a matter of days. The coin’s market cap dipped from $41b to $6.6m. The demise of the platform led to $60 billion of investors’ money going down the drain. So, what went wrong?

After a large sell-off of UST in early May, the stablecoin began to depeg. This caused a further mass sell-off of the algorithmic cryptocurrency causing mass amounts of LUNA to be minted to maintain its price equilibrium. This sent LUNA's circulating supply sky-rocketing, in turn crashing the price of the once top ten coin. The circulating supply of LUNA went from around 345 million to 3.47 billion in a matter of days. 

As investors scrambled to try to liquidate their assets, the damage was already done. The Luna Foundation Guard (LFG) had been acquiring large quantities of Bitcoin as a safeguard against the UST stablecoin unpegging, however, this did not prove to help as the network's tokens had already entered what's known as a "death spiral".

The LFG and Do Kwon reported bought $3 billion worth of Bitcoin and stored it in reserves should they need to use them for an unpegging. When the time came they claimed to have sold around 80,000 BTC, causing havoc on the rest of the market. Following these actions, the Bitcoin price dipped below $30,000, and continued to do so.

After losing nearly 100% of its value, the Terra blockchain halted services and went into overdrive to try and rectify the situation. As large exchanges started delisting both coins one by one, Terra’s founder Do Kwon released a recovery plan. While this had an effect on the coin’s price, rising to $4.46, it soon ran its course sending LUNA’s price below $1 again. 

In a final attempt to rectify the situation, Do Kwon alongside co-founder Daniel Shin hard forked the Terra blockchain to create a new version, renaming the original blockchain Terra Classic. The platform then released a new coin, Luna 2.0, while the original LUNA coin was renamed LUNC. 

Reviewing the situation in hindsight, a Web3 investor and venture partner at Farmer Fund, Stuti Pandey said, “What the Luna ecosystem did was they had a very aggressive and optimistic monetary policy that pretty much worked when markets were going very well, but they had a very weak monetary policy for when we encounter bear markets.” 

Then Celsius Froze Over

In mid-June 2022, Celsius, a blockchain-based platform that specializes in crypto loans and borrowing, halted all withdrawals citing “extreme market conditions”. Following a month of turmoil, Celsius officially announced that it had filed for Chapter 11 bankruptcy in July. 

Just a year earlier, in June 2021, the platform’s native token CEL had reached its all-time high of $8.02 with a market cap of $1.9 billion. Following the platform’s upheaval, at the time of writing CEL was trading at $1.18 with a market cap of $281 million. 

According to court filings, when the platform filed for bankruptcy it was $1.2 billion in the red with $5.5 billion in liabilities, of which $4.7 billion is customer holdings. A far cry from its reign as one of the most successful DeFi (decentralized finance) platforms. What led to this demise?

Last year, the platform faced its first minor bump in the road when the US states of Texas, Alabama and New Jersey took legal action against the company for allegedly selling unregistered securities to users. 

Then, in April 2022, following pressure from regulators, Celsius also stopped providing interest-bearing accounts to non-accredited investors. While against the nature of DeFi, the company was left with little choice.  

Things then hit the fan in May of this year. The collapse of LUNA and UST caused significant damage to investor confidence across the entire cryptocurrency market. This is believed to have accelerated the start of a "crypto winter" and led to an industry-wide sell-off that produced a bank-run-style series of withdrawals by Celsius users. In bankruptcy documents, Celsius attributes its liquidity problems to the "domino effect" of LUNA's failure.

According to the company, Celsius had 1.7 million users and $11.7 billion worth of assets under management (AUM) and had made over $8 billion in loans alongside its very high APY (annual percentage yields) of 17%. 

These loans, however, came to a grinding halt when the platform froze all its clients' assets and announced a company-wide freeze on withdrawals in early June. 

Celsius released a statement stating: “Due to extreme market conditions, today we are announcing that Celsius is pausing all withdrawals, Swap, and transfers between accounts. We are taking this necessary action for the benefit of our entire community to stabilize liquidity and operations while we take steps to preserve and protect assets.”

Two weeks later the platform hired restructuring expert Alvarez & Marsal to assist with alleviating the damage caused by June’s uncertainty and the mounting liquidity issues. 

As of mid-July, after paying off several loans, Celsius filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York.

Final Thoughts

The biggest takeaway from these examples above it to always do your own research when it comes to investing in cryptocurrency or cryptocurrency platforms. Never chase “get-rich-quick” schemes, instead do your due diligence and read the fine print. If a platform is offering 20% APY, be sure to get to the bottom of how they intend to provide this. If there’s no transparency, there should be no investment. 

The cryptocurrency market has been faced with copious amounts of stressors in recent months, from the demise of these networks mentioned above (alongside others like Voyager and Three Anchor Capital) to a market-wide liquidity crunch, to the recent inflation rate increases around the globe. Not to mention the fearful anticipation of regulatory changes. 

If there’s one thing we know about cryptocurrencies it’s that the market as a whole is incredibly resilient. In recent weeks, prices of top cryptocurrencies like Bitcoin and Ethereum have slowly started to increase, causing speculation that we might finally be making our way out of the crypto winter. While this won’t be an overnight endeavour, the sentiment in the market remains hopeful. 

‍

What is a CBDC?

Unveiling the future of money: Explore the game-changing Central Bank Digital Currencies and their potential impact on finance.

Read more

Since the debut of Bitcoin in 2009, central banks have been living in fear of the disruptive technology that is cryptocurrency. Distributed ledger technology has revolutionized the digital world and has continued to challenge the corruption of central bank morals. 

Financial institutions can’t beat or control cryptocurrency, so they are joining them in creating digital currencies. Governments have now been embracing digital currencies in the form of CBDCs, otherwise known as central bank digital currencies. 

