It was a monumental year for Bitcoin’s Lightning Network. As the year draws to a close, we reflect on the most impactful developments and moments of 2019.

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Bitcoin 2019 in Lightning: What This Year Brought - Bitcoin Magazine

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Technical

2019

bottle pay

ledger of szabo

Lightning network

Sparkswap

sphinx chat

Watchtowers

whatsat

bitcoin

channel

channel management

channel management routing

channel management routing and payments

existing messaging services

lightning

lightning lab's lightning

Bitcoin Magazine provides news, analysis, information, commentary and price data about Bitcoin.

Bitcoin Magazine

Colin is an associate editor and staff writer for Bitcoin Magazine. He&#39;s proud to call Nashville his home, where he lives with his family and doesn&#39;t eat hot chicken as much as you might think.

Colin Harper

It was a monumental year for Bitcoin&rsquo;s Lightning Network. As the year draws to a close, we reflect on the most impactful developments and moments of 2019.

Read Part 1 of our series, Bitcoin&rsquo;s 2019 in Tech: What This Year Brought Us, here. Even as we entered 2019 in a bear market, the receding bitcoin price was matched by a rising tide of excitement for and development on Bitcoin&rsquo;s second layer payment protocol, the Lightning Network. Over the course of the year, we saw payment routing improvements, the introduction of mobile wallets, a flush of liquidity into the network and the emergence of Lightning fiat ramps. Oh yeah, and we also watched as a Lightning payment bounced around the globe over 275 times via Bitcoin Twitter, all started by an anonymous astronautical tomcat (this was one of many community developments that encapsulated the teeming excitement around the new technology). Here are our highlights for the Lightning Network in 2019. Wallets&nbsp; A dozen or so new Lightning wallets proliferated in 2019, overwhelmingly for mobile devices. One of the most anticipated, Lightning Lab&rsquo;s Lightning Wallet for iOS and Android, was one of the first to make use of Neutrino, a lightweight client that fetches data block-by-block so users can run a noncustodial Lightning wallet without having to run a full Bitcoin node. In its company is Zap, which also leverages Neutrino and launched a desktop and a mobile version this year, and Breez, the first Neutrino mobile wallet that is only available on iOS. All of the above were released in the summer and run on LND, Lightning&rsquo; Lab&rsquo;s implementation of the technology. For its own implementation, French Lightning development company ACINQ released Phoenix as 2019 was winding down. The Android-only mobile wallet runs a full, lightweight Lightning node on your device. We&rsquo;d be remiss if we didn&rsquo;t mention Tippin.me and the late Bottle Pay. Though Tippin.me technically launched in December 2018, the browser-based custodial wallet became a hit on Bitcoin Twitter in 2019 for sending and receiving tips. Bottle Pay launched halfway through the year and also became a favorite for social network micropayments before it shut its doors in response to new AML regulations. More than just a tipping app, Bottle Pay was an extremely user-friendly web wallet. It&rsquo;s in a class of custodial wallets like Wallet of Satoshi, another from the Lightning Class of 2019, that prioritizes convenience and a slick UX over self-sovereignty.&nbsp; On-Ramps&nbsp; Plenty of wallets proliferated in 2018, too, but none that offered options to purchase bitcoin on Lightning with fiat. In 2019, this is now a possibility thanks to a few new options. Two of these come from existing wallets, Sparkswap and Zap. Coincidentally, these onomatopoeic wallet providers both had the same idea: to integrate their products with a buy option. Sparkswap&rsquo;s desktop wallet was the first to offer this using atomic swaps; a user sends an ACH bank transfer to Sparkswap, and then it executes an atomic swap to transfer bitcoin from on-chain into the user&rsquo;s Lightning wallet. Zap&rsquo;s Olympus, which is actually still in development so it&rsquo;s not available yet, does something similar, except it uses what are called Turbo channels to &ldquo;push&rdquo; a Lightning channel to a user after they pay for the channel. &ldquo;If you want, you can buy bitcoin inside of Zap with a bank account, debit card, Zelle, whatever &mdash; and it will give you the bitcoins, from purchase to spending on Lightning, in less than five seconds,&rdquo; Zap founder Jack Mallers told Bitcoin Magazine in September 2019. Lightning also got its first major exchange integration this year. In partnership with Bitrefill, Bitfinex opened its coffers to Lightning bitcoin deposits and withdrawals in the final month of the year. Like trading regular bitcoin on a custodial exchange, Lightning Network balances are represented as IOUs, but they are paid out to a Lightning wallet upon withdrawal. It&rsquo;s not a fiat gateway, but you can also buy &ldquo;Thor&rdquo; channels on Bitrefill for bitcoin. Like with Zap&rsquo;s delivery method for Olympus, Thor channels are pushed to the user upon purchase, and Thor Turbo channels are instantly delivered without waiting for on-chain confirmations to lock the bitcoin into the payment channel. An added bonus: You can purchase these channels with cryptocurrency from your Coinbase account. As these options continue to develop, they&rsquo;ll be looking to solve one of Lightning&rsquo;s many UX problems: in this case, on-boarding. Channel Management, Routing and Payments&nbsp; As some teams look to enable smoother onboarding, others are focusing on making channel management, routing and payments frictionless. One of these channel management tools hopes to give users the option of moving