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Kevin, founder of UXUY: Stablecoins are the biggest variable in the Bitcoin ecosystem.

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The current $126 billion stablecoin market operates completely outside of the Bitcoin network, but Taproot Assets will bring about a change.

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Source: UXUY

Recently, I have participated in many Bitcoin Layer2 panels, and everyone is discussing how to move Ethereum's smart contracts and ecosystem projects to Bitcoin. My idea is a bit different - Ethereum's success is due to its specific environment, community, and opportunities, and history will not simply repeat itself. In my opinion, the first round of explosion of the Bitcoin Taproot Assets protocol is likely to occur in the stablecoin field.

Convert US dollars into Bitcoin

The reason why Lightning Labs launched Taproot Assets is to "Bitcoinize the US dollar". As Stark, the founder of the Lightning Network, said:

Taproot Assets helps Bitcoin in multiple ways, including enabling people to use Bitcoin through stablecoins and easily exchange assets. This is particularly useful in high inflation environments where many people around the world live in economies where their currency is constantly devaluing. Therefore, Taproot Assets helps promote the development of stablecoins to Bitcoin. Additionally, because Taproot Assets uses Bitcoin liquidity to route assets issued on the protocol, there will be greater demand for Bitcoin on the Lightning Network. Bitcoin will replace the dollar, stablecoins, and everything in between. This is how we will Bitcoinize the dollar.

In many third world countries, a silent revolution has already begun. Countries in Africa and Latin America such as El Salvador, Mozambique, Brazil, Nigeria, and Senegal have started using the Bitcoin Lightning Network. Since the financial systems in these countries have not yet been covered by banks, Lightning Network payments have been widely accepted. Due to the frequent price fluctuations of Bitcoin, the demand for stablecoins built on the Bitcoin Lightning Network is becoming increasingly urgent.

The stablecoin of Lightning Network will not only meet the payment needs in real life scenarios, but also provide new opportunities and convenience for cryptocurrency trading.

Multi-form Stablecoin

Stablecoins are a critical part of the ecosystem in the encryption industry, and competition between various projects is ongoing. Recently, the market capitalization of USDT reached a historical high of $87.5B, accounting for 69.33% of the stablecoin market share. With Bitcoin entering the "multi-asset era," as a dominant player in the cryptocurrency market with a share of over 50%, issuing stablecoins on the Bitcoin network will become a highly contested area.

Currently, TRON occupies nearly half of the USDT market share, and the development of stablecoins on the Bitcoin network is bound to cause a major migration of stablecoin market share in the cryptocurrency world.

Most people tend to equate Lightning Network-based stablecoins with USDC, USDT, and TUSD, but in my opinion, this is a trend that has yet to be realized. With the new starting line of Lightning Network Taproot, any institution can issue stablecoins. Whether the solution comes from synthetic assets, algorithmic stablecoins, over-collateralized stablecoins, or 1:1 mapping stablecoins, remains unknown.

UXUY Focuses on Stablecoin Opportunities

The current opportunity comes from deep involvement in the Lightning Network community, comprehensively tracking all stablecoin solutions, and actively assisting or participating in the establishment of stablecoin standards. UXUY has exclusively created uPool, a service for multi-chain channels, whose core is to enable stablecoins to play a more active role in cross-chain transactions. We are also willing to provide this innovative solution to the Lightning Network and other Bitcoin Layer2 networks.

As of November 17, 2023, the capacity of the Bitcoin Lightning Network is 5,362.12 BTC, worth $0.19 B. UXUY predicts that with the official launch of Taproot Assets on the Lightning Network, the scale of stablecoins will quickly surpass this number, driving the capacity of the Bitcoin Lightning Network to continue to increase. It even envisions a Defi Summer on Bitcoin similar to that of Ethereum in 2020.

Taproot Assets and Emerging Assets

Taproot Assets has launched Bitcoin, which greatly consolidates Bitcoin's position as the native digital currency and value transfer protocol of the Internet, and brings more diverse application scenarios to the Bitcoin network. With the natural advantage of decentralization relying on Bitcoin, the cryptocurrency market is gradually shifting towards DEX.

In addition, due to the good compatibility of the Taproot Assets protocol with Bitcoin development tools, project developers will find it more convenient to issue and create new assets on the Bitcoin network. For traders, the abundant liquidity of Bitcoin, coupled with the high security, low transaction costs, and fast transaction features of the Lightning Network, makes it more convenient to capture valuable projects with great potential for innovation and development.

I strongly feel that the Bitcoin ecosystem will usher in a new round of growth, and the Bitcoin network has officially entered the era of multi-assets.

UXUY is doing what?

UXUY, as the next-generation decentralized multi-chain trading platform, is fully committed to the Bitcoin ecosystem: fully integrating with the Bitcoin Lightning Network nodes, becoming the world's first DEX to implement Lightning Network nodes; announcing full integration with Bitcoin Taproot Assets; officially launching the Universe service for developers; releasing Lightning Address service, becoming the world's first DEX to support Lightning Address...UXUY is fully prepared for the launch of Taproot Assets on the Lightning Network.

We have observed the Muun wallet, which uses both Bitcoin and Lightning Network to process transactions. Unfortunately, users are charged high fees, and when the Mempool is congested, Muun generates extremely high transaction costs that will be borne by the users.

UXUY is actively exploring the advantages of Ethereum and BNB Chain to create more efficient and cost-effective solutions for making transactions based on Lightning Network and future Taproot Assets more convenient.

Just as Satoshi Nakamoto envisioned in the whitepaper written fifteen years ago, Bitcoin is a peer-to-peer cash transaction system. The widespread adoption of stablecoins on Bitcoin will drive it back to its original intention according to Nakamoto.

Currently, the total market size of stablecoins is $126B, and it does not run on Bitcoin at all. In five years, when we look back at this data, we will get a completely new answer, which is the biggest variable in the Bitcoin ecosystem in the next five years.

This is the challenge of UXUY, and also the opportunity of UXUY.