Lightning Labs: Stablecoins may appear on the Bitcoin network

Lightning Labs is preparing to launch stablecoins and other tokenized assets on the Bitcoin (BTC) blockchain.

Elizabeth Stark, CEO of Lightning Labs, announced the company's plans during a keynote at the FT Live Crypto and Digital Assets Summit in London.

Lightning Labs presented a plan to integrate stablecoins into the Bitcoin network

Stark revealed that the Lightning Labs development team has already begun preliminary testing of the new protocol on the Lightning Network.

Stablecoins and tokenized assets typically face high fees and scalability issues on other blockchains. Stark noted that the Bitcoin network is ideal for these challenges due to its security and decentralized nature.

The initiative will be rolled out through a Taproot update that supports complex contracts and broad use cases. In October 2023, the company launched an alpha version of the Taproot Assets protocol on the mainnet. This action allowed the issuance of stablecoins on the BTC blockchain.

Stark emphasized the growing role of stablecoins in regions suffering from economic instability, high inflation or falling fiat currencies.

Stark recalled that Tether (USDT) and Circle (USDC) now hold more US Treasury bonds than many large countries. She stated that the security and stability of these digital assets are invaluable and pointed out the benefits of using the Lightning Network for transactions using them.

The CEO of Lightning Labs detailed the company's role in the evolving ecosystem of digital assets and
explained that the infrastructure it is developing will allow other financial institutions to issue tokenized real-world assets (RWA), including gold and fiat-backed instruments.

Integrating stablecoins and other assets into the Bitcoin network will help significantly increase the number of use cases, expanding the influence of BTC in the financial world.