bitcoin in and out of payment channels without closing them. When Lightning first came out, channel management was cumbersome in part because, if you wanted to lock more sats in a channel (or take a few out), you&rsquo;d have to close it and open an entirely new one. Lightning Loop opens this closed loop, so to speak. Using submarine swaps, the protocol by Lightning Lab&rsquo;s Alex Bosworth and Bryan Vu allows its users to move bitcoin in and out of channels without having to close the channels and broadcast their state onto the blockchain. This saves time, money and technical headaches. &ldquo;The vision for Lightning Loop is to allow users to securely move funds in and out of the Lightning Network using non-custodial Bitcoin contracts,&rdquo; Bosworth and Vu wrote in a blog post. &ldquo;With Loop, users, businesses, and routing node operators are able to keep Lightning channels open indefinitely, making the network more efficient, more stable, and cheaper to use.&rdquo; Currently, many wallets use a variation of Lightning Loop to the same effect. Lightning Loop makes lubricating channels with fresh liquidity easier, thereby relieving problems with inbound/outbound capacity. There&rsquo;s also the problem of payment routing, something another new feature, atomic multipart payments (also simply known as &ldquo;multipart payments&rdquo;), is trying to solve.&nbsp; This trick allows users to split a single payment into multiple payments; instead of piping one payment down a single payment channel, it can now be sent through several.&nbsp; &ldquo;This greatly reduces the headache of managing how many channels to open, and how to allocate funds to them, since you can now simply combine them as and when necessary,&rdquo; Christian Decker of Blockstream wrote in a blog post. Lastly, courtesy of Lightning Labs CTO Olaoluwa Osuntokun, sending Lightning payments is getting easier. Currently, you&rsquo;d have to receive an invoice for a specific saoshi amount to send a Lightning payment, but Sphinx Send promises users &ldquo;the ability to send a payment to a destination without first needing to have an invoice,&rdquo; according to Osuntokun. The feature is available now on LND but requires a user-activated update to install. It has yet to be introduced in a major LND release. Watchtowers&nbsp; This development gets its own section, partly because it&rsquo;s cool and also because it doesn&rsquo;t really fit into any of the other categories. Channel closing is perhaps the chief attack vector of the Lightning Network; that is to say, your bitcoin are only really vulnerable in a Lightning Network payment channel when the channel is closing. This vulnerability is largely subject to human error: If you&rsquo;re not paying attention when a channel closes, the party on the other side of it may try to swindle you by broadcasting an older version of the channel&rsquo;s transaction history, thereby claiming coins that aren&rsquo;t theirs. To protect you from rogue peers, Watchtowers monitor channels and their states so that you don&rsquo;t have to. These towers can act as an extra set of eyes and, in the case that one party is cheated in a channel closing, they have the ability to seize the contingent funds and return them to the honest party.&nbsp; LApps. Lightning Applications (or LApps) are like the cocky, reckless younger sibling of Ethereum-based DApps.&nbsp; Shortly after the Lightning Network&rsquo;s release, developers tinkering with Lightning began releasing LApps, either as side projects or full-time gigs, to test Lightning&rsquo;s use cases.&nbsp; Technically, Tippin.me and Bottle Pay count as LApps, but they&rsquo;ve already lapped up the limelight. So we&rsquo;ll focus on a few others, like Pollo Feed, the only place on the internet where you can use bitcoin to feed chickens (seriously, you pay a Lightning invoice and some chickens in Rhode Island are fed on a live stream right before your eyes). Another fun (and more relevant) application is LNCast, a Lightning-native alternative to Twitch that allows its users to accept micropayments (Marty Bent&rsquo;s &ldquo;Tales From the Crypt&rdquo; is featured, for example). Turns out Lightning might be a fit for monetizing others in the media landscape, too &mdash; particularly video game players. 2019 delivered the first Lightning-powered video games. One notable examples is Satoshi&rsquo;s Games, a hub for various titles (like the Super Mario clone Super Bro and the Agar.io copycat Lightning Agar) that convert in-game points into satoshis. In a similar vein, the Ledger of Szabo, developed by Neon District games, is a Legend of Zelda-inspired game that gives its players the option to purchase characters and gear with Lightning. Then there&rsquo;s Lightnite, a battle royale that includes satoshis as loot and has Lightning-purchasable gear, as well (Fortnite fever has gripped the international video gaming conscience, so this was probably inevitable). The game is currently in closed beta, but it will go live officially some time in 2020. Most of these examples stick to Lightning&rsquo;s core use case of payments, but a couple of other LApps push the boundaries into a new territory: messaging. Thanks to a recent software update, Lightning now supports more reliable and complex messaging, and two projects, Whatsat and Sphinx Chat, are leveraging this to power encrypted messaging with Lightning. Both utilize what are known as type-length-values (TLVs) to attach extraneous data (in this case, a message) to a Lightning payment. These messages can be routed through the network...

Colin is an associate editor and staff writer for Bitcoin Magazine. He's proud to call Nashville his home, where he spends his days shouting at peddle taverns and trying to find affordable parking downtown. If it wasn't already obvious, he holds bitcoin.

