lightning

Check out the latest edition of Breez's monthly newsletter "Feel the Breez"

→ 🌬️ Misty Breez goes live
→ 🖥️ Lightning hits the browser
 → 🌴 A Flash in the Caribbean
 → 🥃 Goats, Beers & Bitcoin

Feel the Breez ⚡️ 🌊 | Misty Breez, WASM, and Goats!

bitcoin

Breez SDK - Nodeless | WASM, Lowered Minimum Send/Receive, and More ⚡️

No, you have to be online to initiate the payment and claim the swap.

Today, Breez released a big update to the Nodeless SDK ⚡️

Check out the release notes for more details: https://github.com/breez/breez-sdk-liquid/releases/tag/0.8.0

***

## 1. WASM support
Nodeless now supports WebAssembly, so apps can now add Bitcoin payments directly into browsers and node.js environments.

To make WASM happen, we’ve made major improvements across the SDK.

⚠️ *Warning: we’re about to go technical* ⚠️ 

WASM-Compatible SDK Core
We updated the 𝚜𝚍𝚔-𝚌𝚘𝚖𝚖𝚘𝚗 crate to work in WASM environments by:
→ Integrating a WASM-compatible gRPC client using 𝚝𝚘𝚗𝚒𝚌_𝚠𝚎𝚋_𝚠𝚊𝚜𝚖_𝚌𝚕𝚒𝚎𝚗𝚝
→ Implementing custom DNS resolution for WASM
→ Refactoring the internal REST client to remove non-WASM-compatible dependencies
→ Introducing a new 𝚜𝚍𝚔-𝚖𝚊𝚌𝚛𝚘𝚜 crate for shared macro support across platforms

New WASM-Specific Crate
We added a dedicated WASM interface using 𝚠𝚊𝚜𝚖-𝚋𝚒𝚗𝚍𝚐𝚎𝚗, with custom type and callback handling to provide a smooth developer experience.

Flexible SDK Customization
 The new 𝙻𝚒𝚚𝚞𝚒𝚍𝚂𝚍𝚔𝙱𝚞𝚒𝚕𝚍𝚎𝚛 makes it easy to configure SDK components:
 → Includes platform-specific filesystem abstractions
 → Supports persistent storage in both Web and Node.js environments

SQLite and Cache Handling
 Since traditional databases are challenging in WASM, we:
 → Use an adapted in-memory SQLite setup via 𝚛𝚞𝚜𝚚𝚕𝚒𝚝𝚎
 → Added a custom persistent watcher to handle state

Background Tasks & System Adaptations
We implemented WASM-friendly alternatives for:
 → Background task spawning
 → Interval management
 → Accessing system time

Alternative Blockchain Data Sources
 Electrum isn’t viable in-browser, so we:
 → Integrated support for 𝚆𝚊𝚝𝚎𝚛𝚏𝚊𝚕𝚕𝚜 as a lightweight blockchain data source

WASM-Ready Boltz Integration
 → We refactored the Boltz swap client to be fully compatible with WASM environments.

gRPC-Web Proxy Support
 All gRPC-based services (e.g., Breez Server and real-time sync):
 → Now support 𝚐𝚁𝙿𝙲-𝚆𝚎𝚋 proxies
 → Enabling full connectivity from browser environments

> Need more guidance on building Lightning payments on the web?
> Check out our WASM demo app.
> https://github.com/breez/wasm-example-app


## 2. Lower Minimum Send/Receive Amounts

We’ve significantly lowered the minimums for sending and receiving payments with the Breez SDK - Nodeless.

You can now:
> ➡️ Send from just 21 sats
> ⬅️ Receive from just 100 sats

## 3. Pay Fees with Non-Bitcoin Assets

Users can now pay fees without using Bitcoin — instead paying fees with other assets like USDT.

A smoother UX for your users — more flexibility for your app. 

***


Check out the latest update of Misty Breez:

⬇️ Minimum receive amount threshold lowered to 100 sats — and we're working on reducing the minimum send amount (coming soon).

🔨 Consolidated Lightning and BTC address receive options into a single screen, as well as fixing the localization issue for the default Lightning address.

👌 Improved the payment processing flow as well as fixing various bugs affecting users.

And, what's next?

🔜 Improving our support for devices without Google services — as well as reducing the minimum send amount mentioned above.

Release Notes: https://github.com/breez/misty-breez/releases/tag/v0.1.3-beta

New Release: Misty Breez Update ⚡️

Misty Breez: The simplest self-custodial app for bitcoin payments ⚡️

Glad you like it @k00b. We want folks to see the full capabilities of the SDK and bring Bitcoin payments to more apps around the globe! 


Breez has released a new app, Misty Breez, the simplest self-custodial app for bitcoin payments.

