A cool use of the Lightning network is the podcast 2.0 initative. Currently, as I listen to podcasts, I stream back satoshis (sats), value for value (I use Castamatic on iOS, fountain.fm is also an option on Android). You can also send messages with sats attached, called “boosts”. Creators can transparantly split the sats they receive over various goals (i.e. FOSS projects [opensats], or guests on shows). There are no transaction fees afaik, that is just when your lightning node syncs with the main blockchain, and then you can bundle a lot of transactions.
I find this a very healthy counter movement to the current centralization that is going on in Podcasting where indie creators are being sucked into Spotify and YouTube (and sometimes are being censored there).
The podcast 2.0 movement is not all about value for value, there are also cool features like artwork per chapter, sharing of snippets, a way to specify different formats (like opus) for the same podcast/episode, and many more modern things. It’s a cool community and if you ask me, the first really useful thing to come out of “blockchain”.
Edit: Yeah I want to add some references but my company uses Cisco Umbrella and some things are blocked. Moreover, I can see it also MITMs my own websites (like my NextCloud instance), because those are not my certs!... But I digress.
I really dislike this whole initiative and much prefer the patreon model.
One reason of course might be that i am listening to Jupiter Broadcast and Chris pushes this stuff hard, really annoying me with the constant talk about lightning and especially the boosts, which seem to take over half the show, because somehow he seems not to realize that the problem he has in getting regular supporters is the insane price he asks (last i looked about $2,50 per episode), but likes to give everyone several minutes of the show who sent him 20 cents.
But I think my misgivings go further than that and i am especially concerned about this taking over podcasts or even open source, because while I do understand that people need to eat, I think these two ecosystems especially thrive because so many people contribute to them without profit being their first motive. I would not ask people to do work for free, but I often find that that when profit comes into it, quality starts to suffer and ideals get lost.
Sure, lightning is in some ways similar to patreon etc. because it might still be user financed, but I feel the unpredictability of getting funds, the more attention focused model, will have similar effects on creators than other platforms with similar models do and I am mostly not fond of this.
Chris indeed pushes it hard, I think indeed too hard, I agree. But it's reducing and moving to other shows (like OfficeHours.hair). To him this is the response to centralization of podcasting and I see that. As a member (I do 8$ a month, supporting 1 show but listen to all) I also see the imbalance in the attention that 2ct boosts get. It will go 1 of 2 ways I guess: 1) Boosts become the main income and keep getting attention (but at some cutoff like with NoAgenda donations. 2) Boosts remain a minor part and the attention decreases. If I were you I'd sit it out and let Chris try.
I do like putting 100$ every (half?) year or so in my podcast app and letting the app distribute it over everything I listen to. But that's also because I'm at an age where I have disposable income. I pay for the membership to get the ads out of my fav podcast.
If you want to see what "Boost" (donation) related content ends up looking like, look to popular twitch streamers. It's not great for those who want valuable and interesting content, and instead favors those who develop parasocial relationships and are addicted to getting their favorite personality to pretend to care about them.
You are right and i should not even have mentioned him, because i don't support him (though i wanted to once) and so really have no grounds to complain. I let my annoyance get the better of me and it seems just mean now when i reread it.
It also just undermines my skepticism and dislike of the podcasts 2.0 thing, which should have been my main point.
Well, fwiw, imho it's good criticism and skepticism is warranted and I agree with it. But it's early days.
I always warn here on HN that we should not throw the baby away with the bathwater, meaning, don't kill (or over-regulate) blockchain before it can grow into something nice (from the monster it is now). Imho these are the seeds of something nice, but it's not there yet. I can feel it coming though, because of things like Podcasting 2.0.
But again, podcasting 2.0 also enables (as you probably heard many times by now ;)) life streams right in the podcast app. It just displays a badge that your fav podcast is now life-streaming and you can participate. I think that is just really cool.
Using the blockchain again though, you can make instant donations through BTC lightning, and have your value 4 value boosts live-read as you listen. I mean, that is at least a bit cool right? The equivalent of throwing some cash... Hmm, this is going in the wrong direction again...
It's not still early days. Bitcoin was created 13 years ago, it was useless for payments back then and it's still useless for payments now. Every direction that anyone takes it will be in the direction of some kind of pure money-making thing, usually in the form of a ponzi or pyramid scheme. This has happened over and over again for 13 years. There's simply no one else interested in building on this because everyone else can see that the technology is useless. The only way the scheme even works is because the miners are continually promised profits just for doing the useless "work" of running a node. If you take that away, you're left with an ordinary distributed database, and you can't use that to get VCs all excited with buzzwords and promises of instant profit, so nobody in the bubble does it.