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Following adoption of 5AMLD in the EU, Lightning Network service Bottle Pay shuts down. What precedent does this set for other Bitcoin businesses?

EU AML Regulations Close Bottle Pay. Who’s Next? - Bitcoin Magazine

https://bitcoinmagazine.com/articles/eus-updated-aml-regulations-forced-bottle-pay-shut-whos-next/bitcoin-magazine-euclosed

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Regulation

5AMLD

European Union

anti-money laundering

bitcoin companies

bitcoin service

bitcoin service providers

bottle

financial institutions

lightning network

With $2 million in funding behind it and a growing user base, Lightning Network wallet and tipping service <a href="https://bitcoinmagazine.com/articles/bottle-pay-raises-2m-to-expand-lightning-network-tips-across-the-web">Bottle Pay</a> was becoming one of the hottest new Lightning service providers of 2019. Then, after less than a year of operation, it shut down.



Just as it was hitting its stride, it was struck by new financial regulations from the EU.



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The <a href="https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32018L0843">5th EU Anti-Money Laundering Directive</a> (5AMLD) is a set of rules from the European Parliament that govern financial companies to ensure best practice for deterring and identifying money laundering. It takes its cue from the Financial Action Task Force’s (FATF) <a href="https://bitcoinmagazine.com/articles/fatf-guidelines-get-wrong-bitcoin">global guidance</a> for anti-money laundering and compliance regulation.



As <a href="https://bitcoinmagazine.com/articles/despite-industry-pushback-g20-may-impose-stricter-kyc-policy-exchanges">we’ve covered in the past</a>, the FATF recommends that cryptocurrency transactions facilitated via exchanges or other service providers adhere to the Travel Rule —&nbsp;a mandate that requires financial institutions to KYC recipient/sender for transfers over $1,000. It also recommends that cryptocurrency exchanges and wallets run KYC for all accounts. Many have speculated that this rule will make operations for crypto services cumbersome; they also question the gray area of where this leaves noncustodial wallets.



To take effect on January 10, 2020, the impending regulation already shook Bottle Pay enough to cause it to shutter its services.&nbsp;



With one significant service provider bowing out in response to these new regulations, what could the 5AMLD mean for other Bitcoin companies operating under the EU’s jurisdiction?



<h2>KYC Is an Old Dog, Crypto Is a New Trick</h2>



Bitcoin and cryptocurrency service providers are treated with regard as financial institutions under the updated 5AMLD directive. In effect, exchanges and other custodians are required to conduct KYC on all users and submit suspicious activity reports when necessary. This means logging the public address for each user’s individual wallet, and providing that address (and the identity attached to it) if called upon by authorities. In some cases, they may also be mandated to explicate the source of the funds.



“I’ve come across a few firms worried about this as it does sort of undermine the whole point of Bitcoin,” Mike Southgate told Bitcoin Magazine. Southgate is the chief compliance officer at forex advisory firm Hamilton Court Foreign Exchange in London and is also the director of Ermi Software Limited, which develops transaction monitoring software to detect money-laundering techniques.



Southgate said that the directive puts cryptocurrency “in the scope” of existing rules in a bid to curb anonymity.&nbsp;



“They’re not applying a different layer of rules. They’re applying rules that have been in place for ten years to a different industry,” he said.



This old/new directive doesn’t require custodians to verify KYC for inbound or outbound transfers, but it does require them to list client information on the transactions. For something like a SWIFT transfer, this is already done internally on each transaction.&nbsp;



“But what the hell do I do when it’s a public ledger [like Bitcoin]?” Southgate postulated.



“If I wanted to send you a bitcoin, then my name and address would need to be included as part of that transaction and included on the public ledger,” he continued. This would mean that, if an exchange received a payment from an anonymous wallet, they’d have to reject it or require that the KYC info be included in the transaction.



Bottle Pay, which has not collected KYC information from users, felt that these directives were too tall of an order.&nbsp;



“The amount and type of extra personal information we would be required to collect from our users would alter the current user experience so radically, and so negatively, that we are not willing to force this onto our community,” a company announcement about its shutdown <a href="https://bottlepay.helpscoutdocs.com/article/40-official-announcement-on-the-shutdown-of-bottle-pay">reads</a>.



<h2>Bitcoin Meets Red Tape</h2>



If Bottle Pay folded under the pressure, will other Bitcoin service providers also find that the directives are incompatible with their business models?



<a href="https://bitcoinmagazine.com/articles/tippinme-takes-lightning-speed-more-14000-new-users">Tippin.me</a> comes to mind as a Bitcoin business under a similar threat. Like Bottle Pay, the browser extension is a custodial Lightning wallet that enables its users to send tips and micropayments over social media. Bitcoin Magazine did not receive a response to questions sent to Tippin.me’s creator in time for publication.



Southgate believes it’s only a matter of time before all cryptocurrency custodians must answer the law’s call. Per the directive, any “entity that provides services to safeguard private cryptographic keys on behalf of its customers, to hold, store and transfer virtual currencies” is subject to the regulations.&nbsp;



The 5AMLD’s definition of cryptocurrency “is really, really widely drawn,” Southgate pointed out, so many companies will likely be caught in the directive’s wide net.&nbsp;



Still, he emphasized that these rules only apply to custodians or anyone who facilitates bitcoin-to-fiat transactions, while “personal, peer-to-peer transactions are like cash,” he clarified. Southgate seemed pretty confident that noncustodial wallet providers, so long as the users are in full control of their keys and the transaction process, should not be required to log information on its users.