Central bank digital currencies are digital tokens, similar to cryptocurrency, issued by a central bank. They are pegged to the value of that country's fiat currency, acting as a digital currency version of the national currency. CBDCs are created and regulated by a country's central bank and monetary authorities.

A central bank digital currency is generally created for a sense of financial inclusion and to improve the application of monetary and fiscal policy. Central banks adopting currency in digital form presents great benefits for the federal reserve system as well as citizens, but there are some cons lurking behind the central bank digital currency facade.

Types of central bank digital currencies

While the concept of a central bank digital currency is quite easy to understand, there are layers to central bank money in its digital form. Before we take a deep dive into the possibilities presented by the central banks and their digital money, we will break down the different types of central bank digital currencies. 

Wholesale CBDCs

Wholesale central bank digital currencies are targeted at financial institutions, whereby reserve balances are held within a central bank. This integration assists the financial system and institutions in improving payment systems and security payment efficiency. 

This is much simpler than rolling out a central bank digital currency to the whole country but provides support for large businesses when they want to transfer money. These digital payments would also act as a digital ledger and aid in the avoidance of money laundering.

Retail CBDCs

A retail central bank digital currency refers to government-backed digital assets used between businesses and customers. This type of central bank digital currency is aimed at traditional currency, acting as a digital version of physical currency. These digital assets would allow retail payment systems, direct P2P CBDC transactions, as well as international settlements among businesses. It would be similar to having a bank account, where you could digitally transfer money through commercial banks, except the currency would be in the form of a digital yuan or euro, rather than the federal reserve of currency held by central banks.

Pros and cons of a central bank digital currency (CBDC)

Central banks are looking for ways to keep their money in the country, as opposed to it being spent on buying cryptocurrencies, thus losing it to a global market. As digital currencies become more popular, each central bank must decide whether they want to fight it or profit from the potential. Regardless of adoption, central banks creating their own digital currencies comes with benefits and disadvantages to users that you need to know. 

Pros of central bank digital currency (CBDC)

  • Cross border payments
  • Track money laundering activity 
  • Secure international monetary fund
  • Reduces risk of commercial bank collapse 
  • Cheaper
  • More secure
  • Promotes financial inclusion

Cons of central bank digital currency (CDBC)

  • Central banks have complete control
  • No anonymity of digital currency transfers
  • Cybersecurity issues 
  • Price reliant on fiat currency equivalent 
  • Physical money may be eliminated 
  • Ban of distributed ledger technology and cryptocurrency

Central bank digital currency conclusion

Central bank money in an electronic form has been a big debate in the blockchain technology space, with so many countries considering the possibility. The European Central Bank, as well as other central banks, have been considering the possibility of central bank digital currencies as a means of improving the financial system. The Chinese government is in the midst of testing out their e-CNY, which some are calling the digital yuan. They have seen great success so far, but only after completely banning Bitcoin trading.

There is a lot of good that can come from CBDCs, but the benefits are mostly for the federal reserve system and central banks. Bank-account holders and citizens may have their privacy compromised and their investment options limited if the world adopts CBDCs.

It's important to remember that central bank digital currencies are not cryptocurrencies. They do not compete with cryptocurrencies and the benefits of blockchain technology. Their limited use cases can only be applied when reinforced by a financial system authority. Only time will tell if CBDCs will succeed, but right now you can appreciate the advantages brought to you by crypto.

Understanding the crypto Travel Rule's role

You might have heard of the "Travel Rule" before, but do you know what it actually mean? Let us dive into it for you.

Read more

What is the "Travel Rule"?

You might have heard of the "Travel Rule" before, but do you know what it actually mean? Well, let me break it down for you. The Travel Rule, also known as FATF Recommendation 16, is a set of measures aimed at combating money laundering and terrorism financing through financial transactions.

So, why is it called the Travel Rule? It's because the personal data of the transacting parties "travels" with the transfers, making it easier for authorities to monitor and regulate these transactions. See, now it all makes sense!

The Travel Rule applies to financial institutions engaged in virtual asset transfers and crypto companies, collectively referred to as virtual asset service providers (VASPs). These VASPs have to obtain and share "required and accurate originator information and required beneficiary information" with counterparty VASPs or financial institutions during or before the transaction.

To make things more practical, the FATF recommends that countries adopt a de minimis threshold of 1,000 USD/EUR for virtual asset transfers. This means that transactions below this threshold would have fewer requirements compared to those exceeding it.

For transfers of Virtual Assets falling below the de minimis threshold, Virtual Asset Service Providers (VASPs) are required to gather:
  • The identities of the sender (originator) and receiver (beneficiary).
  • Either the wallet address associated with each transaction involving Virtual Assets (VAs) or a unique reference number assigned to the transaction.
  • Verification of this gathered data is not obligatory, unless any suspicious circumstances concerning money laundering or terrorism financing arise. In such instances, it becomes essential to verify customer information.
Conversely, for transfers surpassing the de minimis threshold, VASPs are obligated to collect more extensive particulars, encompassing:
  • Full name of the sender (originator).
  • The account number employed by the sender (originator) for processing the transaction, such as a wallet address.
  • The physical (geographical) address of the sender (originator), national identity number, a customer identification number that uniquely distinguishes the sender to the ordering institution, or details like date and place of birth.
  • Name of the receiver (beneficiary).
  • Account number of the receiver (beneficiary) utilized for transaction processing, similar to a wallet address.


By following these guidelines, virtual asset service providers can contribute to a safer and more transparent virtual asset ecosystem while complying with international regulations on anti-money laundering and countering the financing of terrorism. It's all about ensuring the integrity of financial transactions and safeguarding against illicit activities.

