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author:Thejaswini, source: Token Dispatch
Preface
A Tuesday in March 2023, a trademark lawsuit broke out.
Elizabeth Stark watched as the company’s biggest product launch plan failed.Lightning Labs took years to create the “Taro” protocol that allows people to send stablecoins through the Bitcoin Lightning Network.The technology is mature, the community is enthusiastic, and the main partners are ready.
Then, the judgeA temporary ban was issued.Tari Labs claims they own the “Taro” trademark.Technology continues to evolve under the new name, although competitors gained an advantage during forced suspension.
She has built one of the most important infrastructure companies in Bitcoin.Stark’s work aims to reshape how Bitcoin works, but whether her vision can be truly realized globally remains to be seen.
Before Elizabeth Stark built the Bitcoin infrastructure, she learned how to fight opponents who are far stronger than trademark owners.
Resist bad supervision
Harvard Law School, 2011.Stark organizes a grassroots campaign to prevent two bills from passing by bipartisan support in Congress.
SOPA and PIPA will allow copyright holders to mandate the website suspected of infringement to be offline.
What are they?
SOPAProhibit online piracybill》)and PIPA(The Protection of Intellectual Property Act) is the United StatesProposedofThe law aims to combat online piracy by allowing copyright owners to force alleged infringement sites to go offline.These bills allow websites to block ads, payment processing and search engine services.This may close websites even outside of U.S. jurisdictions.Many people are concerned that these laws will lead to extensive Internet censorship, damaging legitimate websites and freedom of speech.
Social media platforms, search engines and user-generated content sites will face ongoing legal threats.Most tech companies dare not directly oppose these legislation, fearing that they will anger legislators.
Stark co-founded Harvard Liberal Culture Group and helped coordinateCampus protests.The message he conveyed was thatThe bill would put the platform in liability for user content that it cannot monitor, thus destroying the Internet.
“It’s not a contest between Google and Hollywood,” she explains, “but a contest between 15 million Internet users and Hollywood.”
Wikipedia has been out of operation for 24 hours.Reddit is closed.Protesters flooded Congress’ phone lines.Within days, lawmakers abandoned the bills.SOPA and PIPAIn the committeeDeliberationDeath in the meeting.
This movement made Stark understand that sometimes you can’t passUnified channels beat institutions, but you can make their preferred solutions politically impossible.
While in law school, she also createdEstablished an open video alliance (Open Video Alliance), and produced the first open video conference.The first event attracted 9,000 participants, demonstrating the need for a traditional media “gatekeeper” alternative.But organizing meetings and confronting bad legislation seems too passive.After graduation, Stark held academic positions at Stanford and Yale University, teaching how the Internet reshapes society and the economy.She studies digital rights and works with policy organizations to develop a more complete framework around emerging technologies.
Policy solutions always lag behind technological change.When lawmakers are well aware of new technologies to properly regulate, these technologies have evolved into something else.
What if we can build technology to resist bad supervision from the beginning?
The Battle of Bitcoin
In 2015, the Bitcoin community was fighting for its future.
The “block-sized war” has been going on for months.Bitcoin can only process about seven transactions per second, which is far from enough to compete with traditional payment networks.Yipai hopes to increase the block to accommodate more transactions.Another party wants to keep the blocks smaller to maintain decentralization.
This debate is about survival.Will Bitcoin remain decentralized or will it be controlled by the interests of mining companies and enterprises?
Elizabeth Stark observed the struggle with interest.She has seen similar battles in Internet governance,Technical decisions often involve politics.But Bitcoin doesn’tsame.There is no central authority to impose a solution.The community must reach consensus through code and economic incentives.
As the debate intensifies, developers propose a different approach: build a layer 2 network on top of Bitcoin, which can process millions of transactions per second while keeping the underlying layer secure.
This is the Lightning Network.
Instead of recording each transaction on the Bitcoin blockchain, users can open a payment channel and settle multiple transactions off the chain.Blockchain transactions are required only when opening and closing channels.
These channels can be connected to each other.If Alice has a channel with Bob and Bob has a channel with Carroll, Alice can pay to Carroll through Bob.The network will form an interconnected payment channel system that handles instant and low-cost transactions.
Stark saw the potential and the challenge.Lightning networks are still theoretical.Technology requires complex encryption protocols and has not been tested on a large scale.Most Bitcoin users don’t understand why a second layer solution is needed.
In 2016, she co-founded Lightning Laboratory with programmer Olaolui Osantokuen.The timing is risky, but the lesson Stark learned from activism is that the best time to build alternatives is before everyone realizes that they are needed.
Building infrastructure
Lightning Lab released its first Lightning Network beta in 2018.The software is not yet perfect; the channels often fail, liquidity management is confusing, and most wallets cannot properly integrate the technology.
But it does work.Users can open channels, make instant payments, and close the channels without waiting for blockchain confirmation.Early adopters are mainly developers who understand the potential of technology.
Stark wants to serve billions of people who don’t have reliable financial services.Her team focuses on the practical problems faced by real users.
How to manage channel liquidity to avoid payment failures?Lightning Loop allows users to move funds between the channel and the blockchain without closing the channel, solving some liquidity issues, but not all.
How to create a liquidity market?Lightning Pool has created a marketplace where people can buy and sell channel capacity, although adoption is still limited to advanced users.
How to run Lightning Network on a mobile device without affecting battery life?Neutrino has a privacy-protected light client, but this technology is still too complex for mainstream applications.
