Galoy, the developers behind the well-known Bitcoin Beach Wallet, are working on a feature that allows the use of a US dollar figure in the Lightning Network – so to speak, on a BTC stablecoin. The project called Stablesats thus enables the direct exchange of satoshis to US dollars.
What are Stablesats?
Galoy refers to his stablesats as synthetic US dollars with Bitcoin deposit. However, a designation as a token or stablecoin is rejected – for understandable reasons.
In contrast to common variants such as Tether, everything takes place on the basis of Bitcoin. So technically, no own token is created.
We’re excited to share two announcements:
1) We raised $4M to further bitcoin-native banking infrastructure.
2) We’re releasing Stablesats – a feature to hold and transact dollars over Lightning without the use of stablecoins or fiat integration.https://t.co/OlJAyufLju
– Galoy (@GaloyMoney) August 3, 2022
Stablesats-enabled Lightning wallets allow users to send, receive and hold money in the form of US dollars in addition to their standard BTC account.
Explains Nicolas Burtey, Managing Director of Galoy. The use of stablecoins is to be curbed by this alternative.
While the dollar value of your BTC account fluctuates, 1 dollar remains 1 dollar in your USD account regardless of the Bitcoin rate.
However, Galoy is not the only company working on the realization of such an idea. In April, Bitcoin2Go reported on Taro. The protocol is created through the cooperation of developers from Synonym, Omni and OmniBOLT companies.
Taro pursues the same goal as Galoy’s Stablesats: to bring a stable US dollar figure on Lightning to the users.
Lightning Network Taro: Stablecoins Return to Bitcoin
With Taro, stablecoins should return to the Bitcoin mainnet thanks to the Lightning Network. The developers hope for a complete reinterpretation of Bitcoin.
Bitcoin Beach Wallet Developer Partners with OKX
To implement the US dollar figure, the Bitcoin Beach Wallet developer cooperates with the crypto exchange OKX (better known under the previous name OKEx).
Due to derivatives on OKX, the value of the stablesats remains stable despite unrealized losses or gains of the Bitcoin. Such functions are highly sought after, especially in developing countries.
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Nevertheless, stablesats also have disadvantages. In fact, by using them, the user waives the self-management of Bitcoin. Instead, it manages a centralized crypto exchange with OKX.
In this case, the usual dangers also occur, which can even mean a loss of digital assets. An embezzlement is conceivable, for example, as in the case of Mt.Gox. The notorious crypto exchange is back in the headlines because of new developments.
Galoy receives four million US dollars in funding
At the same time, Galoy announces that it has received four million US dollars in financing from various donors.
These funds will be used to continue the work on GaloyMoney. As a result, the company hopes for growing Lightning adoption. The project is described as follows:
The open-source GaloyMoney platform includes a secure backend API, mobile wallets, point-of-sale applications, an accounting function and administrative controls.
GaloyMoney is intended to bridge the gap between traditional banking and modern digital means of payment.
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