Implementation of the Travel Rule in the United Kingdom

A notable shift is anticipated in the United Kingdom's oversight of the virtual asset sector, commencing September 1, 2023.

This seminal development comes in the form of the Travel Rule, which falls under Part 7A of the Money Laundering Regulations 2017. Designed to combat money laundering and terrorist financing within the virtual asset industry, this new regulation expands the information-sharing requirements for wire transfers to encompass virtual asset transfers.

The HM Treasury of the UK has meticulously customized the provisions of the revised Wire Transfer Regulations to cater to the unique demands of the virtual asset sector. This underscores the government's unwavering commitment to fostering a secure and transparent financial ecosystem. Concurrently, it signals their resolve to enable the virtual asset industry to flourish.

The Travel Rule itself originates from the updated version of the Financial Action Task Force's recommendation on information-sharing requirements for wire transfers. By extending these recommendations to cover virtual asset transfers, the UK aspires to significantly mitigate the risk of illicit activities within the sector.

Undoubtedly, the Travel Rule heralds a landmark stride forward in regulating the virtual asset industry in the UK. By extending the ambit of information-sharing requirements and fortifying oversight over virtual asset firms‍

Implementation of the Travel Rule in the European Union‍

Prepare yourself, as a new regulation called the Travel Rule is set to be introduced in the world of virtual assets within the European Union. Effective from December 30, 2024, this rule will take effect precisely 18 months after the initial enforcement of the Transfer of Funds Regulation.

Let's delve into the details of the Travel Rule. When it comes to information requirements, there will be no distinction made between cross-border transfers and transfers within the EU. The revised Transfer of Funds regulation recognizes all virtual asset transfers as cross-border, acknowledging the borderless nature and global reach of such transactions and services.

Now, let's discuss compliance obligations. To ensure adherence to these regulations, European Crypto Asset Service Providers (CASPs) must comply with certain measures. For transactions exceeding 1,000 EUR with self-hosted wallets, CASPs are obligated to collect crucial originator and beneficiary information. Additionally, CASPs are required to fulfill additional wallet verification obligations.

The implementation of these measures within the European Union aims to enhance transparency and mitigate potential risks associated with virtual asset transfers. For individuals involved in this domain, it is of utmost importance to stay informed and adhere to these new guidelines in order to ensure compliance.

‍What does the travel rules means to me as user? ‍

As a user in the virtual asset industry, the implementation of the Travel Rule brings some significant changes that are designed to enhance the security and transparency of financial transactions. This means that when you engage in virtual asset transfers, certain personal information will now be shared between the involved parties. While this might sound intrusive at first, it plays a crucial role in combating fraud, money laundering, and terrorist financing.

The Travel Rule aims to create a safer environment for individuals like you by reducing the risks associated with illicit activities. This means that you can have greater confidence in the legitimacy of the virtual asset transactions you engage in. The regulation aims to weed out illicit activities and promote a level playing field for legitimate users. This fosters trust and confidence among users, attracting more participants and further driving the growth and development of the industry.

However, it's important to note that complying with this rule may require you to provide additional information to virtual asset service providers. Your privacy and the protection of your personal data remain paramount, and service providers are bound by strict regulations to ensure the security of your information.

In summary, the Travel Rule is a positive development for digital asset users like yourself, as it contributes to a more secure and trustworthy virtual asset industry.

‍Unlocking Compliance and Seamless Experiences: Tap's Proactive Approach to Upcoming Regulations‍

Tap is fully committed to upholding regulatory compliance, while also prioritizing a seamless and enjoyable customer experience. In order to achieve this delicate balance, Tap has proactively sought out partnerships with trusted solution providers and is actively engaged in industry working groups. By collaborating with experts in the field, Tap ensures it remains on the cutting edge of best practices and innovative solutions.

These efforts not only demonstrate Tap's dedication to compliance, but also contribute to creating a secure and transparent environment for its users. By staying ahead of the curve, Tap can foster trust and confidence in the cryptocurrency ecosystem, reassuring customers that their financial transactions are safe and protected.

But Tap's commitment to compliance doesn't mean sacrificing user experience. On the contrary, Tap understands the importance of providing a seamless journey for its customers. This means that while regulatory requirements may be changing, Tap is working diligently to ensure that users can continue to enjoy a smooth and hassle-free experience.

By combining a proactive approach to compliance with a determination to maintain user satisfaction, Tap is setting itself apart as a trusted leader in the financial technology industry.  So rest assured, as Tap evolves in response to new regulations, your experience as a customer will remain top-notch and worry-free.

‍

Millennials and Gen Z: The Catalysts of the Money Revolution?

Millennials and Gen Z are revolutionizing the financial landscape, leveraging cryptocurrencies to challenge traditional systems and redefine money itself. Curious about how this shift affects your financial future? Let's uncover the powerful changes they’re driving!

Read more
Terra, Celsius: The crypto crashes in 2022 explained

2022 was a rollercoaster for crypto investors. Explore the reasons behind the crashes of Terra and Celsius and what the future holds.

Read more
What is a CBDC?

Unveiling the future of money: Explore the game-changing Central Bank Digital Currencies and their potential impact on finance.

Read more
Understanding the crypto Travel Rule's role

You might have heard of the "Travel Rule" before, but do you know what it actually mean? Let us dive into it for you.

Read more
No items found.

LATEST ARTICLE

Crypto
Ash
What Is Curve (CRV) and how it drives DeFi markets
Read article

The Curve protocol and Curve DAO token form another innovative project to come from the DeFi movement and one that provides a particularly unique and well-designed concept. Improving on functionalities that DeFi platforms like Uniswap and Sushiswap have otherwise neglected, Curve focuses on providing a viable alternative solution to traditional financial platforms in the blockchain industry.  