This would also mean that noncustodial Lightning Network transfers are free from scrutiny, so long as they are not sent to an exchange like Bitfinex. As with on-chain transfers to an exchange, “the moment it goes through a fiat convertor or a custodian,” Southgate said, “then they need to know the details of all the people in the chain.”



“Which they’re not going to get,” he added to point out how difficult it would be to apply KYC requirements to all of the hops in a bitcoin’s movement. This process becomes even more infeasible (or downright impossible) with Lightning Network transactions, which are onion-routed over a Tor-like network.



However, Southgate believes that, ultimately, these guidelines are going to force other Bitcoin service providers to fold like Bottle Pay — if not for fear of compromising user anonymity, then for forcing their budgetary hand.



“Compliance is freaking expensive,” as he put it. “Cost of compliance is going to increase the cost of transactions on the exchange or on the network. So even if companies aren’t forced out of action by the regulations, they’re going to have to become more profitable.”



And the users will have to front these costs, he fears, which would undermine the whole point, especially when there’s no promise of anonymity anymore.



“Why would people still use them if, like Mastercard or Visa, there’s a 3 percent service charge?” Southgate asked. “There’s no anonymity, the costs have just increased, it creates a vastly less attractive prospect.”



Of course, a company like Bottle Pay could move jurisdictions. But then they wouldn’t be able to service U.K. users or anyone from a country that has FATF membership — and that’s basically everyone under the jurisdiction of the world’s leading financial countries, or FATF’s 39 participating countries. Eventually, every cryptocurrency company in this legal radius will abide by these terms, Southgate believes.&nbsp;



The United States, for instance, is stepping in tandem with the EU’s directives. Stateside financial industry regulators will <a href="https://www.reuters.com/article/us-crypto-currencies-fincen/u-s-to-strictly-enforce-anti-money-laundering-rules-in-cryptocurrencies-fincen-chief-idUSKBN1XP1YR">require</a> mandatory KYC verification for any transfers over $3,000 (the U.S.’s threshold for the Travel Rule), taking its cue from FATF’s guidance.



As always, these anti-money laundering rules take specific aim at illicit and criminal activity, but as is the case with Bottle Pay, Bitcoin service providers will likely be hit with the collateral damage. Bottle Pay noted in its blog post that it will deliberate “on the best course of action” for how to proceed in the face of the 5AMLD. The team always intended to make the app noncustodial, and if this would be enough to insulate it from the regulation, it could relaunch (though it has made no promises on this front).



Until that time does (or doesn’t) come, we’ll all sit tight and await for more clarity on how Bitcoin companies may coexist with rules it never had to reckon with until now; and we’ll be watching in anticipation to see if any other projects buckle under the pressure.&nbsp;

EU AML Regulations Close Bottle Pay. Who’s Next?

EU AML Regulations Close Bottle Pay. Who&rsquo;s Next?