We should absolutely throw away the bathwater. There's no baby. I'll say it right out. Cryptocurrency should be completely banned by every country on the planet. They have no purpose that isn't outright fraud and theft. Everything described in Podcasting 2.0 can be done with regular old Web 2.0 technology, and it can be done more efficiently that way too.
Edit to those downvoting: I will gladly retract this entire comment if you can demonstrate a single real, non-fraudulent usage of blockchains. I've been asking this for years and never gotten a straight answer. Everything is always "just around the corner" but every time I look around the corner all I see is more fraud and scams. If you really think there's something salvageable here, then let blockchains live on as a theoretical research project until somebody figures it out. In the meantime, please stop encouraging the general public to put their money into this. It's irresponsible to raise money this way.
Hyperledger is a set of open-source distributed ledger related technologies, the most well-known being Fabric, which is a framework for creating blockchain networks.
The most interesting cases are S&P Global and Walmart, who use it to keep track of data for various auditing purposes. The idea is that since data on a blockchain can't be modified on a whim without that change being observed, it protects the integrity of the data being stored. Basically it is being treated as a sort of database.
I've seen those and I wouldn't describe them as "blockchains" in the same sense that cryptocurrencies use it. The word seems to only be used for marketing purposes. Those are just an ordinary ledger with some sharding/mirroring.
Blockchain itself just refers to a linked list (the chain) of cryptographically hashed items such as a timestamp and the data it is time-stamping (the block), which is based on previous elements in the chain. This is also how how it is also described in the original Bitcoin paper.
Blockchain doesn't rely on crypto, crypto was implemented using blockchain. Blockchain was invented long before crypto in the early 90s at Bellcore. Crypto may emphasize transactions and combating double-spending (due to nodes being on a public network), but no one is held to crypto's use of blockchain to be blockchain. The Bitcoin paper cites both the original Bellcore paper and its follow-up discussing the use of Merkle Trees, and the Bellcore paper cites patent documents as a potential use-case. So I think what S&P Global and Walmart are doing are valid use of the technology.
Now whether or not cryptocurrency itself or the networks they run on have value is a different story. For what it's worth, one of the use-cases for Corda that I found basically advertised itself as "we are better than transacting with paper" lol.
> The idea is that since data on a blockchain can't be modified on a whim without that change being observed, it protects the integrity of the data being stored.
Audit logs are not a new thing. Immutable data stores are not a new thing. This can be done in any number ways, each of them more efficient.
Moreover, it doesn't help with data entry. Yes, data cannot be modified. And still someone orders bananas and ends up with mouldy tomatoes.
> S&P Global and Walmart, who use it
I very much doubt they use it. All these "use cases" fall apart within a year or two after initial starry-eyed announcements
> Basically it is being treated as a sort of database.
Indeed. Treated like a database. When people treat Kafka as a database, those people are derided and there are entire articles on why you shouldn't treat a read-only append-only log as a database. But sure. Once it's blockchain, it's amazing and the bee's knees.
Honestly why would anyone care about that? I am genuinely curious to hear what reason you have to want that other than rent seeking e.g increasing personal wealth without having to create more wealth.
From what I can tell people who want a fixed supply currency basically just want to sit on it, wait for idiots who actually create wealth to do so and then take an undeserved cut. In other words they want to take the economy hostage for their own special interests and turn the rest of the population into debt slaves and finally reinstate feudalism.
What do you do with your salary in the end of month? I bet you invest part of it. Why do you do that? Are you an investor? Do you think you have enough information to beat the market?
I imagine you don't. You probably invest because you don't want to lose your purchasing power. That's all. This is what fiat system makes us do.
I just want a currency that doesn't push me to have to invest my money all the time only to keep my monetary power. That's it. Simple as that.
No. Obviously not. Money is not an arbitrary or objective thing. It is inextricably coupled to the power invested in sovereign governments. This is not a flaw. It is the product of thousands of years of human progress.
That makes no sense. I wouldn't have to keep repeating myself if crypto people didn't also do the same thing. Also, please don't describe the act of disagreeing as being "in hysterics", that's bad discussion.