The Curve Finance platform, launched in January 2020, later released a decentralised autonomous organisation (DAO) alongside the Curve DAO token eight months later. CRV functions as the in-house token of the platform.  

What Is Curve DAO (CRV)?

The Curve platform, formally known as Curve Finance, provides traders with a decentralised exchange on which to swap digital assets. Curve aims to provide minimum price slippage between two tradable crypto assets by focusing on stablecoins or assets of similar value. Through an automated market maker (AMM) and focused smart contracts, the decentralised exchange is able to manage liquidity.  

While the platform can be compared to Uniswap, in reality, it has some key differences and a much higher amount of locked liquidity. The platform and its liquidity providers are more focused on stablecoins and other coins of that nature. CRV tokens fuel the network and are a tradable asset for crypto users.

The Curve DAO provides more decentralised governance to Curve's trading platform. The Curve protocol has grown into a well-respected financial asset within the DeFi ecosystem with its strong DeFi protocol.

Who created the Curve protocol?

The Curve platform was created by a Russian scientist with ample experience in the crypto industry. Michael Egorov both founded the platform and acts as its CEO. He previously co-founded a crypto business focused on building privacy-oriented protocols and infrastructure, NuCypher, in 2015, as well as LoanCoin, a decentralised bank and loans network.

As of August 2020, Egorov holds 71% of the governance tokens after locking up a large amount of CRV tokens in response to yearn.finance’s increasing voting power in the Curve network. In a statement made later, Egorov admitted to “overreacting”.  

How does Curve work?

Launched prior to Uniswap V2, Curve Finance operates similarly to the DeFi platform but has implemented some key differences. The decentralised exchange differentiates itself from the original AMM platform by innovating the liquidity pool trading structure and relevant smart contracts.

The Curve DAO trading platform is managed by a mathematical function called a bonding curve, which is designed to let cryptocurrencies trade for the best possible price amongst each other. Bonding curves are also used by other DeFi trading platforms, like Uniswap.

Due to the Curve DAO platform being primarily focused on stablecoins, its bonding curve is specifically focused on these pegged digital currencies and is able to trade a larger amount of stablecoins with less change in their relative prices in a liquidity pool.

Lending pools

In order for the Curve DAO platform to operate, it requires a group of users who are willing to lock up their cryptocurrencies in order for them to be traded by others. The platform provides a return on their coins plus a portion of the fees from trades when incentivizing liquidity providers.

The platform manages the coins in the liquidity pools by making them more expensive or cheaper, based on their fluctuating amounts, thereby making them more attractive to buyers and sellers using the platform.

On Uniswap, liquidity pools are based strictly on predetermined trading pairs while on Curve DAO the liquidity pools comprise multiple assets. On Curve DAO, entire liquidity pools can also be used as an asset inside another liquidity pool.

How does a trader use the liquidity pools?

Once a trader adds liquidity to a specific pool, through stablecoins or other digital assets, the user will receive a token specific to that pool. 3pool is an example of one of the most popular liquidity pools on the Curve platform.  

While the platform is known to provide trading for stablecoins, it also supports mirrored assets such as renBTC and wBTC. These assets are both built on the Ethereum blockchain and track the price of Bitcoin in a typical derivatives fashion. Since the prices are close in value they can function in the same pool and be traded using the Curve DEX.

What is the Curve DAO token (CRV)?

The CRV token is the utility token and governance token of the Curve DAO platform, providing users with governance rights, an incentive structure for fee payments, as well as providing long-term rewards to liquidity providers. CRV tokens are awarded to users based on their liquidity commitment and length of ownership.  

The Curve DAO token was launched alongside the Curve DAO in August 2020. The maximum supply is 3.03 billion CRV tokens, with 62% of that being distributed to liquidity providers. The rest is allocated between employees (3%), and shareholders (30%), and a small percentage is kept for community reserves (5%). Employee and shareholder allocations work off of a two-year vesting schedule.  

At the time of writing, over 531 million CRV tokens are in circulation, roughly 16% of the total supply.  The market cap at the time was around $365 million, positioning the Curve DAO token network in the top 20 biggest platforms in the DeFi ecosystem.

How can I buy Curve DAO tokens?

If you’d like to buy Curve DAO tokens to include in your crypto portfolio, you can do so easily through the Tap mobile app. Providing a highly secure and equally simple crypto trading platform, users can buy CRV with British Pounds or Euros, or exchange tokens for other cryptocurrencies supported on the platform such as Bitcoin or Ethereum.  

Simply download the app, create an account and follow the steps to get verified through the KYC process. You will then have access to several wallets, and a much simpler crypto trading experience.  

Crypto
Ash
En guide för att undvika förvirring kring kryptotickers
Read article

Kryptobranschen kan ibland kännas som ett eget språk – men vi hjälper dig att reda ut vad tickers egentligen handlar om. Tickers introducerades redan på 1800-talet för att förenkla aktiehandel, genom att visa en förkortning av företagsnamnet istället för hela namnet. Samma princip används idag inom krypto. Här guidar vi dig genom hur du undviker förvirring kring kryptotickers.

Vad är en kryptoticker?

En kryptoticker är en förkortning som representerar en viss kryptovaluta på centraliserade och decentraliserade börser. Till exempel står BTC för Bitcoin och ETH för Ethereum.

Kan två kryptovalutor ha samma ticker?

Nej, eftersom flera kryptovalutor ofta listas och handlas på samma börs behöver varje enskild valuta en unik ticker. Ibland händer det dock att mindre projekt kopierar en känd ticker för att få uppmärksamhet – detta är ofta ett varningstecken på att något inte står rätt till.

