Cuy Sheffield, head of crypto at credit card giant Visa, believes that Bitcoin Sats is an Internet local account unit with a purchasing power of less than 1 cent. He sees this as a major use case where Bitcoin, a leading asset, can replace fiat assets.
Sats, Internet local micropayment standards
Now, if I only pay 1 cent each time, I might completely turn off the mental transaction cost calculator in my head, like every post, knowing that I only spend $ 3 per month. This is where micropayment opportunities exist!
Bitcoin uniquely has a native account unit called "sat", which currently represents 1sat = 1/100 cents, while BTC is $ 10,000. The "sats" brand is far from being a mainstream brand, but it may already represent the most valuable global accounting unit, representing less than 1 cent.
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Cuy Sheffield has been thinking about Bitcoin and cryptocurrencies. Stimulated by a recent tweet posted by Coinbase CEO Brian Armstrong, he embarked on a tweet storm that offered a positive view of Bitcoin's ability to use the Lightning Network for micropayments.
As Sheffield points out, for less than $ 1, you can't buy anything online. Sheffield offers an interesting case for users who want to spend Bitcoin, even with its volatility and exponential growth. This use case is for making small payments that cannot be done in dollars.
If streaming currency becomes the way to pay content creators in the next 5-10 years, we may see Internet users who do not know or care about Bitcoin are still using Sats (Satoshis) to pay for online content. Things like streaming videos, reading online articles or listening to music can cost a little Satoshi.
Sheffield believes that because the payment amount may be as small as 0.01 cents, users will not buy or spend because the payment amount is too small. Even if the volatility is high, they can still make small payments without much difference in purchasing power.
U.S. dollar denominated micro wallets using Bitcoin behind the scenes
These wallets can still be denominated in U.S. dollars, while Sats is a unit of account for small purchases (less than one cent). The open source nature of Bitcoin development offers revolutionary opportunities for new applications in this particular area.
These apps may exceed the U.S. dollar because the U.S. government will need to create a brand new account unit that developers must adopt globally.
He believes that because the amount involved is so small, the psychological transaction costs of making such a small amount of purchases will not cause a drastic change in online behavior, as it is priced in cents.
Although Lightning Network is still in its infancy, it is still the most feasible second-tier Bitcoin expansion solution in the crypto market. The technology still has a considerable learning curve and obvious limitations, but consumer-oriented applications (making it easy to use for non-technical types) may be a catalyst to push micropayments into the mainstream.