Each product is targeted at specific infrastructure issues.Progress is slow; Lightning Network remains difficult to use for non-technical users.Channel management needs continuous attention.Payments often fail because the route cannot find a path with sufficient liquidity.
But the foundation is strengthening.Mainstream wallets have begun to integrate the Lightning Network.Payment processors begin providing lightning services.The network grew from dozens of nodes to thousands, although most of its capacity was concentrated on a few large nodes.
Critics point out that the central radiation topology of the Lightning Network is not as decentralized as advertised.They question whether the technology can be expanded without being controlled by the major payment processors.Stark acknowledges these concerns, but believes that the Lightning Network is still in its early stages; better solutions will emerge as technology matures.
Stablecoin bets
By 2022, stablecoin trading volumes surge.Tether and USDC have more than $1 trillion in annual transaction volumes, surpassing many traditional payment networks.But most stablecoins run on Ethereum and other blockchain networks that are not as secure as Bitcoin.
Stark saw the opportunity.Lightning Lab raised $70 million to develop the later Taproot Assets, a protocol for issuing and transferring stablecoins on Bitcoin.The technology utilizes Bitcoin’s Taproot upgrade to embed asset data into regular transactions, making stablecoin transfers look like regular Bitcoin payments.
These assets can be moved through the Lightning Network.Users can send USD, Euro or other assets instantly while benefiting from Bitcoin’s security.Each stablecoin transaction will be routed through Bitcoin liquidity, which may increase the demand for Bitcoin and incur fees for node operators.
“We want to bitcoin the dollar,” Stark explains, although it’s still unclear whether people really want their dollar to be bitcoined.
What is the reason?While the technology supports the use of USD-denominated stablecoins on Bitcoin, the wide user base of stablecoins remains primarily in Ethereum and other more mature ecosystems with deeper infrastructure, liquidity and developer activity,This makes Bitcoin stablecoins still belong to the niche market.
Bitcoin minimalists sometimes question the addition of non-bitcoin assets to Bitcoin, reflecting ideological hesitation or tendency to keep Bitcoin as pure “digital gold” rather than multi-asset settlement layers.
Users in emerging and inflationary markets need stablecoins to remain stable, but adoption on the Bitcoin Lightning Network needs to overcome complexity, liquidity and user experience barriers compared to the mature stablecoin track.The market is still determining the market fit for stablecoins on the Lightning Network, so it is large-scaleDollar Bitcoinization“The need is ambitionbut not yet confirmed.
However, the trademark dispute forced “Taro” to be renamed Taproot Assets, but development efforts continued.By 2024, Lightning Lab has launched Taproot Assets and has begun processing real stablecoin transactions.The bridge service transfers USDT from Ethereum to the Bitcoin Lightning Network; users can send USDs at a cost of several cents.
But the adoption rate is limited.Most stablecoin users remain on Ethereum, which has a more developed ecosystem.Bitcoin minimalists question whether it is necessary or desirable to introduce other assets into Bitcoin.Although technology is feasible, the product market compatibility is still elusive.
Network effect issues
Today, Lightning Labs runs important Bitcoin infrastructure by developing and maintaining LND (Lightning Network Daemon).LND is from the Lightning NetworkmainSoftware implementation, which provides support for most of Bitcoin’s second-tier payment channels.But Elizabeth Stark’s grand vision has not been confirmed.She envisions building a “currency internet” that allows financial services to operate globally without government or corporate licenses.
In theory, comparison with Internet protocol is reasonable.Just as anyone can build websites and applications on the Internet protocol, anyone can build financial services on the Lightning protocol.The network will be open, interoperable and censor-resistant.
But the network is only valuable when people use it.Lightning Network adopts the fastest speed in countries where currency is unstable or banking systems are unreliable, but even there, the number of users is only in a thousand, not a million.Remittance companies try to use Lightning Network, but most of their businesses still rely on traditional channels.
Stark’s team is committed to integrating AI for autonomous payments, privacy improvements and providing educational resources to developers.Every advancement is technically impressive, but mainstream adoption always seems to be far away.
“Bitcoin is a movement,” Stark said.“Everyone here is involved in building a completely new financial system.”
This movement does exist, but its impact on ordinary people is still limited.In theory, Lightning Network can process thousands of transactions per second; but in reality, most people are still using credit cards and bank transfers.Whether Bitcoin payments can be as natural as sending emails depends on solving user experience issues that have persisted over the years.
But the Lightning Network is still far from what Stark calls “as simple as sending an email.”Managing channel liquidity is like being the bank’s operating department yourself – you need to constantly monitor whether the funds are sufficient at both ends of the payment channel, otherwise the transaction will fail.Payment routing can be interrupted when there is insufficient liquidity on the routing path, which happens more often than you expect.Setting up Lightning Network still requires reading the documentation and understanding concepts such as “inbound capacity”.Most people want to transfer money with just one button instead of becoming an amateur liquidity manager.
Lightning Labs has spent $70 million on developing Taproot Assets, improving node software, and trying to convince developers to build Lightning applications.Taproot Assets is designed to allow stablecoins and other tokens to flow through the lightning channel, which may make sense if people really want to send stablecoins through the Bitcoin infrastructure instead of using the existing stablecoin network.They are also working to make LND software easier to use and trying to educate developers about why they should focus on Lightning Network.Whether these efforts can allow ordinary people to actually use the Lightning Network for daily payments is still an unknown.
Technology is feasible, but“feasible”and“Good enough for ordinary people”It’s two different things.