It's only tired and copypasta-like because it can't be refuted. He's right. Cryptocurrency had it's shot, here's what we got out of it:
1. People trying to make a currency or interoperable token that they can directly or indirectly profit from
2. People trying to replace traditional object-relational databases or P2P networking with the Blockchain
Neither of those are particularly meaningful to the average person. They buy their Cherry Pepsi with a Mastercard and then listen to Podcasts on Spotify or the preinstalled iPhone app. People won't care about this stuff until it's meaningfully integrated into our lives, which is something all of these cryptocurrencies have failed to do. There is no killer app, there is no data revolution. People have been beating this decentralization drum for decades, and nothing happened. If you think that Cryptocurrency is going to deliver us from surveillance capitalism into another digital golden age, then you're failing to see the entire picture. Luckily, proving this thesis right is simple: we just have to wait and watch as cryptocurrency values continue to plummet, and as VC interest in Blockchain-backed technology dries up. It's looking increasingly correct with every passing day.
It's fun being starry-eyed about cool tech, but the Blockchain is a failed experiment. Our suspected fears are true: running an anonymous, distributed and append-only ledger where anyone can be an operator is a bad idea.
It was obvious the moment Freicoin died. That currency quite literally couldn't be used for speculation. It's only potential use case was as a medium of exchange and that didn't happen.
I mean, they could expand their sample size and the situation wouldn't be any different. Shitcoins come and go, but even the most benevolent of cryptocurrencies don't have a real shot at widespread success.
I'd put open source in a different category. Most people who make a reasonable living doing open source do so because a company is paying them to do so as their day job. There are certainly exceptions but, for most, writing (non-custom) software, writing books/articles/podcasts/video mostly works as either strictly a hobby or as something a company is paying them a salary to work on--at least in part.
why should content creators have to go through a centralized website like Patreon in order to get value from their consumers, giving Patreon a cut in the process? sure it's (for now) more straightforward for end-users, but as a content creator you're locking yourself into the Patreon Platform, you're building (at least some subset of) your content and your business around it being specifically "Patreon content". I'm generally wary of anything cryptocurrency but Podcasting 2.0 seems like an absolutely solid use-case of Bitcoin and Lightning—anything that helps to prevent centralized platform lock-in for content creators should be applauded!
> why should content creators have to go through a centralized website like Patreon in order to get value from their consumers, giving Patreon a cut in the process? sure it's (for now) more straightforward for end-users…
You answered your own question, but there's also no reason to use a "centralized website" (i.e. a 3rd-party service) if it doesn't add value. You just handle the subs yourself and provide a unique feed URL in return.
sure, if you want your podcast's business model to be "you must pay to access this content." it has been argued that this is not the best business model for a podcast, as you're either locking out your entire audience until they decide to start paying, or if you go for the "regular podcast is free but Paid Members get access to additional content" model, then you're producing content that only a fraction of your audience gets to experience. if you're doing a weekly show with an additional bonus paid weekly show, this can lead to situations where something is discussed at length on the the bonus paid show, and then referenced on the free show, leaving unpaid members in the dark as to wtf you're talking about.
this is the traditional model of subscription-based content, but Podcasting 2.0 is based upon the "value-for-value" idea, where listeners are encouraged to willingly give money to support the show, possibly in exchange for a shout-out (akin to YouTube "Superchats") or something like that. the model sounds unintuitive, but it has sustained No Agenda since the late '00s, and other shows as well.
another podcast I tune into every week and love does the Patreon thing. they do a free, public weekly show, and an additional bonus show only for paid Patreon subscribers. I pay them through Patreon (who takes a cut) for the privilege of accessing a link to an unlisted YouTube video each week to watch the bonus show (which they explicitly refer to as a "bonus Patreon podcast" in the show itself! why intertwine your brand with Patreon like this?!). each week the bonus show gets less than 100 views, yet the cohosts go out of their way to record an additional 30-40 minute show just for these under-100 viewers. this does not seem like a sound business strategy to me compared to value-for-value.
> …the model sounds unintuitive, but it has sustained No Agenda since the late '00s, and other shows as well.
Yes, donations are the oldest monetization model for podcasts, and this is even easier to do than authenticated feeds. Certainly, it does not require "blockchain technology".
I pay for 5 podcasts, I do it via Patreon, Memberful, and a custom (stripe-based) solution. I'm not really sure what problem needs to be solved in this space. I pay for 2 podcasts that I haven't listened to in months, I do it because I pay to support these creators. I don't need/want my listen history to directly correlate to sending money to hosts I like (nor do they, they'd much rather have the constant stream instead of peaks and valleys). Also, I actually hate the idea of "boosts", it just encourages bad behavior (just like IAP's that aren't one-time/DLC/remove-ads).
