Apr 10 • 10M

Ep 48. Lightning⚡Baby!

Cash App ⚡ Shopify. Robinhood. Walk-to-earn🏋️‍♂️?

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Some say Crypto is a scam. Others swear it's a breakthrough technology. But which is it? Join us, as we explore Crypto in real life (IRL).
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What a difference a year makes! About a year ago the price of Bitcoin hit $63k, today it’s $43k (-30% YoY). But attendance at the annual Bitcoin conference in Miami increased 2.5x to 30,000 people this year. So what’s the deal? Let me tell you a little secret: it’s not just about price.

The conference itself is a bit of a sideshow. Tons of people I know went to Miami without stepping foot in the convention center. A lot of the action happens behind closed doors in meeting rooms, rooftop bars, and yachts. Investors, builders, technologists and enthusiast converge for one week in the sun to network and get things done.

Bitcoin 2022 key takeaways

Bitcoin magazine, the organizers of the conference, posted videos of panels and speeches on their YouTube channel. I’ll highlight some of the

CashApp launches 3 new Bitcoin services

  • Get Paid in Bitcoin enables CashApp users to auto-invest a portion of their paycheck into bitcoin.

  • Bitcoin Roundups enables CashApp users to round up payments to the nearest dollar then buy bitcoin with the difference.

  • Lightning Network integration enables users to receive Bitcoin in Cash App through the Lightning Network. The ability to send bitcoin through that network was enabled in January.

My thoughts:

  1. CashApp is key to onboarding people. The fast-growing app has 30 million monthly users. But the demographic is younger and more diverse than the typical bank account holder. CashApp knows that culture leads finance. They routinely partner with hip-hop stars like Megan the Stallion and Lil Nas X for cash and Bitcoin giveaways. This helps drive adoption and builds goodwill for the brand.

    In 2017, CashApp was a little app in the South..3 years later it has significantly grown market share at the expense of Venmo
  2. CashApp meets people where they are: Offering bank-like features like auto-investing and roundup is familiar to the average Joe. Additionally, CashApp excels where crypto falters, CashApp user experience is simple and easy to follow. Building out auto-investing would produce a baseline of steady income for Block (owners of CashApp). It’s a win-win.

  3. Walled gardens to open fields: Today you can only send funds to people who have the same app. So now I have a zillion apps on my phone…ugh. For example, I only use CashApp to pay my barber but then I use PayPal to pay my powerlifting coach. CashApp and PayPal are walled gardens, they are not interoperable. Imagine if you could ONLY send emails to people who had a GMail account. That would be incredibly annoying. We would all end up with a zillion email accounts. But in the future we should be able to pay like we email. The future is wide open fields not walled gardens. The Lightning Network can help us get there. But we need more businesses to integrate the Lightning Network….

Robinhood is integrating Lightning Network ⚡

  • 6 months ago Robinhood announced it was launching a Digital Asset wallet. It quickly garnered a waitlist with over 2 million people

  • This week, Robinhood announced that it would integrate Lightning Network to enable faster Bitcoin transactions

  • This is meaningful as Robinhood has over 22 million users. Like CashApp, its users tend to be younger than the typical bank account holder. So far only about 10% have indicated interest in the crypto wallets but I expect that could grow with time. 2 million is good but we need a LOT more integrations to the Lightning Network….

Strike integrates Shopify and NCR (largest POS operator)⚡

  • Jack Mallers, CEO of Strike, announced that they are integrating the Lightning Network into Shopify and NCR. This is a HUGE deal.

  • Shopify is the third-largest online retailer in the US behind Amazon and eBay. There are over 1.1 million live stores on Shopify in the US and another 1.2 million around the world

  • NCR is the largest point-of-sale (POS) operator. POS machines are the gadgets we swipe our cards in to pay for goods and services as we are checking out of the grocery stores, coffee shops etc.

    Sample view of NCR payments partners
  • These integrations would enable millions of merchants to transact using the Lightning Network. Access would be extended to brands, merchants and stores that you are familiar with.

  • The cool thing is that this integration would enable customers to pay in Bitcoin or stablecoins or even dollars. Exciting times ahead. But the question is, will we see adoption?

  • I don’t know. Why?

    • #HODL: I don’t want to part with my Bitcoin today because I believe the price will be higher 5-10 years from now.

    • Inertia: The typical person would default to continue paying the same way unless there is a trigger. There needs to be significant benefit or cost to trigger behavior modification. For international payments, Lightning Network is cheaper, faster, and more convenient to use than some existing options. But domestic payments…I think the interoperability between walled gardens could be one driver. I think merchants stand to save money on interchange fees by switching to the Lightning Network, it would make sense for some merchants to offer discounts to customers who pay with the Lightning Network. But other than that, am I missing something?

Lightning Labs ⚡

  • The leading Bitcoin developer has raised $70M in it’s Series B from Valor Equity Partners and global asset manager Baillie Gifford, both early backers of Tesla and SpaceX; Robinhood CEO Vlad Tenev, NYDIG and Silvergate CEO Alan Lane.

  • The goal is to transform the network into a multi-asset layer atop Bitcoin. The first step would be to add stablecoins. Lightning would enable fast and high volume stablecoin transactions. In the future, other asset types like NFTs could be added too.


What’s on my mind

Walk to earn 🏋️‍♂️

I like fitness. I like making money.

This week, I discovered Fitness + Money = “walk-to-earn”. Have you heard about this?

There are a couple apps where you sign-up for a workout commitment e.g., walk 10,000 steps a day then you get get paid in crypto for following through. I haven’t signed up yet but I’m immediately think what’s the catch? So far, it looks like some of these apps require you to buy some tokens and perhaps you get penalized if you don’t follow through.

Check out Step and learn more here.


I hope you spend sometime outside this week. It’s spring and the weather has been glorious. I’m aiming to walk outside for at least 30 min every day. Join me!

Ciao

Afo