Decentralized payment processing solution BTCPay has launched a new product: BTCPay Vault. The vault will serve as software that connects a BTCPay server to one’s hardware wallet, allowing one to seamlessly receive funds, but also spend the funds received on a personal server, January 22, 2019.
Permissionless Payments on Bitcoin
Bitcoin itself is a permissionless payment remittance mechanism. However, it lacks UX touchpoints that make the entire experience faster and easier. With BTCPay, merchants can set up their own servers to receive Bitcoin payments at ease. The server runs a Bitcoin full node in the background that verifies payment data.
Spending funds that came into a BTCPay server was tedious. User’s had to connect it to an Electrum server and erode their own privacy. BTCPay’s vault will fix that hiccup and improve user privacy by keeping all of the data on one’s own device. The vault will simply act as middleware that connects a user’s hardware wallet to their BTCPay client.
Centralized solutions like BitPay give end-merchants a lot more flexibility. Due to BitPay’s conversion of crypto to fiat before sending it to a merchant, the solution also has much wider traction. Bitcoin as a payment system is still infantile. Not many merchants will be willing to harbor such intense volatility along with the scrutinous regulatory requirements that come with using Bitcoin.
At the moment, the software supports most hardware wallets from Ledger and Trezor, as well as the ColdCard and KeepKey.
Peer to Peer Finance
BTCPay is a prime example of how peer-to-peer finance can evolve without giving up to centralized solutions. Nicolas Dorier started BTCPay in the midst of infighting between the big blockers and small blockers in 2017.
Micropayments are still an undeveloped frontier over Bitcoin. With the prospect of a fee market inevitable for mining sustainability, layer two solutions like Lightning are the best bet for Bitcoin to scale for mass payments.
Even with a solution like Lightning, clients like BTCPay will still be a major part of the ecosystem for facilitating a better merchant experience. In essence, more decentralized solutions like BTCPay need to be propelled to the forefront in order to better serve the community and any merchants who want to accept crypto payments.