Patreon bans podcasters sometimes, you also have to be in one of the lucky countries to be able to use it - other people are excluded. There are annoying fees that Patreon (and credit card providers) take on each transaction (afaik around 10%), so the actual podcasters get quite smaller amount compared to what you send...
all those websites take their cut. and visa takes their cut. and still the podcaster can't "cash out" immediately, depending on settlement times and policies of the corporations. Essentially, the middlemen have the creators by the balls, lightning solves that.
I'm consistently surprised by HN's lack of vision in this area. The idea of a Network State / Internet-native economy is a cyberpunk dream, and crypto enables that. The constant doubt, rejection, and preference for SV-startup solutions is the opposite of what I would expect from a "Hacker Community" but I suppose HN is literally full of VCs (particularly FinTech) that don't want the competition from open crypto solutions.
Meanwhile, devs in crypto are able to build without limits and are having an absolute blast larping as anime cats on Twitter while cranking on bleeding edge ZK tech and other exciting projects.
> I'm consistently surprised by HN's lack of vision in this area. The idea of a Network State / Internet-native economy is a cyberpunk dream, and crypto enables that.
> Cyberpunk is a subgenre of science fiction in a dystopian futuristic setting that tends to focus on a "combination of lowlife and high tech",[1] featuring futuristic technological and scientific achievements, such as artificial intelligence and cybernetics, juxtaposed with societal collapse or decay.
It's the kind of world that's better to look at than actually inhabit.
"our community" is one that wouldn't know how to get to the bowling lanes if Uber went down. Hell, half of us probably wouldn't know how to get work done if Slack or Github has an afternoon outage. There's not a person on this site that would last in a cyberpunk distopia, putting the average HN user in the middle of an unmoderated forum would be like the end of Logan's Run. We'd all be standing around, stupefied by a world we don't understand.
I'm being facetious, but it's true. The average person is a weenie, and we rely on a great deal of well-maintained, centralized infrastructure to keep us going. There's a reason why people here fight to keep Fortnite off their iPhone and tries to bite the hand of anyone peddling crypto: deep down, we're all scared! We need corporations to coddle and exploit us, just like they need our money. HN, and the world at large, wouldn't want crypto even if it was "the right thing" to do.
Not exactly. Lightning means they receiver gets 100% what I send. This is particularly interesting for micropayments. I can tip someone 1 cent, or less with no middle man.
What's the incentive for anybody to open a lightning channel, providing connetivity etc. without compensation?
And even if all of this was indeed done for free (sustainably, not as a loss leader): Dispute resolution and fraud costs money. Free leaves zero margin for either, and I wouldn't use a payment service not providing both.
The parent here is exaggerating. It's not free, just very very very cheap. Nodes with channels can set fees and get paid when they a transaction is routed through them.
There is work being done on non-custodial escrow services for LN. Here's one: https://lightningescrow.io
What prevents a node connecting many consumer wallets from raising rates for "out-of-network" wallets, especially smaller ones, or independent nodes?
Think of any network: Economic forces usually drive it towards centralization if not outright monopolization, especially if interfacing with end users (e.g. banks, electricity providers, ISPs, messengers...) unless there are (effective) laws in place prohibiting it.
> There is work being done on non-custodial escrow services for LN.
I'm very curious about efforts like that. Dispute resolution is extremely difficult to do in a way that is cost-effective, yet fair enough to not drive away either buyers or sellers.
Not sure what you mean by your question. Payers choose the channel they want to send the payment over. If somebody sets a large fee, the payers will simply choose a different channel.
By that logic, if customers would see how large interchange fees can be, they would choose different payment methods than the most expensive credit cards.
The opposite is the case: Merchants almost always prefer not losing the purchase over a few bips saved on interchange and cardholders continue using their high-fee cards because issuers pay them kickbacks from that interchange in the form of rewards.
The exact same thing could happen with a dominant Lightning wallet provider (supporting channels only to their own nodes in exchange for a better user experience, incentives etc.) and merchants accepting Lightning.
Monopolization almost seems impossible to prevent at a technical level in networks due to the network effect (quadratic utility) and customers being relatively slow to change providers and easy to sway with one-time incentives. Credit cards have just had a few decades of a headstart over Lightning in that regard.
The difference between Lightning channels and credit cards, is it's much harder to create a competing credit card company than it is to spin up a new Lightning channel. And it's also more difficult for customers to get new credit cards vs switch payment channels. So, if a bank or credit card company wanted to extort certain merchants, eg saying "pay me a big fee or I will reject all payments to you", they can do so, since they know many customers are tied to their card and the merchant risks losing those customers. On the other hand if some lightning channel tried to extort merchants, both the merchant and the customer can easily switch channels to dodge fees.
