Some panic broke out last week when the Ordinals service for NFTs and the BRC-20 standard on the Bitcoin (BTC) network caused problems. The network suffered from sky-high transaction costs and transactions that were far from being confirmed, simply due to too much activity from the two aforementioned services. Lightning Labs may have found a solution: it wants to expand Bitcoin’s capabilities and even “bitcoinize” the US dollar.
Today we’re excited to announce the newest version of Taproot Assets 🥕, a scalable protocol to issue assets on #bitcoin and Lightning.
With this release, developers have the core set of features to bitcoinize the dollar in a chain-efficient manner! 💸⛓️https://t.co/7WmeDjNnM2
— Lightning Labs⚡️🍠 (@lightning) May 16, 2023
Competition for BRC-20
Lightning Labs is one of the developers of the Lightning Network, which should make Bitcoin more scalable. The infrastructure company has in a press release announced that it has found a better way to spend other assets on the network in the form of ‘Taproot Assets’.
This is essentially the same as Lightning Labs’ Taro project, but under a different name. Remarkably, Domo, the pseudonymous creator of BRC-20, favors Taproot Assets. At the introduction of BRC-20 he called Taro ‘obviously a better solution’. Even then, he expected BRC-20 coins to become worthless.
Taproot Assets must function ‘maximally off-chain’. This is to prevent the enormous crowds and congestion that the network has recently experienced, without compromising the permissionlessness of the network. So anyone can put assets on the network. An important part of this is that as soon as information is put on the blockchain, the transaction contains multiple assets. That increases efficiency.
Stablecoins on Bitcoin network
This makes it possible to ‘bitcoinize’ the dollar. This means that the US dollar can be put on Lightning Network in the form of stablecoins. Thus, dollar-denominated payments are literally made through bitcoin, rather than people moving dollars to buy bitcoin (BTC).
To achieve the latter, the final version is currently being worked on. Taproot Assets is currently in the testing phase (v0.2), but the mainnet should be launched sometime in the near future.
