• Jack Dorsey known as a bitcoin fan
• Bitcoin should reach even more people
• Own Square business arm to enable decentralized Bitcoin exchange
The co-founder of the short message service Twitter and the payment service Square has often proven that he is a big Bitcoin enthusiast. This has now also been reflected in his company. According to MacRumors, Twitter is currently working on a Twitter update that will enable users to send Bitcoin tips. And the mobile payment service Square announced in July that it would develop its own hardware wallet for storing Bitcoins.
Decentralized Bitcoin exchange planned
Now the crypto supporter Dorsey has come up with a further step with which the oldest crypto currency should reach even more people in the world, namely its own decentralized Bitcoin exchange. With this, the Square boss concretized the payment service’s announcement from July that it wanted to expand its own crypto business unit with a focus on Bitcoin, with the cryptic name TBD.
A decentralized trading center for cryptocurrencies, also abbreviated to DEX from Decentralized Exchange, is an exchange that eliminates the need for an intermediary for transactions, trading, lending and lending money and instead enables peer-to-peer applications. The exchange uses automated smart contracts that are executed transparently and fraud-proof with the help of the blockchain.
As the name suggests, the area of Decentralized Finance (DeFi) already relies on such a system without an intermediary, which is made possible via smart contracts and the blockchain.
Buying Bitcoin is quite complicated and time-consuming.
»Here you can easily buy and sell Bitcoin
Bitcoin blockchain so far too slow and not scalable
The peculiarity in Dorsey’s plans is rather that the targeted Bitcoin trading venue should run on the Bitcoin blockchain. The Ethereum blockchain has been used in most DeFi applications so far, and with good reason: The network on which Bitcoin is based is simply too slow and not so scalable that thousands of transactions can be completed within a second. However, this would be a basic requirement for a Bitcoin exchange. The reason for this difference compared to Ethereum, for example, is that Bitcoin was designed primarily for peer-to-peer transactions. As The Motley Fool writes, this has resulted in the cyber currency being used more as a store of value than as an actual currency.
Dorsey now wants to tackle this problem with the new Square business area TBD. Incidentally, the project did not become known through Dorsey himself, but through a series of tweets from the head of the TBD business Mike Brock, which the Twitter CEO immediately retweeted:
– jack⚡️ (@jack) August 27, 2021
A big job
Brock wrote in his tweet: “We believe that Bitcoin will be the natural currency of the Internet. While there are many projects that are helping to make the Internet more decentralized, our focus is solely on a solid global monetary system for all However, to include everyone makes it necessary to fill some gaps that we are still seeing “. One such missing part is a decentralized crypto exchange that, if TBD has its way, should be based on Bitcoin “from front to back”. The platform should be “fully publicly developed, open-source, open-protocol and usable for every wallet”. A control by TBD should also be excluded.
However, Brock also points out that there is still a long way to go towards this vision and that the gaps that still exist are “perhaps too big”, so that it is also possible that other crypto blockchains will have to serve as parts.
In any case, it remains exciting to see whether Square with the TBD arm will actually succeed in making the Bitcoin blockchain faster and scalable in such a way that a decentralized Bitcoin exchange can actually go live.
Finanzen.ch editorial team