EU AML Regulations Close Bottle Pay. Who&rsquo;s Next? - Bitcoin Magazine

With $2 million in funding behind it and a growing user base, Lightning Network wallet and tipping service Bottle Pay was becoming one of the hottest new Lightning service providers of 2019. Then, after less than a year of operation, it shut down. Just as it was hitting its stride, it was struck by new financial regulations from the EU. https://twitter.com/bottlepay/status/1205527116789559296 The 5th EU Anti-Money Laundering Directive (5AMLD) is a set of rules from the European Parliament that govern financial companies to ensure best practice for deterring and identifying money laundering. It takes its cue from the Financial Action Task Force&rsquo;s (FATF) global guidance for anti-money laundering and compliance regulation. As we&rsquo;ve covered in the past, the FATF recommends that cryptocurrency transactions facilitated via exchanges or other service providers adhere to the Travel Rule &mdash;&nbsp;a mandate that requires financial institutions to KYC recipient/sender for transfers over $1,000. It also recommends that cryptocurrency exchanges and wallets run KYC for all accounts. Many have speculated that this rule will make operations for crypto services cumbersome; they also question the gray area of where this leaves noncustodial wallets. To take effect on January 10, 2020, the impending regulation already shook Bottle Pay enough to cause it to shutter its services.&nbsp; With one significant service provider bowing out in response to these new regulations, what could the 5AMLD mean for other Bitcoin companies operating under the EU&rsquo;s jurisdiction? KYC Is an Old Dog, Crypto Is a New Trick. Bitcoin and cryptocurrency service providers are treated with regard as financial institutions under the updated 5AMLD directive. In effect, exchanges and other custodians are required to conduct KYC on all users and submit suspicious activity reports when necessary. This means logging the public address for each user&rsquo;s individual wallet, and providing that address (and the identity attached to it) if called upon by authorities. In some cases, they may also be mandated to explicate the source of the funds. &ldquo;I&rsquo;ve come across a few firms worried about this as it does sort of undermine the whole point of Bitcoin,&rdquo; Mike Southgate told Bitcoin Magazine. Southgate is the chief compliance officer at forex advisory firm Hamilton Court Foreign Exchange in London and is also the director of Ermi Software Limited, which develops transaction monitoring software to detect money-laundering techniques. Southgate said that the directive puts cryptocurrency &ldquo;in the scope&rdquo; of existing rules in a bid to curb anonymity.&nbsp; &ldquo;They&rsquo;re not applying a different layer of rules. They&rsquo;re applying rules that have been in place for ten years to a different industry,&rdquo; he said. This old/new directive doesn&rsquo;t require custodians to verify KYC for inbound or outbound transfers, but it does require them to list client information on the transactions. For something like a SWIFT transfer, this is already done internally on each transaction.&nbsp; &ldquo;But what the hell do I do when it&rsquo;s a public ledger [like Bitcoin]?&rdquo; Southgate postulated. &ldquo;If I wanted to send you a bitcoin, then my name and address would need to be included as part of that transaction and included on the public ledger,&rdquo; he continued. This would mean that, if an exchange received a payment from an anonymous wallet, they&rsquo;d have to reject it or require that the KYC info be included in the transaction. Bottle Pay, which has not collected KYC information from users, felt that these directives were too tall of an order.&nbsp; &ldquo;The amount and type of extra personal information we would be required to collect from our users would alter the current user experience so radically, and so negatively, that we are not willing to force this onto our community,&rdquo; a company announcement about its shutdown reads. Bitcoin Meets Red Tape. If Bottle Pay folded under the pressure, will other Bitcoin service providers also find that the directives are incompatible with their business models? Tippin.me comes to mind as a Bitcoin business under a similar threat. Like Bottle Pay, the browser extension is a custodial Lightning wallet that enables its users to send tips and micropayments over social media. Bitcoin Magazine did not receive a response to questions sent to Tippin.me&rsquo;s creator in time for publication. Southgate believes it&rsquo;s only a matter of time before all cryptocurrency custodians must answer the law&rsquo;s call. Per the directive, any &ldquo;entity that provides services to safeguard private cryptographic keys on behalf of its customers, to hold, store and transfer virtual currencies&rdquo; is subject to the regulations.&nbsp; The 5AMLD&rsquo;s definition of cryptocurrency &ldquo;is really, really widely drawn,&rdquo; Southgate pointed out, so many companies will likely be caught in the directive&rsquo;s wide net.&nbsp; Still, he emphasized that these rules only apply to custodians or anyone who facilitates bitcoin-to-fiat transactions, while &ldquo;personal, peer-to-peer transactions are like cash,&rdquo; he clarified. Southgate seemed pretty confident that noncustodial wallet providers, so long as the users are in full control of their keys and the transaction process, should not be required to log information on its users. This would also mean that noncustodial Lightning Network transfers are free from scrutiny, so long as they are not sent to an exchange like Bitfinex. As with on-chain transfers to an exchange, &ldquo;the moment it goes through a fiat convertor or a custodian,&rdquo; Southgate said, &ldquo;then they need to know the details of all the people in the chain.&rdquo; &ldquo;Which they&rsquo;re not going to get,&rdquo; he added to point out how difficult it would be to apply KYC requirements to all of the hops in a bitcoin&rsquo;s movement. This process becomes even more infeasible (or downright impossible) with Lightning Network transactions, which are onion-routed over a Tor-like network. However, Southgate believes that, ultimately, these guidelines are going to force other Bitcoin service providers to fold like Bottle Pay &mdash; if not for fear of compromising user anonymity, then for forcing their budgetary hand. &ldquo;Compliance is freaking expensive,&rdquo; as he put it. &ldquo;Cost of compliance is going to increase the cost of transactions on the exchange or on the network. So even if companies aren&rsquo;t forced out of action by the regulations, they&rsquo;re going to have to become more profitable.&rdquo; And the users will have to front these costs, he fears, which would undermine the whole point, especially when there&rsquo;s no promise of anonymity anymore. &ldquo;Why would people still use them if, like Mastercard or Visa, there&rsquo;s a 3 percent service charge?&rdquo; Southgate asked. &ldquo;There&rsquo;s no anonymity, the costs have just increased, it creates a vastly less attractive prospect.&rdquo; Of course, a company like Bottle Pay could move jurisdictions. But then they wouldn&rsquo;t be able to service U.K. users or anyone from a country that has FATF membership &mdash; and that&rsquo;s basically everyone under the jurisdiction of the world&rsquo;s leading financial countries, or FATF&rsquo;s 39 participating countries. Eventually, every cryptocurrency company in this legal radius will abide by these terms, Southgate believes.&nbsp; The United States, for instance, is stepping in tandem with the EU&rsquo;s directives. Stateside financial industry regulators will require mandatory KYC verification for any transfers over $3,000 (the U.S.&rsquo;s threshold for the Travel Rule), taking its cue from FATF&rsquo;s guidance. As always, these anti-money laundering rules take specific aim at illicit and criminal activity, but as is the case with Bottle Pay, Bitcoin service providers will likely be hit with the collateral damage. Bottle Pay noted in its blog post that it will deliberate &ldquo;on the best course of action&rdquo; for how to proceed in the face of the 5AMLD. The team always intended to make the app noncustodial, and if this would be enough to insulate it from the regulation, it could relaunch (though it has made no promises on this front). Until that time does (or doesn&rsquo;t) come, we&rsquo;ll all sit tight and await for more clarity on how Bitcoin companies may coexist with rules it never had to reckon with until now; and we&rsquo;ll be watching in anticipation to see if any other projects buckle under the pressure.&nbsp;

https://bitcoinmagazine.com/articles/eus-updated-aml-regulations-forced-bottle-pay-shut-whos-next

With YouTube poised to penalize a broad array of videos, content creators can use these five steps to monetize their work with bitcoin.