Read more about it on Bitcoin Magazine: https://bitcoinmagazine.com/news/breez-announces-launch-of-new-wallet-misty-breez

***
# 

[](https://miro.medium.com/v2/resize:fit:933/0*X35i2r3sN1pxkcrM)

[Carl Benz](https://en.wikipedia.org/wiki/Carl_Benz) was a great engineer, and the car he invented has indisputably and indelibly shaped the world we live in. The first model was patented in 1886, and it was pretty cool. He drove a few demo laps, sold a few at trade shows, and people were pretty impressed. But the invention was still perceived as a kind of toy — like a 19th-century Segway or hoverboard.

In 1889, Carl’s wife Bertha took their two sons and one of the 3rd-gen models on a drive from their home in Mannheim to her parents’ place in Pforzheim 104 km (c. 60 miles) away. Since there were no gas stations, she had to scrounge petroleum distillate from pharmacies along the way, and she didn’t like the way the brakes worked, so she had a cobbler attach some scraps of leather to the brake ~shoes~, inventing brake lining. Oh, and she reportedly hadn’t told Carl about any of this. She just sent him a telegram when they arrived. But he may have already heard by the time the telegram arrived because her practical demonstration caused such a buzz that it was all anybody was talking about. She was perhaps the first woman to perform a mic drop by telegram.

[](https://miro.medium.com/v2/resize:fit:853/0*JoH8z5EJInD7QZKp)

Sisters doin’ it for themselves. And her fit was absolute fire! (Image: [Manu Ferrón](https://pasionmundomotor.blogspot.com/2013/03/bertha-benz-la-mujer-mas-importante-de.html))

There are two lessons to be drawn from this. First, never mess with a woman named Bertha. Second, if you want people to grasp the revolutionary implications of a new technology, the best way is to show them with a live demonstration.

Thanks for the inspiration, Bertha. If we want the world to grasp the revolutionary implications of the Breez SDK, how it fulfills bitcoin’s promise by turning it into an everyday currency for everyday purchases, and how easily it can transform any app into a thriving bitcoin business, we ought to show them. So we are.

World, I’d like you to meet [Misty Breez](https://github.com/breez/misty-breez), our new reference app to showcase the power and simplicity of the Breez SDK.

# **Why Have We Built Misty Breez?**

## **To Demonstrate What You Can Do With the SDK**

The original Breez Lightning app runs a node on each mobile device. While kinda miraculous, this also comes with limitations: each device needs to carry a graph of the whole network locally, each device needs an indefinite number of [costly payment channels](https://blog.breez.technology/liquidity-on-lightning-moving-from-ux-to-economix-6e597d9e1abd), and the overall complexity means that the best possible UX is merely okay.

Misty Breez is built on the nodeless variant of the Breez SDK, which offers the best UX currently possible in terms of cost and ease of use for self-custodial Lightning (with the [trust profile of Liquid](https://help.blockstream.com/hc/en-us/articles/900001408623-How-does-Liquid-Bitcoin-L-BTC-work)). But how easy and economical is that exactly? How big is the difference?

To find out, you could read our [extensive documentation](https://sdk-doc-liquid.breez.technology/) and consult our coding samples. Dozens of partners already have and are building great things on that basis.

Or you could try it out for yourself. That’s the first reason we’ve built Misty Breez: to show developers exactly what the Breez SDK can do and how good the UX has become. Play with it. Explore new use cases. Debug with it. Rock out and let the app do the talking.

## **To Showcase UX and UI Best Practices**

Lightning is bitcoin, but it’s not a blockchain, at least not directly. Developers coming to Lightning from other corners of the crypto galaxy and mainstream app developers are going to run into objects they may never have seen before: Lightning addresses, invoices, preimages, nodes, routing fees, etc.

All of these peculiar species exist for good reasons, and combined they make a beautiful system, but they’re not exactly self-explanatory. Seeing them in action and how they fit together is perhaps the best way to learn how Lightning works as a payment network.

Perhaps more importantly, Misty Breez can show developers how to deal with such issues in the UX or even how to obfuscate them completely. For example, the SDK can handle offline payments, which have long been unfeasible in Lightning, using mobile notifications if they’re integrated seamlessly, giving users a very familiar-feeling experience. Raw utility can almost never overcome a weak UX (and we can all think of very popular apps with almost no utility but an addictively marvelous UX). So Misty Breez can also give devs new to Lightning a UX benchmark to meet or surpass.

## **To Give Devs a Head Start**

Some devs might not want to go the SDK route. Maybe they don’t want to add Lightning to their app because they don’t have an app yet, and instead they want to bootstrap their own Lightning app. Fair enough.

If you fall into this category, you can build the app of your dreams around Misty Breez and rebrand it accordingly. It’s [open source](https://github.com/breez/misty-breez). It’s yours to play with and customize!

# **Sound Like Fun? Wanna Play?**

Have we tempted you? Are you keen to see how easily users can set up a Lightning address, just like the built-in [roys@breez.fun](http://roys@breez.fun/)? Are you desperate to see Misty Breez float effortlessly between protocols, including Bolt11, Bolt12, LNURL-Pay, BIP353, Lightning address, and BTC address? Are you just dying to see how offline payments work with mobile notifications?