This is one of the main goals of crypto. By drastically lowering the barrier to entry, competition is higher and fees are lower. This is what filecoin is doing to AWS [1], what NFT tickets are doing to Ticketmaster [2], and what Lightning is doing to credit card companies.
> As long you have some channels open and I have some channels open, the network will route my payment to you.
Just like the internet. And just like on the internet, extortion by incumbents along that route can happen, and likely will once there is an encumbent Lightning wallet provider that is too large to ignore for merchants. (All assuming Lightning or something like it is successful in the first place, of course.)
> As sender, I am responsible for any potential routing fees. You as the payee are not.
In a typical online payment scenario, the customer is the sender. Of course large wallets could strike deals with merchants to let them cover fees for their users to make this less apparent...
> If we were to transact with each other often, it could be worth opening a dedicated channel to enhance privacy and avoid routing fees.
Sure – just like you could open a tab at your favorite bar, or you could get a store credit card at your favorite retailer.
> Just like the internet. And just like on the internet, extortion by incumbents along that route can happen, and likely will once there is an encumbent Lightning wallet provider that is too large to ignore for merchants. (All assuming Lightning or something like it is successful in the first place, of course.)
This is plausible. Lightning Wallets are harder to run in a self custodial way rather than classic Bitcoin on-chain transaction.
> In a typical online payment scenario, the customer is the sender. Of course large wallets could strike deals with merchants to let them cover fees for their users to make this less apparent...
Wallet providers could turn in payment processors as well for merchants.
> Sure – just like you could open a tab at your favorite bar, or you could get a store credit card at your favorite retailer.
Not familiar with this concept, I know that it exists. Though the cost of establishing that system is mountains more than establishing a channel to your favourite bar. But it is a micro optimisation.
How do you handle the tax implications of streaming sats?
As far as I know, every payment with Bitcoin triggers a taxable event?
Do you record a gazillion log entrys "Paid $0.0000145 for listening podcasts, Paid $0.000142 for listening podcasts ...", crunch all the numbers and then at the end of the year put that gigantic list into your tax declaration?
Not a lawyer or accountant here but I think it would be reasonable to only treat the eventual on-chain withdraw as a taxable event.
Until then, you have deposited some value in a number of lightening network nodes and have been negotiating a set of pairwise IOUs with them for later.
DeFi/staking has a similar problem and I believe waiting until gains and losses are realized will be the way it goes down.
For now, make a good faith effort to pay taxes or expect some friction later.
Not a lawyer or accountant here but I think it would be reasonable to only treat
the eventual on-chain withdraw as a taxable event.
IAAL. Specifically, a tax lawyer. It would not be reasonable to treat the on-chain event as sole the taxable event.
Every transaction in a cryptocurrency is a taxable event.
This is the same tax treatment that applies any time a non-USD currency is used in a transaction (by an American). Similar rules apply to citizens of EU countries.
I do 1000 streaming transactions on a channel. When the channel is closed (withdrawn back to the L1 chain, or settled - offchain is the wrong term here Lightning is an L2 "channel"), the transactions are summarized and you can tax that summary event.
It's a linear sum of taxes. Of course there are scenarios that complicates things like variable sales tax rates based on transaction type/location/good, but that's an extended conversation.
If you really want tax enforcement, governments should be looking to develop CBDC integration on the merchant side with bridge support for major crypto currencies. Given Intuit's iron grip on tax lobbying I don't have much hope for innovate tax schemes though.
By the same logic, anything you do on a custodial exchange could never be a taxable event because it's never settled on-chain. I'd be extremely surprised if the IRS would share your view.
That's right, moving sats via LN is done off-chain. Once the channel closes, that's when it settles to L1, at which point tools like Rotki can help you figure it out.
hmmmmmmmm, you can't get those IOUs back though so you need to keep a record of transaction as they are no longer under your control, if you want to be compliant
I'm of the opinion that the rules are behind the law when it comes to BTC. I am deeply uninterested in being anywhere near the legal case that challenges this!
But currency exchange for 'ordinary purposes' is not taxed, if my company bought some Euros to pay for foreign goods and the Euro rallied against the dollar before the purchase, no tax is owed.
Well, BTC is legal tender in El Salvador, and there's no rule that the (in the above) Euros in question have to be paid to a country where the Euro is legal tender: perhaps they're a Singaporean business which mostly exports to Europe, so their prices are in Euros and it shouldn't matter.
The US might not like that El Salvator made BTC official, but that shouldn't matter either.
Better keep your books very carefully though, because buying currency with the intention of selling it later (aka exchanging it for another currency) is investment purposes.
