SatoshiPay has announced that it will be phasing out Bitcoin, and thus Blockchain technology, as its preferred settlement network. Instead, they are partnering with the IOTA Foundation due to faster transactions with much lower fees.
Bitcoin has been the original Blockchain technology on which a number of businesses have built their services on. SatoshiPay is just one of those companies to use Blockchain technology, but they are now looking beyond that to a microtransaction Blockchain-less crypto token called IOTA.
SatoshiPay began using Bitcoin in 2015 as a system to settle these micropayments, and back then it was a viable option as fees for Bitcoin transactions were around $0.02. However, recent congestion on the Bitcoin Blockchain, from an increase in interest, has sent fees skyrocketing towards an average of $3, and up to $5 at times.
SatoshiPay will now be relying on the IOTA network for its micro payments as it believes this is a superior technology for its services.
The IOTA network is the eighth biggest cryptocurrency in the total value of its supply, but most importantly, it is a technology that boasts almost zero-fee transactions. It also has no limit as to the amount of transactions it can process per second.
The IOTA protocol runs off of Tangle, which has similar functionality to a Blockchain yet acts more like an emulated version giving it more versatility. Tangle’s representation is an acyclic graph, which has an order yet can go in any finite partial order represented by the original structure.
In describing IOTA, the co founder, David Sønstebø put it thusly:
“IOTA is a decentralized, very lightweight micro-transaction token that is optimized for the Internet-of-Things. It is essentially a blockless ledger without any sort of fees on transactions. ‘Money of IoT.’”
It seems that while Bitcoin was the pioneer of this new form of Blockchain technology, there have been advancements around it that have overtaken it.
Businesses looking to utilize decentralized chains and tokens now have a range of choices that have improved upon the original Bitcoin.
SatoshiPay CEO Meinhard Benn said:
“We love Bitcoin for its pioneering role in the creation of our industry, but some Blockchain networks it inspired have evolved faster than Bitcoin itself, so we decided to move on to superior technology.”
Not the first time, won’t be the last
The switch to altcoins, as well as so-called superior technology, is not new in the world of Blockchains and cryptocurrency.
There is a lot of worrying developments and discussions surrounding Bitcoin at the moment, especially about the scaling debate. These factors, coupled with the current difficulties Bitcoin is having with an influx of users, is driving away companies from their Blockchain.