Then get in on the action. Misty Breez is the Lightning playground, it’s a blast, and there’s room for everyone. The early access release is available now on [Android](https://play.google.com/store/apps/details?id=com.breez.misty) and [iOS](https://testflight.apple.com/join/nEegHvBX).

Told you the best way is just to show you. Maybe we should’ve named the app Bertha instead of Misty?

🌊 #006 Feel the Breez - The Latest Updates at Breez ⚡️

Breez have announced ten new partners that have integrated bitcoin payments with the Breez SDK.

***

# 

![](https://miro.medium.com/v2/resize:fit:933/1*WmY9X-OHVP6JGQX1bhlCwA.jpeg)

We’ve told you that [bitcoin payments are here and expanding rapidly](https://breez.technology/report/), but did you ever wonder how we knew? It’s one thing to go out and do a bunch of research on an ongoing phenomenon, but it’s another to intuit what’s worth researching in the first place. You need a special perspective to detect a trend when it’s global and decentralized.

We have a special perspective. At Breez, we know that bitcoin payments are a big deal, we build tech to facilitate them, and prospective partners are practically kicking our door down. [It’s that momentum](https://blog.breez.technology/breez-has-been-building-momentum-and-were-just-getting-started-06cf97c272ab) we’ve been talking about. When inquiries about your SDK for bitcoin payments are coming as fast as you can answer them, it’s easy to infer that you are chilling on the tip of a very big iceberg.

This entirely new scale is also why we’re introducing a cohort of new partners at once. If we were to present each individually, we’d need to write a book each quarter. So instead, enjoy these brief profiles of the companies that have implemented the Breez SDK in the last several weeks. Note the breadth of verticals they represent: an AI company, payment apps, a collaboration app, trading apps, and tipping. These are businesses, not hobbies. They’re evidence that the bitcoin economy is self-sustaining and growing.

We’re proud of the SDK and proud of these new partners, and we can’t wait to grow with them.

# **Assetify**

**Bringing bitcoin to P2P lending with Assetify**

[](https://miro.medium.com/v2/resize:fit:933/0*Rob2MuMfonuFiS0K)

Crowdfunding is a great idea, but not everyone wants to exchange their money for an autograph or a celebrity dinner. Why not share an idea that needs funding and obtain decentralized loans from a community of users? Why not indeed, asked [Assetify](https://www.assetify.net/), where users can use their crypto as collateral to obtain and make loans to earn a return on their stack.

Assetify is using the Breez SDK to let their users move bitcoin to where it does the most good. This is exactly the kind of interaction where the bitcoin economy, boosted by Lightning and our SDK, excels beyond anything fiat can manage.

# **Cowbolt**

**Compensating and collaborating with colleagues and communities on Cowbolt**

[](https://miro.medium.com/v2/resize:fit:933/0*Uq6BLVkLod_Z7KmM)

Collaboration is built on communication and compensation. To do things together, teammates, colleagues, family members, and friends need to be able to share plans and results, and then to share costs and rewards. [Cowbolt](https://cowbolt.com/) brings these two functions together, combining private chats with peer-to-peer payments.

With the Breez SDK, the complexity of adding bitcoin payments was no longer an issue, so they could focus on perfecting the design and functionality of their iOS and Android apps as well as the browser extension, which just launched. Our collaboration with Cowbolt has been as easy as collaborating *in* Cowbolt.

# **DexTrade**

**A trading app to make AML-compliant swaps across chains**

[](https://miro.medium.com/v2/resize:fit:933/0*2jokhgQwE4ow8nkc)

If centralized exchanges are how crypto has reinvented banks, then decentralized, P2P coin exchanges are the bitcoin-friendly alternative. [DexTrade P2P](https://p2p.dextrade.com/) is just that: a decentralized way for users to exchange tokens across chains with trustless atomic swaps.

DexTrade P2P has integrated the Breez SDK to give their 15,000 (and growing) global users quicker, cheaper bitcoin payments. The SDK has improved their UX and led to more transactions.

# **Flash**

**A bitcoin payment app tailor made to help merchants get paid**

[](https://miro.medium.com/v2/resize:fit:933/0*6XCtTRgxF57NRtnx)

Ever more merchants are accepting bitcoin payments for their retail sales. For those holdouts who still fear that accepting bitcoin might be too complex, [Flash](https://paywithflash.com/) has launched a self-custodial bitcoin wallet tailored specifically to merchants’ needs.

The Breez SDK lets Flash users accept bitcoin and, crucially, USDT, so the prices the merchants quote are as stable as the greenback for any customer who prefers a stablecoin. Flash will soon enable offline payments, giving all their users access to the feature that has long been the holy grail of Lightning development.

# **Lightning Pay**

**A wallet to move your bitcoin from the Shire to Mordor**

[](https://miro.medium.com/v2/resize:fit:933/0*RqrN4TuipItzYpia)

While most bitcoin businesses are inherently global, it can still be nice to have a local presence that understands local needs, opportunities, and constraints. [Lightning Pay](https://lightningpay.nz/) is a global wallet with a local presence in New Zealand, home of great rugby, some of the world’s awesomest birds, hobbits, and passionate bitcoiners.