Yes, and I'm saying that while the rulings of the SEC on this subject consider it a security, I don't believe the law is on their side any longer, since El Salvador declared it legal tender. That straightforwardly makes it a currency, and I don't believe there is any treaty framework for a country to say "lol no, your currency is fake, it's actually a security to us".
Can you imagine the hassle if a country adopted Apple stock as a legal tender? That's basically what happened last year.
That seems unlikely to me, since income tax has to be paid by recipients whether payment is in coin or in kind.
BTC is a kind. If I pay you in silver rounds, you are responsible for paying income tax for the convertible value of the silver at the time of payment, but not capital gains at any point.
sales tax, not income tax. someone has to calculate, report, and remit it for all these micro transactions somehow. I thought that is what GP was referring to , may be mistaken.
In that context cap gains vs other sorts of income is irrelevant.
Which, yikes, no wonder running your own business is such a drag, that feels like double-dipping to me. I didn't owe sales tax when I was freelancing, but it is what it is.
Either way though, it's not any sort of headache, because the dollar is still used as unit of account, and what's owed is the value at the time of transaction: what you owe on $500 delivered in BTC is what you owe on $500, presuming you turn it into cash within a year (IANAL, I recall that goods paid in kind become investments after a year, such that gains are owed if sold at a profit).
The problematic tax situation is when someone buys some Bitcoin, and then wants to spend it, since you have to figure out gains on each transaction and report it correctly, that's a huge hassle. I suspect most people who sincerely try to pay capital gains on Bitcoin purchases get it wrong: if you buy 0.1 BTC at 7K and 0.1 BTC at 45K, then spend $1000 worth at 20K, what capital gains do you owe? Does it depend on which wallet you reached into?
I have no idea and, really, feel like I shouldn't have to have any idea. It's the main thing that keeps me from paying in BTC when a vendor likes that form of payment. I could maybe pay a month's rent with the coin in my cushions, I have it because it tickles my fancy to pay for things with magic internet money, but it's just not worth the paperwork to actually do it.
I didn't mean it wasn't income (it is, and they owe income tax) I meant that wasn't the issue that was being pointed out. With microtransactions the sales tax accounting etc. overhead is fixed, but the amounts are tiny...
I may have misread GP.
re: " if you buy 0.1 BTC at 7K and 0.1 BTC at 45K, then spend $1000 worth at 20K, what capital gains do you owe? Does it depend on which wallet you reached into?"
These are not new problems, stock works the same way. You may feel like you shouldn't have to have an idea, but that's not how any of this works in practice.
I understand that argument, but don't think it holds much water in US at least, I suspect all the relevant institutions including courts and congress could care less what El Salvador tries. If it had been a peer country, different story I suppose.
I'm not on the receiving end, but to me this seems like the law is behind reality. Micropayments are coming, perhaps using blockchain, perhaps not, probably in a number of different ways.
I guess this is a good question for the hosts of the podcasts that use these features (Like Linux Unplugged, and other shows from Jupiter Broadcasting or the No Agenda show by Adam Curry and John Dvorak.) Perhaps this is not answered yet.
In the Netherlands this only becomes relevant over a certain amount, and I think you can then just bundle all amounts. But I'm also not sure.
In the US and other countries I have heard about, it applies to the sender also.
If you buy Bitcoin for $X and then buy something with those Bitcoin, then you have to record the "fair value" $Y of that something and pay taxes on $Y-$X. On the amount that your "Bitcoin speculation" has earned you.
Looks like in the Netherland, it is different indeed. Making it much easier to use Bitcoin.
Most blockchains are worthless and have nothing in the way of transaction fees or indeed transactions. Doge is perfect for micropayments! This was a fad on reddit back in the day.
In particular, well, the title of the article says it all. If you have BTC, and you want to send a few sats and pay basically nothing, Lighting has existed for years and works just fine.
Edit: I don't think micropayments are such a great idea to begin with, but the arguments for that have nothing to do with the medium of payment: assuming a perfect micropayment system, people still won't want to use it for off-topic reasons.
The existence of Lightning is a failure of Bitcoin's designers to create a system that can scale well, they instead chose to focus on something that was going to be maximum profitable for the miners in the short term and dumped responsibility off onto "L2 chains" as a kludge. The Lightning Network also doesn't "work just fine", the network is fundamentally slow, insecure and unreliable and this will likely never be fixed, because the problem space (connect an infinite number of nodes to an infinite number of other nodes efficiently) is known to be unsolvable.