För att förenkla det hela har vi delat upp tickers i olika kategorier: betalningsvalutor, stablecoins, meme-mynt, utvecklingsfokuserade plattformar och ett spelprojekt.

Betalningsfokuserade kryptovalutor

Sedan Bitcoin lanserades 2009 har många projekt försökt skapa förbättrade versioner av digitala pengar. Flera har till och med använt namnet "Bitcoin" i sina egna projekt – vilket lett till viss förvirring.

BTC – Bitcoin
Det första och största kryptovalutan. Bitcoin är fortfarande den mest spridda digitala valutan.

LTC – Litecoin
En lyckad "fork" av Bitcoin med snabbare och billigare transaktioner.

XRP – Ripple
En valuta som fokuserar på snabba och billiga gränsöverskridande transaktioner.

Stablecoins

Stablecoins är kopplade till traditionella fiatvalutor för att undvika den prisvolatilitet som krypto är känt för. Dessa används ofta inom DeFi-projekt.

USDC – USD Coin
Kopplad till amerikanska dollarn. Lanserades av Circle och Coinbase 2018.

USDT – Tether
Världens första stablecoin, lanserad 2014. Även denna är kopplad till USD.

Meme Coins

Sedan Dogecoin blev en snackis har många försökt rida på vågen – oftast med låg marknadsvärdering. Här fokuserar vi på de två största:

DOGE – Dogecoin
Det första meme-myntet, lanserat 2013 som en "fork" av Litecoin.

SHIB – Shiba Inu
Lanserad 2020 som ett bredare ekosystem jämfört med Dogecoin, med fler funktioner.

Utvecklingsfokuserade kryptovalutor

Flera projekt har följt i Ethereums fotspår genom att erbjuda plattformar för utveckling av dApps och smarta kontrakt. Här är några av de mest populära:

ETH – Ethereum
Den mest använda utvecklingsplattformen, lanserad 2015. Känd för sina smarta kontrakt och breda användningsområden.

ADA – Cardano
Grundad av en av Ethereums medskapare. Fokuserar på akademisk forskning och hållbar utveckling.

DOT – Polkadot
Möjliggör kommunikation mellan olika blockkedjor – s.k. interoperabilitet.

LINK – Chainlink
En orakellösning som kopplar smarta kontrakt till externa datakällor.

SOL – Solana
En snabb och billig plattform för dApps och smarta kontrakt. Ett alternativ till Ethereum.

Spelplattform

MANA – Decentraland
Decentralands inhemska valuta. Används i det virtuella speluniversumet och kan även handlas på externa börser.

Sammanfattning: Så undviker du tickerförvirring

Vi hoppas att den här guiden hjälper dig att känna dig mer hemma bland kryptotickers – särskilt om du är i startgroparna för din resa inom digitala tillgångar.

För dig som vill köpa, sälja eller lagra kryptovalutor på ett enkelt och säkert sätt erbjuder Tap en användarvänlig lösning. Alla valutor i appen visas med aktuell kurs, så att du kan ta kontroll över din kryptoupplevelse direkt från mobilen.

‍

Företag
Ash
Vad är Chainlink (LINK)?
Read article

I en rad nya kryptotillgångar som nu stöds i Tap-appen är Chainlink en av de senaste att listas. Plattformen har gjort sig känd som en av de största inom oracles – en teknik som möjliggör kommunikation mellan verklig data och blockchain-applikationer.

Men vad är Chainlink egentligen – och varför ska du bry dig i en värld där det redan finns många andra decentraliserade lösningar? Det handlar om att Chainlink löser ett avgörande problem som länge begränsat användningen av smarta kontrakt i verkliga affärssituationer.

Vad är Chainlink (LIN)?

Chainlink är ett decentraliserat oracle-nätverk som fungerar som en bro mellan verklig data och blockkedjeteknik. Målet? Att smarta kontrakt ska kunna använda verkliga data – som väder, valutakurser eller sportresultat – för att fungera automatiskt.

Smarta kontrakt är digitala avtal som automatiskt genomförs när vissa villkor är uppfyllda. Problemet? De kan inte "se" vad som händer utanför blockkedjan. Chainlink löser detta genom sitt nätverk av oracles – dataleverantörer som hämtar in information från verkliga källor och matar in den i blockkedjebaserade applikationer.

Dessa oracles belönas med Chainlinks egna token, LINK, och rankas utifrån pålitlighet och korrekt data, vilket gör systemet både smart och säkert.

Vem grundade Chainlink?

Chainlink har sitt ursprung i ett projekt från 2014 kallat SmartContract, grundat av Sergey Nazarov och Steve Ellis. De utvecklade en lösning för att koppla smarta kontrakt till verkliga datakällor och bankbetalningar.

Det första officiella Chainlink-nätverket lanserades 2017, efter en framgångsrik ICO som drog in 32 miljoner USD. Whitepapret – som lade grunden för tekniken – kom samma år, och projektet har sedan dess växt till en nyckelspelare inom blockchain.

Hur fungerar Chainlink?

Chainlink gör det möjligt för smarta kontrakt att använda extern data. Det fungerar ungefär så här:

  1. Oracle Selection
    Användaren skapar ett Service Level Agreement (SLA) som beskriver vilken typ av data som behövs. Plattformen parar ihop detta med oracles som kan leverera den efterfrågade informationen. LINK-tokens sätts in som säkerhet.
  2. Data Reporting
    Valda oracles hämtar in datan från externa källor, bearbetar den och skickar den tillbaka till det smarta kontraktet.
  3. Result Aggregation
    Chainlink-nätverket analyserar svaren och utvärderar datans noggrannhet. Resultatet matas sedan in i kontraktet, samtidigt som varje oracle får ett pålitlighetsbetyg.