Bitcoin Fixes YouTube Demonetized Content - Bitcoin Magazine

https://admin.bitcoinmagazine.com/wp-content/uploads/2019/11/youtube.jpg

Payments

Bluewallet

content creators

Youtube

1,000 satoshis

bank account

base layer

bottle pay interface

bottle pay plug-in

bottle pay with your youtube

content

Vlad says that he's a political science graduate with a fascination for Bitcoin and free markets. His profs say he's a crazy anarchist who probably doesn't deserve his degrees. His parents say he's wasting his potential on a pipe dream.

Vlad Costea

Bitcoin Fixes YouTube Demonetized Content

What do you do when YouTube arbitrarily decides to demonetize your content and suddenly your creative work no longer appears in searches, newsfeeds or subscription boxes? Under these increasingly common circumstances, only your most loyal and hardcore fans will be able to watch your videos by specifically opening your channel page &mdash; your content will effectively be blocked from those who don&rsquo;t already know where to find it. Most recently, YouTube&rsquo;s negligence in relation to the Children&rsquo;s Online Privacy Protection Act (COPPA), at least as the Federal Trade Commission (FTC) sees it, has led the platform to require users to label any videos they create that may appeal to children under the age of 13. Beginning in January 2020, these marked videos will have their data collection blocked, leading to lowered ad revenue, and features like commenting, likes and end screens with calls to action for viewers will be disabled. Also, many YouTubers fear that new, marked uploads will not get featured by the platform, making them nearly impossible to discover for newcomers.&nbsp; All of this means that creators such as video game reviewer Arlo and toy collector AustrianLegoFan, whose output is friendly to audiences of all ages, find themselves in a situation where the future of their craft is uncertain.&nbsp; The fact that a simple YouTube search for the term &ldquo;COPPA&rdquo; reveals video titles such as &ldquo;My Channel is About to Die&rdquo; (by anime enthusiast Nux Taku) and &ldquo;COPPA and the Future of My Channel&rdquo; (by musician and cartoon voice impersonator Brian Hull) reveals a state of deep concern that may have strong negative consequences on our culture. As a form of artistic expression, YouTube videos offer entertainment and knowledge, and for all of their hard work, creators need to be able to support themselves. But, before capitulating in the face of this unfair turn of events, remember these three words: Bitcoin fixes this. As a politically neutral currency whose natural habitat is the internet, bitcoin has two great qualities that you won&rsquo;t find in the traditional financial system. It&rsquo;s unconfiscatable (no authority can seize your funds) and uncensorable (nobody can stop you from sending or receiving bitcoin). While your PayPal account may get banned or your bank account might get frozen due to political reasons, your bitcoin wallet remains perfectly capable of holding and transacting funds, no matter what. In regards to bitcoin &ldquo;fixing&rdquo; YouTube monetization, you should know that the solution only applies to content for which fans are willing to make small payments or send tips. Also, it only solves the problem of monetization &mdash; bitcoin won&rsquo;t make your videos more discoverable and will not prevent YouTube from deplatforming you.&nbsp; It&rsquo;s also worth noting that in this new paradigm of content monetization, the amount of views will not directly matter and this will naturally incentivize creators to prioritize quality and engage with their most active subscribers. In itself, this limitation is very much in the spirit of bitcoin: A scarce and valuable digital asset should end up in the hands of the best content creators. It&rsquo;s a contest of quality as determined by audience rewards, not mass popularity. How to Use Bitcoin to Monetize Your Video Content and Achieve Financial Sovereignty&nbsp; Without further ado, it&rsquo;s time to introduce the quick and simple way of monetizing your YouTube content via bitcoin. The applications and services presented aren&rsquo;t the most &ldquo;cypherpunk&rdquo; (look it up) options out there, and, in the future, you may want to learn more and move on to more advanced tools that better serve your newly found financial sovereignty.&nbsp; However, it&rsquo;s essential for you as a content creator to receive money easily and be able to access it without any external interference. Therefore, here&rsquo;s a basic five-step process that even your boomer grandma can follow. What you need to do in preparation: Sign up to Bottle Pay with your YouTube account;Install the Bottle Pay browser extension on Firefox, Chrome or Brave;Download and install BlueWallet on your phone;Download and sign up for Sparkswap (if you want to buy bitcoin with your credit card); and. (Optional) Check out Bitrefill to see what you can do with the bitcoin you receive, and if you&rsquo;re thinking about swapping your coins for national currencies, sign up to an exchange like Gemini. Disclaimer: The methods and applications presented in this article are just the simplest and most user-friendly that the author could identify. There are certainly other solutions out there, whose increased complexity brings about a series of features and advantages. 