If you think multiple layers in a payments system is undesirable, I wonder whether you make all your purchases online by putting dollars and cents into envelopes and mailing them to the merchants, or whether you use that additional layer of credit built atop the lower layer hard money supply.
Bitcoin was not designed to be “maximally profitable to miners”, it was designed to be a currency that could not be captured and controlled by state actors or other large players yet would be able to sustain itself and its network by incentivizing miners to set up nodes and resist attempts at hostile takeovers of the network. [1]
No other solution has managed to achieve this. There are proof-of-stake cryptocurrencies that opt to be more easily scalable on L1 at the cost that they are controllable by whoever holds the largest stakes.
I'm only replying to say that, for all I know, you're correct in all of this. I don't think so, but that's a weakly held conviction about an entire ecosystem I don't use and understand only vaguely.
The fact that I personally know people keeping hundreds of thousands of dollar-equivalent-sats on Lightning, who are happy with that arrangement, is what I'm balancing against that guy on the internet with strong opinions with 'throw' in his name.
But hey maybe you know what you're talking about. It's possible. I don't.
But you know that most people wouldn't put hundreds of thousands of dollars in a system like that. It would fall apart if that happened. Also, I don't know how they could be happy with it given the extreme crash over the last few months.
Regarding my name: The short explanation is, I have a throwaway account in protest. If Satoshi's anonymity was enough to convince your friends to put down large sums of real money based solely on a hope, it should be enough for you to consider my (non-monetized) comments on this internet forum that's mostly pseudonymous anyway.
I was dismissive, and I did that on purpose, but I wasn't being sarcastic. Only time will tell which of you is right, all I've got is "eh. looks fine from here".
As for their happiness, I know people with a lot of Bitcoin, and I know a few people who are underwater on their BTC, but there's no overlap in those groups. They might feel a twinge around 7k, more likely, they'd buy as much as they can afford.
The problem that needs to be solved is, basically, that the fundamental architecture of Bitcoin establishes an upper limit on transactions-per-second (TPS) which is too low.
Lightning "solves" this problem by moving transactions off-chain, bundling them into batches, and then emitting batches of transactions to Bitcoin mainnet. That means a transaction against Lightning is only valid once the bundle in which the transaction is placed is committed on mainnet. A confirmation from Lightning isn't good enough; users have to wait for a confirmation from mainnet.
Batching is a common optimization! But it's not a solution to performance problems. It weakens the guarantees afforded by transaction confirmation. Those guarantees are important. They define the consistency model provided by the system. The model of Bitcoin which includes Lightning is fundamentally different, and weaker, than the core model of Bitcoin.
And so Lightning isn't a solution to the problem. It weakens the transactional model of Bitcoin, and so provides a totally separate system to Bitcoin proper.
> As far as I know, every payment with Bitcoin triggers a taxable event?
tl:dr Unlikely
Unsure what the regime in your area does, but...
Here (Aotearoa) the tax authorities are not interested in rats and mice. I play in a rock band as a hobby. Occasionally we get paid ($300 is the most ever).
We had a promoter not pay us because we had "not given him the tax forms".
I contacted our tax authorities and was told, in no uncertain terms, if it is a hobby, if you are not making serious money, do not tell us about it. Please do not tell us.
We have a transaction tax here that merchants have to charge and pay, but only when their revenues top $50,000
So there are two data points that indicate that not every transaction incurs tax
Tax does indeed tend to be a hard problem in these kinds of systems, but I think you (and most responses so far to your comment) are looking at it from the wrong end. It's the seller, not the buyer, that has to deal with taxes in most jurisdictions. For podcasts I'd expect the podcaster to be the seller and the listener to be the buyer.
Simplest example is the EU. When you sell a digital good to someone in the EU VAT is owed on that in the country in which the buyer resides, but the seller is responsible for collecting that VAT and then reporting and remitting it to the buyer's country.
The EU makes this simple. You can register with any EU country, and then report and remit you VAT for all EU countries to that one country's tax agency. That country's tax agency will then settle with the others. Ireland is a good EU country for this if you are a seller in a non-EU English speaking place. It takes about 10 minutes to register with Ireland online for this, and the quarterly tax filings with them are a simple CSV upload that you can also do in a few minutes.
Note that this means the seller has to know how much they sold to buyers in each EU country each quarter. That necessitates some form of tracking.
The situation is similar, but more work to deal with, in the US with sales tax and use tax. For sake of this discussion I'm just going to call both of those sales taxes [1].