Chainlink använder en Proof-of-Stake-modell för säkerhet, där oracles som stakar mer LINK prioriteras.

Vad är det som gör Chainlink unikt?

Chainlink låter blockchain-appar interagera med verkliga händelser – säkert och pålitligt. Det kan handla om att hämta in valutakurser, API-data, väderinformation eller banktransaktioner – i realtid.

Istället för att varje utvecklare behöver skapa egna datakällor för sina smarta kontrakt, erbjuder Chainlink en decentraliserad, flexibel lösning som kan användas direkt – utan extra integrationer eller avgifter.

Vad är LINK-tokenen?

LINK är den inbyggda kryptovalutan i Chainlink-nätverket och används för att:

  • Betala noder (oracles) för att hämta, verifiera och leverera data.
  • Staka i nätverket som säkerhet – högre stakade mängder ger prioritet.
  • Belöna pålitliga oracles och stimulera nätverkets tillväxt.

LINK är en ERC-20 token som fungerar på Ethereum-nätverket och är en av de mest använda utility-tokens i DeFi-sektorn.

Hur kan jag köpa Chainlink?

Vill du lägga till LINK i din portfölj? Det är enkelt i Tap-appen.

  • Handla LINK direkt med andra kryptovalutor eller fiat-valutor.
  • Använd debetkort eller kreditkort (Visa eller Mastercard) för att köpa LINK direkt i appen.
  • Lagra och hantera dina LINK-tokens säkert i den integrerade plånboken.

Redo att ta steget? Utforska Chainlink via Tap och få direkt tillgång till ett av kryptovärldens mest spännande projekt.

‍

Crypto
Ash
What is a crypto whitepaper ?
Read article

Cryptocurrency whitepapers are detailed documents that outline the project's intentions, products, and infrastructure. While there isn't a rule on what needs to be included, most projects aim to share as much information about how the project aims to succeed in the hopes of building investors' trust, and interest.

Some of the topics typically covered include a summary of the project's team, goals, products, features, and tokenomics. When researching a blockchain or cryptocurrency project, whitepapers are a very good place to start.

What is a whitepaper?

A typical cryptocurrency whitepaper is usually a report or guide that teaches its readers about a certain topic or problem. As an example, developers might make a whitepaper covering their software to inform users about what they are constructing and why.

In the crypto space, a whitepaper is released by a project and assists in outlining the technical guidelines and core features of the project. While many whitepapers focus on specific coins or tokens, they can also be concentrated around various types of projects, like decentralized finance (DeFi) platforms, for example.

Cryptocurrency whitepapers will typically consist of statistics and diagrams outlining the project's core date, as well as the governing structure of the project, the team involved in creating and leading it, and their roadmap (current and future development plans).

What value do crypto project whitepapers serve?

Despite not being worth a monetary value, whitepapers play an important role in the crypto space. While there are no official criteria for creating them, whitepapers are integral to investors, researchers, developers, and industry insiders.

A great place to start for anyone interested in a project is to read through the whitepaper. If you're considering investing, it's best to meticulously read through it again. Whitepapers often provide insights into the project's potential red flags and a means to monitor whether they are sticking to their forecasted timeline.

A number of blockchain projects that have crashed displayed subtle warning signs in their whitepaper, like promising a deliverable without providing any evidence on how it will be executed.

How does one make a cryptocurrency whitepaper?

There are no official rules or outlines that projects need to follow when creating a crypto whitepaper, each blockchain project may determine what is best for that individual situation. As mentioned earlier, these are often the first official documents outlining the project to potential investors, so thorough and informative content depicting the project's structure, goals, and roadmap is best included.

Whitepapers should always be neutral, and avoid persuasive language or making too many promises. This is essentially a "business plan" in the crypto sense released to investors or the public prior to launching.

What info is included whitepaper?

Objectives

Whitepapers are created by founders to provide a comprehensive overview of both the project and the goal. For instance, Bitcoin's whitepaper describes the project's core objective as "A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution."

While Ethereum's whitepaper describes its intention as "The intent of Ethereum is to create an alternative protocol for building decentralized applications."

In a good cryptocurrency whitepaper, the project will outline what specific problem it aims to solve, and how it will improve various aspects of people's lives. Be cautious of projects that promise the world but have little in the way of evidence to back these claims. In the ICO boom of 2017, thousands of projects overpromised and underdelivered (if they delivered at all).

Blockchain specifications

Whitepapers will typically include how the cryptocurrency will work and function in the greater crypto ecosystem. This might outline technical aspects like the consensus mechanism the blockchain will utilize and how the decentralized aspect of the network will function.

Tokenomics

Another core piece of information that should be included in a project's whitepaper is the tokenomics. This will include information on the token, how it will be allocated, whether will it participate in token burns, or any incentive mechanisms.

Roadmaps

Roadmaps (a project timeline)are not just useful to see how a project aims to deliver on its objectives, but also provide insights into whether the project can keep up with its promises. While missing a deadline isn't a deal breaker in the crypto space, being open and communicating why is important.

Readability

A well-articulated whitepaper will typically be written in a manner that anyone can understand them. However, its important for the new blockchain project to also include certain technical specifications to provide evidence of the project's competence. Anyone can write a whitepaper, it takes technical know-how to create a blockchain platform.