Using the Breez SDK has helped Lightning Pay grow their user base by 20% each month, and each month those users move a billion sats. When our partners grow, bitcoin adoption grows.

# **OpenAgents**

**An AI assistant meets a bitcoin wallet, decentralizing the market for AI services**

[](https://miro.medium.com/v2/resize:fit:933/0*QohDd76usLHXl2HE)

While the AI ventures that dominate the headlines — OpenAI, xAI, Anthropic — are themselves dominated by centralized big-tech funding, [OpenAgents](https://openagents.com/) is bitcoinizing AI by adding *actual* openness, decentralization, and inclusiveness to the biggest tech innovation since bitcoin itself. [Onyx](https://openagents.com/onyx), OpenAgents’ consumer app, is like a “personal JARVIS”: a voice-driven assistant designed to replace Alexa or Siri paired with a built-in self-custodial bitcoin wallet and Nostr integration. It connects to a decentralized marketplace where developers can build AI tools and get paid in bitcoin.

The payment infrastructure underlying OpenAgents’ decentralized marketplace is, of course, based on bitcoin and runs the Breez SDK. Building AI as a permissionless, borderless, trustless technology, like bitcoin, is the best guarantor for a free and decentralized future with AI-driven productivity and bitcoin-powered payments for everyone.

# **Satoshi App**

**Removing the boundaries between fiat and bitcoin**

[](https://miro.medium.com/v2/resize:fit:933/0*fNIcvv6f0vwhor2Y)

Most of us still use fiat for some purposes and bitcoin whenever possible, but doing so typically requires different apps with different constraints and different interfaces. [Satoshi App](https://satoshi.money/) combines both a custodial bank account for USD and BTC with a self-custodial Lightning wallet. It’s a beautiful instance of finding a problem people experience and solving it.

Since Satoshi App lets users pay over Lightning and Liquid, the Breez SDK was the right choice, as it moves seamlessly between the two.

# **Shakesco**

**The bitcoin wallet that does so much more**

[](https://miro.medium.com/v2/resize:fit:933/0*GBfQQX8uIMcpjrq2)

The term [*wallet* has always been a poor fit](https://blog.breez.technology/there-is-no-such-thing-as-a-lightning-wallet-dc9ac46d32) for what these apps do. In the case of [Shakesco](https://shakesco.com/), it’s woefully inadequate. Far more than just a place to store pocket money, Shakesco lets users buy and sell bitcoin and ethereum, make private payments, manage recurring payments, set up team payouts, and more. Shakesco is as far from a leather wallet as a chuckwagon is from the Millennium Falcon.

Decentralizing P2P financial services, as Shakesco does, is exactly in line with the bitcoin ethos, and it’s exactly the sort of purpose we built the Breez SDK to serve.

# **Tidebinder**

**Bitcoin payments for businesses of all sizes**

[](https://miro.medium.com/v2/resize:fit:933/0*rAgBZmbWuI7m2Foq)

What if you want a one-stop shop that can service a diverse range of businesses in different verticals? [Tidebinder](https://tidebinder.com/) provides self-custodied bitcoin wallets for SMBs, banks, and fintechs alike.

Tidebinder uses the Breez SDK, which shows that our Lightning infrastructure can work at any scale, just like Tidebinder’s end-user products. Your scale is their scale is our scale.

# **ZapZap**

**A tipping app for rewarding awesome creations (and silly things too)**

[](https://miro.medium.com/v2/resize:fit:933/0*Mf19GnwFM3MEYAuP)

Tipping is a vital component of the creator economy. It’s the practical reflection of the pay-what-you-think-it’s-worth ethos, and it’s [ZapZap](https://zap-zap.me/)’s specialty. ZapZap lets users “Tip people who say awesome things” on X, and it’s proudly “the silliest way to tip small amounts!” How silly? When asked about ZapZap’s most meaningful statistics and key performance indicators, they answered that the modal tip amounts are 69 and 420 sats. Never change, ZapZap.

Launched just a couple of months ago, ZapZap has already attracted thousands of users worldwide. They’re also planning on expanding their offering from tips on tweets and memes to a pay-per-media model, and the Breez SDK is as scalable as they are, if slightly less silly.

# **Got a Case of FOMO? Good. You Should.**

Are you running a company that could use a dose of bitcoin payments that you can implement in just a few days? Good. You sound like someone we’d like to team up with. You already found the solution. Now [get in touch](https://breez.technology/sdk/) for help in implementing it.

Breez Announce 10 New Partners To Add Lightning ⚡️

# Features and Bug fixes
* Add seed support to ConnectRequest
* Improve realtime sync and restore
* Update built packages to Uniffi 0.28

New Release:  Breez SDK - Nodeless 0.7.2 ⚡️

# New: Breez SDK - Nodeless Tutorial
Breez have released a [new tutorial](https://youtube.com/playlist?list=PLU5Dk7xLNHcQEzKPpjBJYqQRSpfQfFhml&si=gEgtEoF8U5N3EcYm) for developers looking to integrate the **Breez SDK - Nodeless** into **React Native & Expo** apps.