It's more work in the US because (1) thresholds for taxability are often of the form "N transaction or $X in sales" usually with N = 200 so you can get above the threshold on a very tiny sales amount as opposed to EU where thresholds are based just on amount of sales, (2) sales tax is often the sum of statewide, countywide, citywide, and special taxing district sales taxes, so to actually figure out the tax on any given sale you need to know the full physical address of the buyer, and (3) while there is some cooperation among about half the states to do a system conceptually like the EU's, for the other half of the states if you meet their thresholds you need to register with, file with, and remit to each of them separately.
There is a way around this (besides just ignoring taxes). You can go through an intermediary that takes on legally the role of the seller. It is that intermediary that then needs to track how much is sold in each state and country and how much tax is owed.
That's how it works for app developers selling through the Apple app store for example. Until tax laws are changed to be more friendly to micropayments directly to content creators, going through some kind of store that aggregates content from multiple creators is probably the best we can legally do.
[1] A sales tax is a tax on the sale of something. A use tax is a tax on having something. The big difference is that a state makes the seller collect sales tax, but use tax is suppose to be dealt with be the person who owns the thing. It used to be that states could not force sellers to collect sales tax unless the seller had a presence in the state. So states would impose both a sales tax and a use tax, and the use tax was the exact same rate as the sales tax and had a deduction for the amount of sales tax paid. The net result was that if you bought something from an in-state seller they collected sales tax and you owed no use tax. If you bought something from an out-of-state seller, no sales tax was collected and you owed use tax on the full purchase price. If you travelled to another state, bought an item and paid sales tax to that state then brought the item home, and that other state's sales tax rate was lower than your state's use tax rate, you owed the difference in use tax.
The use tax exactly equalling the sales tax and being discounted by any sales tax already paid is because the Constitution restricts the states from regulating interstate commerce. Applying a higher tax to goods from out out of state than you do to domestic goods would run afoul of that. By making it so that the total sales + use tax was the same for imported and domestic item the state was not interfering with interstate commerce.
But a few years ago the Supreme Court overturned the cases that had said that states could not force sellers with no in-state presence to collect taxes. Now states can make out-of-state sellers collect the sales/use tax so for most purposes there is not much point in distinguishing between sales and use taxes.
Except that in the US, cryptocurrencies are treated as goods, and using them to buy something is considered a barter transaction.
For a barter transaction, you must recognize the current fair market value of the object received, and compare it with your cost basis of the object given. If the current price exceeds the cost basis you are required to recognize it as capital gains. (If below, you are generally allowed to recognize it as a capital loss, but recognizing capital losses is not strictly required, although in some cases there may be reporting requirements even if you chose not to recognize the loss).
Given the volatility of most crypto assets, there is a very good chance that the crypto is worth more than when you bought it, and assuming the goods are fairly priced, it would be typically be required to recognize the fair market value of the goods as current value of the crypto used to buy the goods.
Thus there is a meaningful burden imposed on people buying goods or services with cryptocurrencies.
Slightly different rules but with similar net effect would occur with respect to an individual us taxpayer buying things with say Euros, except that if the increase in value of the euro used in the transaction was less than $200, it does not need to be reported or taxed. Also for personal transactions the gains on a foreign currency are always treated as ordinary income, not capital gains, so no discount for long term capital gains will apply.
Your comment made me wish the tax code was small enough to be diagrammed on a napkin. Instead if feels like it is designed to inhibit innovation and new business.
Let's ignore the Lightning Network for a moment, and dig into the meat of what you're suggesting: that people—in some meaningnful number—would prefer to spend money to get a thing they currently get for free (with the caveat that they occasionally they have to listen to / watch advertisements). Maybe you're right! But: 1. I doubt it. And 2. Lightning Network isn't the only technological solution to such an idea. This concept isn't particularly common, probably, because most people will put up with a lot to avoid spending actual money.
are there cool applications using Taproot and Schnorr? are lightning network openings and closings looking identical as any other transaction or script, improving confidentiality?
where are the current communities that talk about whats going on there? I don't visit bitcoin reddits anymore and the cryptocurrency communities are about pretty much everything else
I find this a very healthy counter movement to the current centralization that is going on in Podcasting where indie creators are being sucked into Spotify and YouTube (and sometimes are being censored there).
The podcast 2.0 movement is not all about value for value, there are also cool features like artwork per chapter, sharing of snippets, a way to specify different formats (like opus) for the same podcast/episode, and many more modern things. It’s a cool community and if you ask me, the first really useful thing to come out of “blockchain”.
Edit: Yeah I want to add some references but my company uses Cisco Umbrella and some things are blocked. Moreover, I can see it also MITMs my own websites (like my NextCloud instance), because those are not my certs!... But I digress.