1. A Crash Course in Bitcoin From a technical perspective, Bitcoin is pretty complicated and requires months of intensive study to understand. However, here&rsquo;s a crash course which contains the four essential elements that you need to know: Firstly, 1 bitcoin (BTC) is divisible in up to 100 million units. The smallest unit (a millionth of a bitcoin) is called a satoshi. For instance, we shall refer to 0.00001 BTC as 1,000 satoshis. Further Reading: What Is Bitcoin? Secondly, the bitcoin that you will be receiving will be on a second layer called the Lightning Network. Thanks to this innovation, your transactions will settle instantly and cost a small fraction of a cent. In the Bitcoin space, we like to say that Lightning is incredibly fast and unfairly cheap. Further Reading: What Is The Lightning Network? Thirdly, services like Bottle Pay and BlueWallet facilitate your interaction with the network through interfaces that resemble PayPal or your e-bank account. You may regard Bottle Pay as your deposit account, and BlueWallet as your spending card. However, keep in mind that they aren&rsquo;t interconnected and you will need to withdraw from Bottle Pay to BlueWallet whenever you want to spend your bitcoin. Fourthly, when you want to sell your bitcoin for U.S. dollars, euros or another national currency of your choice, you will have to move them to the base layer (remember, you&rsquo;re on the Lightning Network). A service like ZigZag (that you can also find in BlueWallet&rsquo;s interface) will conveniently facilitate this transfer. After you get your bitcoin on the base layer, you can send them to your exchange account to have your bank account fuelled with USD, EUR or any other fiat currency. This is (probably) everything you need to know about bitcoin in this early phase. And if you&rsquo;re willing to embark on this trip that takes you into the realm of sound money and financial sovereignty, then you can begin by signing up on Bottle Pay with your YouTube account. Bottle Pay has a built-in YouTube integration. 2. Onboarding the Lightning Network With Bottle Pay After selecting the YouTube button on the Bottle Pay homepage, you will be prompted to log in with your account. This step effectively redirects you to the Google authentication screen where you have to type in your details. Don&rsquo;t worry, Bottle Pay won&rsquo;t save your password and this step is only necessary in order to build a bridge between it and your YouTube account. The only permissions that you will have to grant to Bottle Pay include viewing your videos and playlists, and viewing your YouTube activity &mdash; nothing that any visitor to your channel won&rsquo;t already find. Connect to Bottle Pay with your YouTube account and start accepting bitcoin fractions within seconds. Once you&rsquo;ve submitted your credentials, you will be greeted by a message which informs you that you&rsquo;ve received a generous welcome gift of 1,000 satoshis (0.00001 BTC). Yay, 100,000 more of these and you will have accumulated a full bitcoin! Only 100,000x more to go! After receiving your sats, it&rsquo;s time to understand how Bottle Pay works and tell your viewers/subscribers about it. On the left side of the interface, you will see options to send and receive payments, and the center of the screen reveals a ledger where all of your transactions are shown.&nbsp; The Bottle Pay dashboard shows you all of the latest transactions and features buttons to send and receive bitcoin on the Lightning Network. Sending satoshis requires you to paste an address or scan a QR code, while receiving them generates an invoice for which you must input the amount. It&rsquo;s nothing complicated, really. You will soon get used to it and it will become second nature.&nbsp; 3. Tell Your Subscribers About Bottle Pay and Ask Them to Install the Browser Plug-In The next step that you should take involves promoting your Bottle Pay page. Tell your subscribers to also sign up (they will also receive the 1,000 satoshis welcome reward) and take the extra step of installing the browser plugin. It&rsquo;s essential to inform them about this plug-in because it adds a quick payment button to every YouTube video they watch. It&rsquo;s available on Firefox, Chrome and Brave, which happen to be some of the most popular internet browsers. The Bottle Pay plug-in is available for Firefox, Brave and Chrome. The setup process is very straightforward, and anyone who has ever installed a plug-in like Adblock Plus will be able to complete it. It&rsquo;s a simple point-and-click experience which grants access to yet another powerful tool. Once your subscribers are running the Bottle Pay plug-in, they will be able to send tips and small payments directly in the YouTube video interface. It&rsquo;s great for you because you get to see which video gets the most satoshis (the kind of analysis that you can&rsquo;t do with other traditional content monetization tools, such as Patreon), and it&rsquo;s convenient for your subscribers. Bottle Pay shows you for which video you have received the payment/donation. This is useful for your statistics. Alternatively, your subscribers can look you up by typing your YouTube channel&rsquo;s name in the Bottle Pay search box. It&rsquo;s also a convenient way of tipping, but your stats will not be as complete if the satoshis you receive are not linked to a video.&nbsp; Your fans can search for your videos directly in Bottle Pay, but you&rsquo;re better...

Bottle Pay facilitates Lightning Network micropayments through social media and chat services and is growing along with the technology it’s built on.

Bottle Pay to Expand Lightning Network Tips - Bitcoin Magazine

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<a href="https://blockmatrix.network/">Block Matrix</a>, the company behind social media bitcoin tipping service <a href="https://about.bottle.li/#">Bottle Pay</a>, just received a fresh round of funding.