Antonio from Breez runs you through how to *connect to the SDK*, *interact with the SDK*, *send payments*, *receive payments*, and *list payments*.

If you're building with Flutter — here's the tutorial that @dangeross produced last year ([see post for more info](https://stacker.news/items/784896)).

Let us know what you think and how we can further help builders!

***

### Videos
* [Introduction](https://youtu.be/Tn00PKXMjUw?si=5y5eXApCCgWse7oL) 
* [Connect to the SDK](https://youtu.be/ZTqiIqnRcZo?si=IHX1z5VE93v1cws2)
* [Interacting with the SDK](https://youtu.be/37BkZSbc7HM?si=rR3tfa5Lx_SUV2ir)
* [Receiving Payments](https://youtu.be/_S37YNSoq38?si=LrEhH8v6eCempndt)
* [Listing Payments](https://youtu.be/cWkCj0bydVY?si=JN4jjm8o6gCGrISG)
* [Sending Payments](https://youtu.be/8eNwW_nKFtg?si=uhMxlW2_wSix3rUj)

###  References
* [Demo Repository](https://github.com/breez/liquid-sdk-rn-demo)
* [Breez SDK - Nodeless Repository](https://github.com/breez/breez-sdk-liquid)
* [Breez SDK - Nodeless Documentation](https://sdk-doc-liquid.breez.technology/)

If you're looking to learn more about the SDK, [send us a message](https://breez.technology/sdk/).

New Breez SDK - Nodeless: Workshop & Tutorial for React Native & Expo Apps ⚡️

deleted by author

Breez SDK - Nodeless: Flutter Workshop + Video Tutorial ⚡️

Hey @spraveenitpro - here's the react native tutorial.

https://youtube.com/playlist?list=PLU5Dk7xLNHcQEzKPpjBJYqQRSpfQfFhml&si=KuHTgY3v36GSHQgC

Here's @roy's latest piece on USDT on Lightning.

https://bitcoinmagazine.com/technical/usdt-on-lightning-the-good-the-bad-and-the-unknown

***

# USDT on Lightning: the Good, the Bad, and the Unknown

Everyone has heard the C̵h̵i̵n̵e̵s̵e̵ ̵p̵r̵o̵v̵e̵r̵b̵ British misquote: “[May you live in interesting times](https://quoteinvestigator.com/2015/12/18/live/),” and how it’s supposed to be a curse. It sounds deep, like a quote for edgelords over 80.

But have you ever considered the alternative? According to the [Anglo-Saxon Chronicle](https://thijsporck.com/2020/09/15/when-medieval-chroniclers-have-nothing-to-report-the-years-190-381-in-the-anglo-saxon-chronicle/), there were nearly two centuries where nothing much happened. [Vivian Mercier](https://en.wikipedia.org/wiki/Vivian_Mercier) famously called *Waiting for Godot* “a play in which nothing happens, twice.” But nothing happening 191 times? I’ll take interesting times any day.

And that’s exactly what we have now. [Tether](https://tether.to/en/), with their stablecoin [USDT](https://tether.io/news/tether-brings-usdt-to-bitcoins-lightning-network-ushering-in-a-new-era-of-unstoppable-technology/), is [coming to Lightning](https://lightning.engineering/posts/2025-01-30-Tether-on-Lightning/). We’ve been talking a lot recently about how [Lightning is the common language of the bitcoin economy](https://medium.com/breez-technology/lightning-is-the-common-language-of-the-bitcoin-economy-eb8515341c11) and how [bitcoin is a medium of exchange](https://medium.com/breez-technology/bitcoins-false-dichotomy-between-sov-and-moe-18e3f968a643) (and [it really is; read our report](https://breez.technology/report/)).

These two arguments now seem to be converging. Thanks to Lightning working as a common language, it makes bitcoin interoperable with a wide range of adjacent technologies, like USDT. And USDT is going to turbocharge bitcoin into new use cases, new markets, and new challenges on a scale that the Lightning ecosystem has yet to experience.

https://miro.medium.com/v2/resize:fit:1400/0*gkkcwh-AlNb8lsWv

Given the choice, I’d rather dive head first into the unknown than spend the afternoon on the couch. All the cool stuff is in the unknown. (Image: [pxhere](https://c.pxhere.com/photos/d9/f9/skydiving_jump_falling_parachuting_military_training_high_people-747005.jpg!d))

USDT on Lightning is terra incognita. Interesting times indeed. So let’s think about what it means for USDT to join Lightning and for Lightning to move USDT — the opportunities, the risks, and the wide open questions.

# **Taproot Assets 101**

Lightning was originally intended to increase the throughput of the bitcoin blockchain, so bitcoin was to be its only cargo. [Taproot Assets is a new protocol](https://lightning.engineering/posts/2024-07-23-taproot-assets-LN/) that allows fungible assets (e.g. stablecoins) to be transmitted over Lightning as hashed metadata piggybacking on the same infrastructure used to process bitcoin payments.

