Lightning Network 101

lightning network 101

Lightning Network 101

Online Game / Digital Artefacts


This is probably the most exciting or rewarding use case for bitcoin over the Lightning Network Protocol. The ability to create digital content such as characters, accessories, weapons and even complete environments already exists. Some entrepreneurs have even turned this into cash positive business ventures. Since the inception of Bitcoin, anyone is able to create a cryptographically unique piece of content.  Which on the other hand can exchange securely with another entity.

The Past

It was easy for a click farm to produce hundreds of Diablo accounts which they would then subsequently sell for a profit online. Why go through hours of grinding when you can just buy a full repped account. This was a profitable industry, yet somewhat shady. There was no thought spared for confidentiality, data protection, copyright law, title terms and conditions or even basic consumer protection. If you are the buyers and bought an “account” online, you were basically gambling. The account might get suspended, it might be a hacked account, it may have one of a hundred problems associated with it. On the seller side, the biggest issue was that a buyer could simply reverse the payment or claim fraud, resulting in sellers losing revenue and assets.

The Present

Pay and play games such as Fortnite (which is an online game) are very popular which result in many parents having to pay professionals to team up with their children. This will help to achieve wins, acquire skins and level up. Creators have revenue share deals with platforms and therefore already have a way to monetize their creativity but this is not interoperable across platforms.

Cryptokitties took the cryptocurrency space by storm during 2017. This was probably the first example of building a new industry on the blockchain. Cryptokitties are digital online collectable cats with a Tamagochi twist. In contrast, TY Inc. would simply produce physical collectables such as beanie babies in limited quantities.

The Future

Games will revolve around unique and interesting characters. Publishers will need to rely on storylines as they find new ways to engage with their audiences. Naturally, we will create secondary markets. These secondary markets could potentially be huge and dwarf the current industry market cap. Not only can you create or earn items but you can also trade them off of the platform, as you have physical ownership of the item. Furthermore, this will also result in greater interoperability between games and we will see much more emphasis multi-developer games.

For example, you could have one entity create a map, another entity create the gameplay and independents who create items, widgets etc. Creatives, who combine all these properties, almost literally let the game write its own.


The lightning network is perfectly suited to complement a major cryptocurrency based game. Higher value transactions which require more trust can be done on chain via a normal Bitcoin transaction and low-value high volume items can be done via the lightning network.

We have only explored but one example of how the lightning network can act as an online cash layer for payments. The only certaintuty is that the space is growing faster than the text can keep up with.



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