Tips for reading a cryptocurrency whitepaper

  • first and foremost, ALWAYS read a project's whitepaper before investing
  • read whitepapers with a pinch of salt, they must be neutral and not over-promise
  • Look into the team members and their experience in the crypto and blockchain realm
  • a great idea doesn't necessarily mean it will be used or adopted
  • look for technical explanations that showcase the project's understanding

Examples of crypto projects’ whitepapers

The Bitcoin whitepaper (2008)

The instigator of the entire cryptocurrency industry, Satoshi Nakamoto, an anonymous individual or group, published the Bitcoin whitepaper in 2008. The paper is called "Bitcoin: A Peer-to-Peer Electronic Cash System."

The whitepaper explains how Bitcoin can be used as a more efficient and decentralized form of money, outside the traditional banking model. It gives technical explanations of how the peer-to-peer Bitcoin network allows users to send digital currency without intermediaries. The whitepaper also outlines how the Bitcoin network is resistant to censorship and double-spending attacks.

The project launched two months later in January 2009.

The Ethereum whitepaper (2014)

While Bitcoin launched the crypto industry, Ethereum played a pivotal role in the development of the blockchain space. The Ethereum whitepaper was published in 2014 by a young developer named Vitalik Buterin and titled "Ethereum whitepaper: A Next Generation Smart Contract & Decentralized Application Platform."

In the Ethereum whitepaper, Vitalik outlines how the platform's intentions differ from Bitcoin's. The whitepaper outlined how the platform would allow developers to create and launch decentralized applications (now commonly known as dapps) and included technological solutions that backed these goals, such as the Ethereum Virtual Machine and smart contracts.

In conclusion

Crypto whitepapers are not legally regulated, meaning that anyone can write one. Although a cryptocurrency whitepaper should provide readers with an understanding of what the project plans to do and how, it's crucial, if you're interested in a particular project, to consider red flags and risks when reading through the document.

Crypto
James
How to get involved with DeFi protocols
Read article

Decentralized Finance, or DeFi, opens up a whole world of financial services for you, ranging from straightforward banking services to complex financial instruments similar to those used by hedge funds and investment bankers. But here’s the twist: it all operates with cryptocurrencies instead of traditional cash.

In DeFi, you can stake your cryptocurrency in what are called smart contracts, which essentially means locking up your funds to earn interest, known as Annual Percentage Yield (APY). As a token of appreciation for staking your funds and providing liquidity, DeFi projects grant you special project-specific tokens. These tokens aren’t just a thank-you note—they give you a say in the project’s future decisions and carry some speculative value too.

Before we get started, let us first address several terms you are likely to come across in this piece:

  • Financial institutions are your traditional banks
  • Centralized exchanges are crypto exchanges that are operated by a managing company
  • Decentralized exchanges are crypto exchanges that are not managed by one company and typically work in a peer-to-peer manner.
  • DeFi is decentralized finance and refers to the industry in which regular users can engage various financial services requiring only an internet connection.

How smart contracts work in the DeFi space

A smart contract is a digital agreement that automatically executes once the predetermined criteria have been met. These computer codes are facilitated by blockchain technology and rely on the blockchain that they are built on. 

At the moment, your bank account from financial institutions might give you the right to a certain amount of monthly interest at a fixed rate. The deal is reached through a formal application procedure - which can take many days - that is handled by a mix of people and software and is acknowledged in writing. Once successful, the bank account is opened and you have access to the services.

A smart contract, on the other hand, uses a programming language (e.g. Solidity on Ethereum) to map out the mathematical aspects of an agreement - how much interest is due when and where it should be paid - while the underlying Ethereum blockchain executes the contract for a fee, making it transparent and unchangeable.

The ups and downs of the DeFi ecosystem

owever, it’s not all smooth sailing. DeFi can offer higher returns than traditional banks, which is quite appealing, but it also comes with higher risks. For instance, if something goes wrong with a smart contract, or you lose access to your private keys, there’s no safety net to catch you.

To dip your toes into DeFi waters, you’ll need a digital wallet like MetaMask and some funds from a cryptocurrency exchange. Once you’re set up, you can participate in various DeFi activities like lending or staking, each with its own set of fees depending on the network you’re using.

Additionally to the higher returns, DeFi tokens have also seen a rise in value, with some entering the top 20 and top 10 biggest cryptocurrencies based on market cap.

Furthermore, the value of DeFi tokens has surged, with some climbing into the top ranks of cryptocurrencies by market cap. This growth indicates a strong interest and a robust market presence, which can be exciting for anyone involved in the space.

However, it's not all smooth sailing. DeFi comes with its own risks that you should be aware of. For instance, executing smart contracts can get pricey, especially during times of network congestion. If you're looking to cut down on fees, you might want to explore alternatives to popular platforms like Ethereum, which can be more cost-effective.

Also, not all smart contracts are built the same. Some may have vulnerabilities that could put your funds at risk if not properly managed or if an error in the contract execution occurs. This highlights the importance of being careful with where and how you invest your digital assets.

Moreover, the decentralized nature of these platforms means that you’re in full control—which sounds great until you realize there is no safety net. If you lose access to your private key or make a transaction mistake, there's no customer service line to call for a do-over.

Ensure you vet various DeFi protocols before engaging

In general, more established Defi protocols with a higher total value of assets secured within them (also referred to as Total Value Locked, TVL) are safer. This is due to the fact that their code has been more thoroughly audited and "battle-tested".

Newer platforms will typically offer higher APYs in order to entice investors and build up liquidity. While this may sound lucrative, always ensure that you've done your research in order to understand exactly how the protocol operates and who is behind the project. 

Here are a few things to look out for:

  • Has the protocol's code been professionally audited? 
  • How long has the project been live?
  • What is the platform's TLV? (The higher the better)

Finding your top Defi protocol

There are a number of "well-established" DeFi platforms that have proven reliable and trustworthy in recent years. While the risks are still prevalent, these are the most established options when looking to enter the DeFi space with the leading DeFi protocols.