The way it works is pretty simple for anyone who understands Lightning. The recipient generates an invoice that pings edge nodes (i.e. the nodes connecting users to the broader network) for exchange rates between bitcoin and the asset in question — USDT in the current case. Once the user accepts an edge node’s exchange rate, they generate an invoice for the payment and send it to the payer. The payer sends the asset to the edge node on their own side, the edge node converts everything into a normal-looking bitcoin payment, the payment proceeds through routing nodes along the network as usual, the edge node on the recipient’s end converts the payment back into the original asset (USDT) and forwards it to the recipient.

https://miro.medium.com/v2/resize:fit:1338/0*ExFhrn-cMtv6_MhE

Alice is paying Bob. An indeterminate number of routing nodes can forward the payment between the edge nodes, but they only see BTC in transit.

Taproot Assets leverages the versatility of Lightning and bitcoin to let users transfer new kinds of assets over the network, using bitcoin as the universal medium of exchange. One corollary of all the nodes speaking Lightning is that any routing nodes between the edge nodes see only BTC in transit. Lightning tells them how to move BTC, and that’s all they’re doing as far as they know. Awesome.

But there’s more to it than just technical specs. USDT is, after all, a massive medium of exchange. [Tens of billions of USDT](https://usdt.tokenview.io/en/charts) value change hands every day spread across millions of payments. Its daily trading volumes are in the same ballpark as the Brazilian real and the Indian rupee. This is a big deal. So what does Lightning mean for USDT, and what does the addition of USDT mean for Lightning?

# **The Good**

## **… for Bitcoin**

So far, much of the strategy for bitcoinizing commerce has focused on orange pilling as many people as possible and growing [the circular economy](https://thebitcoinmanual.com/articles/btc-circular-economies/) one user at a time. This strategy has perhaps reached the [limits of its scale](https://medium.com/breez-technology/orange-pilling-has-stopped-working-4a407252c7a3). The circle has grown massively in the last decade and a half, but it’s still limited, and we need to think in terms of millions at a time.

Now that USDT and BTC are natively interoperable on Lightning, the circle has gained tangents. With USDT on Lightning, each party to a payment — the payer and the recipient — can choose whether to use BTC or USDT on their own end, and neither depends on the other’s decision. A customer can pay in BTC, and the merchant can receive USDT. Or the customer can pay in USDT, and the merchant can receive BTC. Or they can both use the same asset. *It doesn’t matter*. Once both assets are native to Lightning, they become automatically, frictionlessly interchangeable. Everyone is free to opt for bitcoin’s advantages as a medium of exchange grown from the bottom up by the users or for USDT’s advantages as an asset whose price is as stable as US monetary policy and Tether’s liquid reserves.

Lightning and, by extension, bitcoin stand to gain [millions of users](https://tether.io/news/how-many-usdt-users-are-there/) and billions of dollars worth of spending power. It’s a qualitative extension of bitcoin’s utility. The new use cases will do more good for bitcoin than a boatload of orange pills. It’s also potentially a quantitative explosion for Lightning. Many of those new users might not even know that they’re using Lightning thanks to its efficacy as the [common language of the bitcoin economy](https://medium.com/breez-technology/lightning-is-the-common-language-of-the-bitcoin-economy-eb8515341c11). But we ol’ school Lightning vets know. This is what we’ve been building towards.

https://miro.medium.com/v2/resize:fit:1400/0*_Tc5m-oT91MueHc_

A circle is a beautiful thing, but a circle with innumerable tangents reaching out is breathtaking. (Image: [Todd Quackenbush](https://unsplash.com/photos/time-lapse-photography-of-led-waters-eStCg6FRw_E?utm_content=creditShareLink&utm_medium=referral&utm_source=unsplash))

Further, USDT integration could make Lightning easier for American users to access. American tax regulation [treats BTC like an equity](https://www.nerdwallet.com/article/investing/crypto-tax-rate), making each payment a potentially complex concatenation of tax events. But if US users can access Lightning with an asset that never incurs capital gains, then they’ll have access to many of Lightning’s advantages without one of its particular regulatory drawbacks.

## **…for Tether**

Tether typically issues USDT on proven blockchains that have achieved significant market traction, and they have [no interest in launching their own](https://www.msn.com/en-us/money/other/tether-ceo-paolo-ardoino-denies-rumors-of-launching-a-blockchain/ar-AA1yxxCg). USDT is [currently available on](https://tether.to/en/faqs/) Algorand, Celo, Cosmos, Ethereum, EOS, Liquid Network, Solana, Tezos, Ton, and Tron. Note that these are all proof-of-stake (PoS) blockchains (except Liquid, which uses a federation), so they’re necessarily more centralized than bitcoin.

