Ben Strack

<div id="highlights-block_624766c9030f0" class="highlights">
 <ul>
 <li>A scalability solution, the Lightning Network allows for faster and cheaper bitcoin transactions</li>
 <li>Kraken originally expected to allow clients to withdraw and deposit bitcoin on Lightning Network in the first half of 2021</li>
 </ul>
 
</div>



Kraken has implemented Lightning Network to provide clients with instantaneous settlement of bitcoin transactions in an effort to help accelerate use of the asset as a medium of exchange.



The Lightning Network is a scalability solution, or layer-2, built on top of the Bitcoin blockchain that allows users to quickly send and receive BTC with virtually no fees.



“In addition to enabling instant and inexpensive deposits and withdrawals, Kraken is providing core network services that enable the Lightning network to route payments,” a company spokesperson told Blockworks. “Overall, we hope our integration signals our support of Lightning to the broader industry.”



The network can execute millions of transactions per second — compared to Visa’s processing of about 65,000 transactions per second, according to the company.



Its system of payment channels does not publish intermediate transactions to the blockchain while open, holding them off-chain to enable instant and efficient value transfer, an April 1 Kraken blog post states. These off-chain channels remain secured by the Bitcoin blockchain’s multi-signature and timelocking features.



&#8220;Bitcoin has proven to be an effective store of value over the last decade and is now seeing increased use as a borderless global currency,&#8221; Pierre Rochard, Kraken&#8217;s bitcoin product manager, told Blockworks in an email. &#8220;The Lightning Network provides real-time settlement of Bitcoin payments, larger capacity than any other system and for the first time microtransactions at scale.”



The integration comes after Kraken had <a href="https://blog.kraken.com/post/7225/a-need-for-speed-kraken-to-launch-bitcoin-lightning-%E2%9A%A1%EF%B8%8F-integration-in-2021/" target="_blank" rel="noreferrer noopener">announced in December 2020</a> that it expected to allow clients to withdraw and deposit bitcoin on Lightning Network in the first half of 2021.



The crypto exchange revealed at the time that it would be hiring a team to focus specifically on the network. The blog post stated that “easier deposits and withdrawals are just the beginning of the additional features we are aiming to provide.”



The spokesperson declined to comment on potential future features.&nbsp;



The “rapid scaling” of Kraken’s business caused the Lightning integration to take longer than anticipated, the representative added, noting that the exchange saw trading volumes across all markets hit all-time highs and its client base double in 2021.



Matthew Gould, founder and CEO of Unstoppable Domains, noted that layer-2 solutions are a big part of improving digital assets’ usability, making it easier for the mainstream population to adopt and transact with digital currencies.



“The Lightning Network is a saving grace for scaling Bitcoin, and this represents a large-scale test for the network,” Colin Pape, founder of decentralized search engine Presearch, said. “I hope that Kraken’s integration is a proof point for the validity of the Lightning Network and something that other exchanges consider, because the success of Bitcoin is the success for the digital-asset space as a whole.”



Spokespeople at competing exchanges did not immediately return requests for comment.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire">Subscribe to the Empire newsletter</a>.



Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. <a href="https://blockworks.co/newsletter/onthemargin">Subscribe to the Forward Guidance newsletter</a>.



Get alpha directly in your inbox with the <a href="https://blockworks.co/newsletter/research">0xResearch newsletter</a> — market highlights, charts, degen trade ideas, governance updates, and more.



The Lightspeed newsletter is all things Solana, in your inbox, every day. <a href="https://blockworks.co/newsletter/lightspeed">Subscribe to daily Solana news</a> from Jack Kubinec and Jeff Albus.

Kraken Supports Bitcoin’s Lightning Network After Delayed Launch

Jacquelyn Melinek

<div id="highlights-block_610d4373249ae" class="highlights">
 <ul>
 <li>In just one week, the number of NFT sales spiked 101.8% from 29,256 sales to 59,048</li>
 <li>People are beginning to think of NFTs “not only as collectibles, but as a major part of the future of digital ownership and identity, it’s easy to see how long-term growth is inevitable,” Gould said. </li>
 </ul>
 
</div>



It’s hard to log on to social media today without seeing news about the latest non-fungible token (NFT) being auctioned or sold for hundreds to thousands of dollars.&nbsp;



New NFTs are being released and sold in the crypto world every day and the excitement has caused some NFTs to spike in value and while the market is still fairly young, the trend of buying these digital collector items are far from over, Unstoppable Domains Founder and CEO Matthew Gould said in an interview with Blockworks.&nbsp;&nbsp;



NFTs began in 2017 and boomed in popularity after the crypto industry began gaining serious traction and as CryptoKitties, the Ethereum blockchain-based cartoon cats by <a href="https://cms.blockworks.co/dapper-labs-superrare-consensys-and-nifty-gateway-make-nft-news/" target="_blank" rel="noreferrer noopener">Dapper Labs</a>, came into the market as collectible items. Soon after the hype dissipated, the market fell in less than a month from the <a href="https://nonfungible.com/market/history" target="_blank" rel="noreferrer noopener">all-time high</a> of 303,620 NFT sales in mid-December 2017 to an average of about 20,000 sales in January 2018. 