Aave

Compound

Maker

Yearn Finance

How to use DeFi protocols (Get started in DeFi)

Jumping into the world of DeFi protocols can be quite an adventure. Here’s a simple guide on how to get started :

First, you'll need a digital wallet, and MetaMask is a popular choice. It's user-friendly and a common gateway for engaging with DeFi platforms.

Once you have your digital wallet, you'll need to move your cryptocurrencies into it. This is usually done through a transfer from a centralized exchange. For example, if you have a Tap wallet, you can transfer Ethereum (ETH) or other supported assets directly into your MetaMask wallet. Remember, DeFi protocols operate with cryptocurrencies, not traditional bank funds.

With your wallet set up and your funds in place, you can connect to any DeFi application that interests you. You can then engage with various features of the platform, such as depositing funds into a lending protocol. Keep in mind that actions like depositing, staking, unstaking, or withdrawing will typically involve network fees, which vary by blockchain.

That’s all there is to it! With these steps, you can start exploring the different functionalities and opportunities within DeFi at your own pace.

Understanding the risks associated with DeFi

While we've stressed that using tried and tested DeFi platforms provide a higher level of security, there are still risks associated with the DeFi space.

Below are some more steps you can do in order to secure your cryptocurrency assets and decrease the chance of losing your funds.

  • Consider insurance, look into options for insuring your assets to help mitigate potential losses.
  • Research the team behind the project, do your due diligence.
  • Familiarize yourself with the platform's operations and features. For instance, if a platform advertises a certain return rate, such as 10% APY, delve into how they achieve those figures.
  • Don’t commit more than you can afford to lose

Decentralized finance is one of the most innovative and promising areas in cryptocurrency. It is also a harsh environment, however, that demands some expertise before stepping in.

Before you place any funds into Defi protocols and become one of the many liquidity providers, ensure that you've fully vetted the project and considered the pros and cons of what it has to offer. Also ensure that you understand how the platform operates.

The DeFi space can be both lucrative and devastating, it is complex and requires a good amount of know-how. If you wish to get involved, take the time to really understand both the opportunities and the challenges it presents first. This way, you can engage with DeFi more cautiously and equipped with the necessary knowledge. And remember with Defi everything is at your own risk.
‍

Crypto
James
Understanding the Bitcoin lightning network
Read article

The Lightning Network is a second layer solution that enables Bitcoin users to make fast and cheap transactions without compromising on security. The layer two technology allows users to enjoy the benefits of both the Bitcoin and Lightning Network layers simultaneously. Learn more about the Lightning Network solution below.

The Bitcoin trilemma

In order to compete with other payment channels like Visa, the Bitcoin network must be able to process transactions much faster and at a fraction of the cost. However, this scaling cannot come at the expense of decentralization or security.

The "Bitcoin trilemma" is a term used to outline the conflict between these three principles, scaling, security, and decentralization. 

The aim of Bitcoin Cash, Bitcoin SV, and other forks was to increase the block size in order to make Bitcoin transactions faster and more affordable on-chain.

However, these attempts failed to produce an effective method to transact quickly and inexpensively on-chain while still maintaining Satoshi's design. Hence, the Bitcoin Lightning Network.

The lightning network payment channels solution

Is it possible for the Bitcoin network to have it both ways, to keep its original architecture while also functioning as a fast micropayments network? The answer is yes, and thanks to the advent of Lightning Network transactions, Bitcoin can be used for everyday transactions like paying for a cup of coffee.

The Lightning Network is a type of layer two solution that is compatible with the Bitcoin service. This off-chain solution was first conceptualized in 2015 by Joseph Poon and Thaddeus Dryja.

The Lightning Network works by removing the burden of micropayments from the Bitcoin blockchain and instead utilizes multiple payment channels, which are controlled via multi-signature (multi-sig) Lightning Network wallets.

Why the lightning network?

How quickly can the Bitcoin network process transactions? Bitcoin is presently capable of processing between 2 and 7 transactions per second.

Visa, the current payment channel that drives your debit and credit card transactions, handles 150 million transactions each day, that's 24,000 transactions per second.

In order to make Bitcoin a competitive service to Visa, the Lightning Network needs to be implemented. This channel ensures that micropayments are instantly and cost-effectively executed, and is able to process thousands to hundreds of thousands of transactions instantly. 

The core concepts of how the Lightning Network works.

So how does the Lightning Network work? This layer 2 solution works on top of the Bitcoin blockchain, allowing thousands of micropayments to be executed at one time. This lowers the costs and increases the transaction speed of the initial transaction. There are three core components of the Lightning Network: the nodes, channels, and invoices. 

Lightning Network Nodes

This software connects with other nodes in order to form a network that connects to the Lightning Network to facilitate the sending and receiving of Bitcoin. 

Lightning Network Channel

Users of the Lightning Network establish payment channels with one another so that they may conduct transactions off-chain, which can then be settled (closed) on the mainchain (on-chain).

Invoices

Invoices are QR codes that represent requests for Lightning Network payments on the Lightning Network. Invoices include all of the data necessary to complete a payment on the network, such as the payment amount, which blockchain the invoice is associated with, expiration date, payee pubkey, routing hints, and other information.

How to use the lightning network

In order to make use of the Bitcoin Lightning Network, you will need to open a compatible Lightning Network wallet. Once you have downloaded and signed up for the wallet, you will need to send funds. Simply locate the wallet address of the Lightning Network-enabled wallet and send the funds via your normal payment channel. Once the funds appear in your wallet, you can then send transactions via the Lightning Network to other enabled wallets.

Kickstart your financial journey

Ready to take the first step? Join forward-thinking traders and savvy money users. Unlock new possibilities and start your path to success today.

Get started