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Billionaire Jack Dorsey Bets on Blockchain as Bitcoin Price Crashes
Bitcoin prices have slipped 6% after a tumultuous week punctuated by Google’s ban on cryptocurrency ads and growing threats of regulatory scrutiny. Not even a cash injection into the blockchain from Twitter billionaire Jack Dorsey could halt the slide. (More on that below.)
The price of a bitcoin (BTC) token is trading at $7,767 at the time of writing, down 6% over the previous 24 hours, according to CoinDesk. Bitcoin’s market cap has fallen 8.56% since yesterday.
All 10 of the top 10 cryptocurrencies by market cap have fallen in tandem. The price of Dash, Litecoin, Eos, Dash, Ripple, Qtum, and Ethereum have all fallen by more than 7% in the past 24 hours. (See more: Cryptocurrency This Week: News Recap)
(Source: WorldCoinIndex)
But just because bitcoin prices are plummeting today doesn’t mean the cryptocurrency ecosystem is doomed. Twitter billionaire Jack Dorsey has invested in Lightning Labs, a blockchain startup that aims to speed up bitcoin transactions.
Silicon Valley-based Lightning Labs has received $2.5 million in seed funding from a top group of tech luminaries, including:
- Litecoin creator Charlie Lee
- Square Inc. and Twitter co-founder Jack Dorsey
- Former PayPal COO David Sacks
- Ben Davenport, CTO at BitGo
- Kevin Hartz, co-founder of Eventbrite
- Venture Capital Firm Digital Currency Group
- Robinhood co-founder Vlad Tenev.
(Charlie Lee, Jack Dorsey and Vlad Tenev/screenshot)
Elizabeth Stark, CEO of Lightning Labs, said the platform “works like a software layer that sits on top of the Bitcoin network.” (See also: How Bitcoin Works)
“If bitcoin is like a decentralized savings account, Lightning is a decentralized checking account where users can send money instantly,” Stark said. he told CNBC.
Stark said Lightning Labs is the answer to a growing chorus of complaints about high Bitcoin fees and slow transaction processing times.
“One thing we’ve learned is that bitcoin fees can be hard to predict in advance and can have big swings, so having a solution like Lightning with very low fees on the network is critical,” Stark said. “You still pay bitcoin fees on-chain when you enter or exit Lightning, but that can happen infrequently, like once a month or a year.”
Lightning Labs’ Lightning Network is expected to be a game-changer in the evolution of Bitcoin. (See more: Bitcoin Lightning Network: Three Possible Problems)
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