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270 sats \ 2 replies \ @monk_cactus 17 Feb 2023 \ on: I'm an LN maxi. Are we on the cusp of major network effect? (sats for replies) bitcoin
I'm more or less with you.
I don't really think "DeFi" has a future on lightning, but I don't have a great argument because it's kinda over my head. It seems clear to me that lightning is a payment network by design, so I end wondering why it would be a place for DeFi.
It might be that I just have huge blind spot around DeFi. Like what is it? Essentially leveraged trading?
If you're trading real assets like securities, it's inherently permissioned. So you don't need lightning nor a blockchain. If you're extending credit, you're trusting the issuer, so again, why lightning or bitcoin?
But I def agree that the future of lightning seems very bright at the moment. How can you compete with it in terms of web based micropayments or cross border payments. It's a slam dunk
The DeFi (decentralized finance) I mention isn't going to be built directly on the blockchain or the LN overlay network per se, although projects like the incoming TARO will probably bring such things.
I'm thinking that the LN can simply be piped directly into any business, from the lemonade stand to the lithium miner, anywhere in the world, without any permission required, without seizures, limits, or credit checks. And we live in a rapidly digitizing world, with 2B websites and more goods and services added to the Internet daily. And many of those goods and services themselves are becoming digital. This is why I dumped my gold years ago, after realizing I can't put gold into my Chrome web browser, and if they got rid of physical cash, then bitcoin becomes a necessity for freedom. So in this way, commerce becomes more decentralized, and globally connected, and it should arbitrage the global economy to be much more efficient with a velocity of money that is extreme.
One thing missing has been reputation. And if this gets fixed (Slashtags, etc, are good candidates, which are decentralized free-floating tags that granular data can be appended to, they use key pairs like bitcoin, but without a blockchain, and can only be viewed/verified by the people with the public key) all systems are go. Gets easier to fund a pornstar's latest video, or send money to an insurance pool for an APY, lend my channel to a retailer in Egypt on a busy holiday, use a discreet log contract to borrow money from a dude in Brazil to take advantage of a sudden change in the weather, hire reputable coding talent in India for a project, or be the pawnshop for a gamer's expensive skins in Counterstrike Go.
I'm just saying, we are the bank, albeit a distributed version, and can do all the things their prestige has heretofore granted them, but with more speed, faster settlement, and lower cost. That's I guess the DeFi I was talking about. No tokens. But real goods and services. Arbitraging the global economy to freedom.
All this many years away, and bitcoin will have a flattened confidence curve by then, meaning it'll be less volatile than most local currencies, if those are still around, and credit markets will rapidly build around it.
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