“NFTs gained initial mainstream hype with digital collectibles, but as the ecosystem matures, we’re seeing NFTs expand to new use cases,” Gould said. 



<div class="wp-block-image"><figure class="aligncenter size-large"><img loading="lazy" decoding="async" width="512" height="129" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/08/NFT-marketplace-graphy.jpg" alt="NFT market data" class="wp-image-6237" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/08/NFT-marketplace-graphy.jpg?w=512 512w, https://blockworks-co.imgix.net/wp-content/uploads/2021/08/NFT-marketplace-graphy.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/08/NFT-marketplace-graphy.jpg?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2021/08/NFT-marketplace-graphy.jpg?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2021/08/NFT-marketplace-graphy.jpg?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2021/08/NFT-marketplace-graphy.jpg?w=80 80w" sizes="auto, (max-width: 512px) 100vw, 512px" /><figcaption>NonFungible market data for number of NFT Sales from August 2020 to August 2021</figcaption></figure></div>



<h3 class="wp-block-heading">Market rebound</h3>



While the market has seen volatility throughout the past few months and years, it is facing healthy corrections and already showing a rebound from recent dips, Gould said.



“I have no doubt that NFTs will continue to bounce back, but I hope that it’s steady, sustainable growth, and that NFT marketplaces put protections in place to help people invest responsibly,” Gould added.&nbsp;



NFT sales are still down about 81% from the all-time high in 2017, but are at the highest number of sales in the past 12 month period. In just one week, NFT sales spiked 101.8% from 29,256 sales to 59,048 as of August 5. Additionally, sales are up 312% from the year-ago date, according to <a href="https://nonfungible.com/market/history" target="_blank" rel="noreferrer noopener">data</a> from NonFungible. 



“As NFT marketplaces evolve and become more user-friendly, customer retention and volume will improve. People will find it easier to buy, sell, and trade NFTs, and they’ll keep coming back,” Gould said. Additionally, as the market expands beyond the Ethereum blockchain into new verticals, market activity will also become less correlated to cryptocurrency markets like bitcoin and ethereum, he said.&nbsp;



Some crypto enthusiasts, gamers, musicians, celebrities and more are dipping their toes into the NFT market, but there&#8217;s still a long way to go until it reaches widespread adoption as more people need to be educated about the industry, Gould said.&nbsp;



Earlier this year, Twitter founder and CEO Jack Dorsey auctioned his first tweet from 2006 as an NFT with a hefty final bid of $2.9 million, which gave the buyer ownership of the digital collector item. Separately, in June crypto exchange company<a href="https://cms.blockworks.co/binance-to-debut-nft-marketplace-with-warhol-dali-thursday/" target="_blank" rel="noreferrer noopener"> Binance launched a NFT marketplace</a> with an auction featuring works of Andy Warhol and Salvador Dali and its competitor, <a href="https://cms.blockworks.co/ftx-launches-nft-marketplace/">FTX</a> also launched a NFT marketplace earlier that month. 



<h3 class="wp-block-heading">Into the metaverse</h3>



“We’re definitely seeing traction that speaks to people’s interest beyond things like art and gaming. People are also purchasing NFTs that act as a “membership” to metaverses, as we’re seeing with projects like Bored Ape Yacht Club. In the next few years, NFTs that provide access to payments, Web 3.0, and the metaverse will continue to gain adoption,” Gould said.&nbsp;



Unstoppable Domains is also seeing the NFT market expand beyond its current space, Gould said. There’s a growing interest in NFT domain names and the company has recently sold more than 1 million blockchain usernames which are minted as NFTs on the Ethereum blockchain to give users full ownership and control over the names, Blockworks previously <a href="https://cms.blockworks.co/circle-and-unstoppable-domains-partner-to-make-usdc-exchanges-easier/" target="_blank" rel="noreferrer noopener">reported</a>. 



The personalized usernames allow people to complete crypto transactions across wallets and exchanges, similar to how people want their own preferred usernames on Twitter, Instagram or Venmo, users are now claiming their blockchain domain name through their company’s platform, Gould said.&nbsp;



People are beginning to think of NFTs “not only as collectibles, but as a major part of the future of digital ownership and identity, it’s easy to see how long-term growth is inevitable,” Gould said.&nbsp;