Recently, U.Today interviewed the CTO at Bitfinex about its plans and achievements. Also, Paolo shared why he has been a supporter of the Lightning Network and what benefits this technology can provide to the community. Don’t miss this piece!
U.Today: Hello Paolo, it’s good to have you here! As far as I remember, you have been a supporter of the Lightning Network since the beginning. What makes the technology so special? What problems does it solve?
Paolo Ardoino: Yes, as an exchange, Bifinex was one of the first supporters of the Lightning Network. We have invested in projects such as RGB protocol and OmniBOLT, with the aim of bringing digital tokens and other Layer 3 technologies to the Lightning Network. I believe that the Lightning Network is an excellent way to create a blockchain ecosystem that is scalable for mass adoption. Since the Lightning Network resides off-chain, its payments are instant. Different parties can also interact with each other without everything having to be approved by nodes, or a centralized entity, removing the need for intermediaries. This reduces the transaction costs associated with traditional payment systems and creates a system for decentralized interaction.
With the Lightning Network, you can build a truly peer-to-peer system that doesn’t require every part of a transaction to be broadcast and acknowledged by the network. This is a huge time saver.
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U.Today: What pitfalls might users encounter when using this technology?
Paolo Ardoino: Like any new technology, the Lightning Network still has hurdles to overcome, but it is constantly evolving and I believe we will be able to address these issues over time. Currently, I see room for improvement when it comes to routing reliability and overall liquidity. I also believe that nodes that remain online all of the time are exposed to the risk of hacking. As an industry, we can help prevent these attacks by educating users on the use of cold storage options, which are available and possible on the Lightning Network. As a technology, the Lightning Network is the path toward reducing Layer 1 congestion on the Bitcoin network over the short and medium term.
U.Today: Let’s talk about Bitfinex. What was Bitfinex’s greatest achievement of 2021?
Paolo Ardoino: As the preeminent exchange for Bitcoin trading, Bitfinex is a pioneer within the cryptocurrency ecosystem. Not only does it have the deepest levels of liquidity for the world’s biggest cryptocurrency, but it is also the place where Bitcoin whales make billion-dollar trades. With that being said, 2021 was a stellar year for Bitfinex. We surpassed many milestones and introduced new products and services that serve a variety of different users and aspects of the industry. In March of this year, we introduced Bitfinex Pay, a cryptocurrency payment gateway. This new product was our first contact with online merchants and allows them to accept payments in various cryptocurrencies. Bitfinex Pay is gradually becoming a disruptor in the payments industry by furthering the use of crypto for transactions for payments and services. We believe Bitfinex Pay is at the vanguard of the revolution in money and payments.
Another major achievement worth highlighting is the launch of Bitfinex Securities. Bitfinex Securities is disrupting the traditional exchange-trading model for securities. Unlike other cryptocurrency exchanges focusing on established corporations, Bitfinex Securities is a hub for innovative tech startups ($10 million-$500 million).
It offers traders and issuers a regulated, efficient and global solution to raise capital through tokenized company shares. The platform is truly disruptive.
U.Today: What are your biggest plans for 2022?
Paolo Ardoino: I see tremendous potential for blockchain-based technologies to disrupt the incumbent securities and exchange model. With this in mind, Bitfinex Securities will be a focus for sure in 2022. We’re witnessing incredible innovation in the fintech and digital token space, and Bitfinex Securities will provide a means of raising capital for tech businesses that may be somewhat excluded from access to capital in traditional financial markets. This is the USP of Bitfinex Securities: enabling innovative tech companies to thrive and build. It is also a reason why we’re so excited about the platform going into 2022.
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