The company has come off of a $2 million seed funding round at a time when the Lightning Network, the second layer bitcoin payment network leveraged by Bottle Pay, <a href="https://bitcoinmagazine.com/articles/progress-report-lightning-network-surpasses-1m-btc-capacity-4000-nodes">continues to enjoy steady growth</a>. A Bottle Pay press release shared with Bitcoin Magazine noted that the Lightning Network currently supports over 10,000 nodes, with 800 BTC in liquidity spread across some 35,000 channels (private channels, it adds, are not included in this figure and would likely increase this figure).



Because of the Lightning Network’s promising growth, and the company’s tinkering with other cryptocurrencies and blockchain solutions, Bottle Pay will remain a “Bitcoin only product,” according to founder Peter Cheyne.



“... there is simply no other candidate,” he said in a statement. “We have been patiently waiting for a Bitcoin Layer 2 solution to reach a level of maturity that would provide the foundations for us to create Bottle Pay. The potential created by the Lightning Network is huge. It's allowing us to fully unleash the potential of Bitcoin, and get the technology in the hands of everyone.”



<h2>Lightning Network Tips Across the Web</h2>



Bottle Pay, which launched three months ago, is growing in step with the technology that its service is built on, boasting 100 percent growth month-over-month since launching. Its web app facilitates Lightning Network micropayments through social media or chat services, much like its first-to-market competitor, <a href="https://bitcoinmagazine.com/articles/tippin-enters-version-10-promising-new-feature">Tippin.me</a>, which is currently only available on Twitter (<a href="https://t.me/bottlepay">by contrast</a>, Bottle Pay is available on <a rel="noreferrer noopener" aria-label="Twitter (opens in a new tab)" href="https://twitter.com/bottlepay" target="_blank">Twitter</a>, GitHub, <a href="https://t.me/bottlepay" target="_blank" rel="noreferrer noopener" aria-label="Telegram (opens in a new tab)">Telegram</a>, Reddit and Instagram, among other platforms).



Bottle Pay’s service is a more buttoned-up version of the community-created tipping bots that populate forums like Reddit. For its part, Bottle Pay hopes to create an easy tipping rail for average and veteran bitcoin users alike, with an aim to open up the service’s tools to developers so that it can be rolled out on as many services as possible.



“We believe that people with an inspiring vision can change the world for the better,” Peter O’Donoghue, head of operations and co-founder at Bottle Pay, said in the release. “Bottle Pay facilitates new and easy ways for our users to exchange value between each other, and will provide the means for creators to develop on our tech stack. Overall, our goal is to deliver huge social, as well as economic, value through the technology we are creating.”

Bottle Pay to Expand Lightning Network Tips

Bottle Pay facilitates Lightning Network micropayments through social media and chat services and is growing along with the technology it&rsquo;s built on.

Bottle Pay to Expand Lightning Network Tips &raquo; Bitcoin Magazine

Block Matrix, the company behind social media bitcoin tipping service Bottle Pay, just received a fresh round of funding. The company has come off of a $2 million seed funding round at a time when the Lightning Network, the second layer bitcoin payment network leveraged by Bottle Pay, continues to enjoy steady growth. A Bottle Pay press release shared with Bitcoin Magazine noted that the Lightning Network currently supports over 10,000 nodes, with 800 BTC in liquidity spread across some 35,000 channels (private channels, it adds, are not included in this figure and would likely increase this figure). Because of the Lightning Network&rsquo;s promising growth, and the company&rsquo;s tinkering with other cryptocurrencies and blockchain solutions, Bottle Pay will remain a &ldquo;Bitcoin only product,&rdquo; according to founder Peter Cheyne. &ldquo;... there is simply no other candidate,&rdquo; he said in a statement. &ldquo;We have been patiently waiting for a Bitcoin Layer 2 solution to reach a level of maturity that would provide the foundations for us to create Bottle Pay. The potential created by the Lightning Network is huge. It&#039;s allowing us to fully unleash the potential of Bitcoin, and get the technology in the hands of everyone.&rdquo; Lightning Network Tips Across the Web. Bottle Pay, which launched three months ago, is growing in step with the technology that its service is built on, boasting 100 percent growth month-over-month since launching. Its web app facilitates Lightning Network micropayments through social media or chat services, much like its first-to-market competitor, Tippin.me, which is currently only available on Twitter (by contrast, Bottle Pay is available on Twitter, GitHub, Telegram, Reddit and Instagram, among other platforms). Bottle Pay&rsquo;s service is a more buttoned-up version of the community-created tipping bots that populate forums like Reddit. For its part, Bottle Pay hopes to create an easy tipping rail for average and veteran bitcoin users alike, with an aim to open up the service&rsquo;s tools to developers so that it can be rolled out on as many services as possible. &ldquo;We believe that people with an inspiring vision can change the world for the better,&rdquo; Peter O&rsquo;Donoghue, head of operations and co-founder at Bottle Pay, said in the release. &ldquo;Bottle Pay facilitates new and easy ways for our users to exchange value between each other, and will provide the means for creators to develop on our tech stack. Overall, our goal is to deliver huge social, as well as economic, value through the technology we are creating.&rdquo;

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