These blockchains also face different tradeoffs. Ethereum is relatively decentralized for a PoS blockchain, but its [transaction fees are notoriously high](https://nowpayments.io/blog/ethereum-transaction-fees-are-too-high-what-should-i-do). Tron is cheaper. Perhaps that’s why, [according to one estimate](https://okhlopkov.com/usdt-popularity-across-different-blockchains/), nearly 7x more monthly active retail USDT users opt for Tron over Ethereum and send 8x more retail volume over Tron. But [Tron is notoriously centralized](https://www.financemagnates.com/cryptocurrency/news/tron-is-a-highly-centralized-project-ex-cto-says/), making it a choke point for USDT. If Tron were to fail, Tether would lose something like half of its total capacity across all blockchains. Ouch. By allowing USDT to be transacted over Lightning, which is inherently decentralized, Tether mitigates their dependency on cheap, centralized blockchains.

And just as USDT can facilitate American access to Lightning, Lightning could make USDT much more convenient to use in the US market. US exchanges sometimes limit USDT transactions to certain blockchains. For example, [Coinbase says](https://www.coinbase.com/en-de/price/tether) “Coinbase only supports USDT on the Ethereum blockchain (ERC-20). Do not send USDT on any other blockchain to Coinbase.” Lightning gives big exchanges like Binance, Coinbase, and Kraken (which already support Lightning today) a decentralized alternative for USDT payments to offer their users.

# **The Bad**

The new American administration has mooted onshoring the entire stablecoin industry and suggested that regulating it is their “[first priority](https://www.nbcchicago.com/news/business/money-report/white-house-crypto-czar-david-sacks-says-first-priority-is-stablecoin-legislation/3665689/).” In other words, they’ll be paying very close attention to every development. As long as stablecoins like USDT are pegged to the dollar, those who control the dollar and profit from it will want to control the stablecoins too.

Regulators think they can even improve on freedom by regulating it. They can’t help it. It’s in their nature. But it follows that, as USDT gains utility on Lightning and Lightning gains utility as a means to move USDT, we’re all going to be attracting greater scrutiny from regulators. It’s hard to say how much they’ll actually be able to do or what they’re going to try, but it won’t be any fun. Regulation is always friction.

One area that’s likely to attract regulatory scrutiny is the edge nodes. Conventional centralized exchanges tend to be subject to KYC/AML rules in many jurisdictions. If the edge nodes will be automatically exchanging USDT and BTC and forwarding payments, they might also look a lot like conventional exchanges to [regulators, who tend not to like decentralization](https://medium.com/breez-technology/why-bitcoin-needs-to-become-a-medium-of-exchange-80d5c9e1de65). 🙄

# **The Unknown**

## **What’s It Cost? What’s It Worth?**

While Lightning does offer users and USDT some significant benefits, it’s not obviously the best all-around solution for every payment involving USDT. Lightning users expect low fees. So do USDT users who use centralized blockchains and custodial exchanges. But adding a second asset to Lightning adds some financial considerations that everyone — routing nodes, users, and especially edge nodes — will have to reckon with.

First, the edge nodes are providing the typical services of LSPs — keeping users connected to the network with enough channels and enough liquidity to keep those payments moving — *in addition* to converting between assets. That conversion is a valuable service that deserves compensation, and it can also be risky (see below).

Second, USDT is likely to increase transaction volume considerably, which means that LSPs and routing nodes will have to keep more liquidity on the network to forward those payments. They don’t take the same shortcut as custodial exchanges, which just have to update their internal ledgers. The [economics of liquidity allocation](https://medium.com/breez-technology/lightning-economics-how-i-learned-to-stop-worrying-and-love-inbound-liquidity-511d05aa8b8b) still apply, only more so.

Will Lightning be able to compete with centralized exchanges like Tron for USDT payments? The answer will probably resemble the answer to most questions about matching technologies with use cases: each technology will have certain strengths and weaknesses that recommend it for certain use cases and not others. As usual, the market will figure it out. However, since the technology wasn’t tailored to this particular use case, price discovery will be a process of trial and error, which takes time.

## **Free Call Options? Uh oh.**

Edge nodes face the risk of the “[free-call-option problem](https://diyhpl.us/~bryan/irc/bitcoin/bitcoin-dev/linuxfoundation-pipermail/lightning-dev/2018-December/001752.txt),” which is interesting enough to merit its own discussion here. This is a new risk, and it’s inherent to any situation involving two assets in a single Lightning payment.

Lightning payments need to be completed within a certain time in order to be settled, or the invoice cancels automatically. That time is the “T” in [HTLCs](https://www.voltage.cloud/blog/how-do-htlc-work-lightning-network) — hashed, time-locked contracts.

When the edge nodes bid with their exchange rates for a USDT↔BTC payment, they calculate their bids based on parameters like their current liquidity situation *and the spot price*. But the users have a window between accepting the edge node’s bid and the expiration of the HTLC in which to settle the payment. Prices can move in that window. If I initiate a USDT payment at one rate, then I can wait until the rate moves in my favor before I release the preimage to settle it. If the rate moves against me, I simply don’t release the preimage. In that case, the edge node might initiate a channel closure to redeem their funds, but that’s a slow (and therefore costly) process. If it moves in my favor, the edge node is on the hook for the difference. Heads, I lose nothing. Tails, I fleece the edge node.

Payments involving any combination of assets on Lightning give the user a [call option](https://www.investopedia.com/terms/c/calloption.asp). Traditional financial institutions manage their downside risk in selling call options by adding the risk to the price. These options can get very expensive for unprepared edge nodes. [Just ask Kilian and Michael at Boltz](https://medium.com/boltzhq/the-problem-with-free-options-69f9f59a2d48), who originally brought this whole issue to my attention and had the class to describe it for all of us in the ecosystem. The alternative is for the edge nodes to price the call option into their quotes, just like traditional financial institutions. Intertemporal arbitrage is great work if you can get it.

https://miro.medium.com/v2/resize:fit:1400/0*un_UZ3oV2jyR105Z

How many early Lightning devs and budding LSPs expected that they’d have to worry about hedging built-in call options in 2025? (Image: [Nick Chong](https://unsplash.com/photos/black-flat-screen-computer-monitor-N__BnvQ_w18?utm_content=creditShareLink&utm_medium=referral&utm_source=unsplash))

Users aren’t the only source of concern for edge nodes either. If a routing node fails to forward the preimage — whether through intent or malfunction — the edge node could still be on the hook. At least with routing nodes, it might be possible to implement some form of reputation system to help choose the route. However, a reputation system for end users might not be feasible as new users will be constantly joining the network.

The free call options have never been a problem for Lightning until now because the network has only dealt with a single asset: bitcoin. If the free-option problem became serious enough, one could imagine multiple parallel, single-currency Lightning Networks emerging. One for bitcoin. One for USDT. Another for … If bitcoin gets cut out of the loop, we will lose the benefit of bitcoin interoperability. We might even wind up regretting bringing USDT onto Lightning in the first place.

# **We’re in It for the Interesting Times**

Bitcoin was always meant to be revolutionary. Disrupting broken fiat is the whole point and always has been. We’re in it for the revolution. We know that change and disruption was never going to be a smooth process.

But change is a good thing. Progress is just a kind of change that people welcome. We welcome USDT on Lightning because we see the opportunity. It can represent progress for USDT users, for Lightning, and for bitcoin.

Like any change, though, it’s going to require careful thought, preparation, sharp instincts, and quick reactions. You don’t go into uncharted territory without the right gear and a few skills. Anyone in the Lightning liquidity business is going to face some new challenges, but also stands to make some big gains.

Tether stands to gain an economical, decentralized distribution network and better access to the vital US market. Lightning stands to gain a massive infusion of liquidity and users. Bitcoin will be natively interoperable with USDT. That’s why there’s so much excitement.

But regulators are watching. And edge nodes will only offer the indispensable conversion services if doing so is profitable, not ruinous. So let’s approach this change as we do all new developments in Lightning: by thinking hard, designing carefully, hardening our code, preparing the market, and never losing sight of our ultimate goal, which is to realize the universal bitcoin economy.

***

USDT on Lightning: the Good, the Bad, and the Unknown ⚡️ - Roy Sheinfeld, Breez

bitcoin_beginners

Are bitcoins meant for spending or savings?

expatriotic

Recommend this article from @roy on bitcoin's false dichotomy between SoV and MoE: https://stacker.news/items/726256

And at Breez, we just released this report that dives into this subject too: https://x.com/Breez_Tech/status/1887518233432822182

For more details on our latest release check out the notes here: 
https://github.com/breez/breez-sdk-liquid/releases/tag/0.7.1

***

# Breez SDK - Nodeless 0.7.1

## Features and Bug Fixes
* Support [multiple Liquid assets](https://sdk-doc-liquid.breez.technology/guide/assets.html) with built in support for USDT
* Faster payments & instant SDK initialization
* [Drain all funds](https://sdk-doc-liquid.breez.technology/guide/lnurl_pay.html#draining-all-funds) is now also available via LNURL-Pay
* Automatically remove replaceable push notifications
* Add an event for refundable swaps
* Real-time sync optimizations
* Support [regtest](https://github.com/breez/breez-sdk-liquid/tree/main/regtest)
* Added a seed passphrase option to ConnectRequest

You can learn more about the nodeless implementation [here](https://github.com/breez/breez-sdk-liquid
).

New Release: Breez SDK - Nodeless 0.7.1

🌊 #005 Feel the Breez

Bitcoin Payments: From Digital Gold to Everyday Currency

hey @k00b - we're looking to expand it for the next version, as it is not exhaustive. Will make sure to have SN on there! Thanks for the support ⚡️

Bitcoin isn’t just "digital gold" — it’s an everyday currency reaching millions around the world.

In our new report, Bitcoin Payments: From Digital Gold to Everyday Currency, Breez and 1A1z explore how bitcoin payments are transforming how people move money across industries, geographies, and use cases. The ecosystem is growing fast, already reaching over 650 million people, showing that bitcoin payments aren’t a thing of the future — they’re already here.

You can read the full report on our website: https://breez.technology/report/

Breez has raised $5M to bring bitcoin payments to every app ⚡️

you can keep up-to-date with developments here: https://github.com/breez/breez-sdk-liquid