This voucher is based on free software and is designed to distribute and share tips with people using the Bitcoin Lightning Network. In short, here’s what you need to do:
- If you already have a Bitcoin Lightning Network wallet installed, simply scan the front-side QR code with your wallet to instantly claim the tips stored there.
- If you don’t have a wallet yet, scan the same front-side QR code with your phone’s camera and read the instructions on which wallets you can install. Then, after installing the wallet, scan the QR code by a wallet app on the front side again to claim the tips. I recommend the Wallet of Satoshi or Blink wallets.
- If you’ve already installed a wallet and claimed the tips, read the text below to learn what Bitcoin is, how to use it, and where you can spend it.
- If you’re so lazy that you don’t even want to spend a couple of minutes to claim the tips, that’s fine – after some time I will simply take them back myself.
Bitcoin was invented in 2009 by an anonymous creator who chose the pseudonym Satoshi Nakamoto. This person set a goal to invent electronic money that could not be controlled by governments, that would give financial freedom to people around the world. This person managed to combine various cryptographic technologies known at the time into one whole so that he was able to solve the fundamental task of how to transfer value over the internet without a single central authority.
But in addition to solving such a complex task as transferring value over the internet without any central authority, he created this virtual currency in such a way that it has a limited emission — that is, issuance of new coins. Bitcoin has a built-in minting machine for new coins, which are paid to miners. And miners are people or companies who verify all Bitcoin transactions, put them into virtual blocks, which are chained together using cryptography. And for this, miners receive rewards in the form of newly minted bitcoins. This minting machine reduces the issuance volume exactly by half every 4 years. And so every 4 years. As a result, in 100 years the issuance of new bitcoins will completely stop, and miners will be paid solely from the transaction fees that users pay when transferring Bitcoin. The technology is designed in such a way that miners cannot cheat or deceive, because all links of the Bitcoin chain, all nodes of the Bitcoin network verify the work of the miners and do not let any fraud pass further.
Despite the fact that in one hundred years the minting of new bitcoins will completely stop, at the moment more than 90% of all bitcoins that will ever exist have already been issued. As a result, if people use Bitcoin in everyday transactions or for saving, then according to market laws, the current mass of bitcoins that already exists will be distributed among all the people and companies that wish to store it, own it, and use it as money. And by market laws, as a result, the price of Bitcoin will constantly grow over time. The more companies and people use Bitcoin, the higher its price will be — but the more expensive it becomes, the slower it will grow. In any case, if you are thinking about saving in Bitcoin, this is a more profitable option than saving in regular fiat money, such as the dollar. Remember that regular government-issued money is always subject to inflation because governments over time always succumb to the temptation to print more money to solve some short-term problems in their economy. And the more money is printed, the more expensive goods become in that currency, because the money supply inflates and inflates, while the quantity of goods and services doesn’t grow as fast. Bitcoin in this sense is the complete opposite.
Many people mistakenly think that to own Bitcoin, they need to buy at least one whole Bitcoin, which currently costs over $110,000. But this is a deep misconception. The point is that Bitcoin is designed to be divisible up to eight decimal places. To be precise, the protocol doesn’t operate in Bitcoin units, but in its smallest part, which the community has named after its creator — Satoshi. 100 million satoshis is one Bitcoin. But because Bitcoin is currently very expensive, it is recommended to use satoshi units in everyday calculations. For example, at the moment I am writing this text, one US dollar equals 846 satoshis (“sats”).
Let me now explain the difference between Bitcoin and Bitcoin Lightning.
Bitcoin itself is a reliable technology for sending and storing Bitcoin, but it has a downside — all payments do not go through instantly; they wait to be included in a cryptographic block by miners. This usually takes time — 10 minutes, maybe 20 or an hour. And you need to pay a fee for this, which can sometimes be one dollar or more. For this reason, in 2018 an additional technology called Bitcoin Lightning was invented, which works on a higher level above the basic Bitcoin and allows microtransactions with almost zero fees. This is exactly how I sent you the tips to your wallet.
To put it simply:
Regular Bitcoin (called “Bitcoin on-chain”) is great for long-term storage and transferring large amounts.
The Bitcoin Lightning Network is better suited for everyday small transactions (but you can transfer large amounts too).
Bitcoin on-chain can be stored offline, without a device connected to the internet.
For Lightning payments, wallets must be connected to the internet, whether it’s an app or a computer program.
Because of this, custodial wallets are more convenient for Bitcoin Lightning, since the technical part is handled by the company that created the wallet. It may seem like this creates the same problem as with banks — that the custodial company becomes like a bank. And in part, that’s true. But any technically knowledgeable person can run their own Bitcoin Lightning node and set up a personal payment system for themselves and their family, connecting their wallets to it and becoming their own kind of bank. In the banking system, you cannot do this yourself.
For Bitcoin on-chain it’s even easier. There are many wallets you can install, send Bitcoin to them, write down the secret seed phrase, and store your Bitcoin for a long time without worry.
Some economists have calculated that if the same amount of capital invested in gold were invested in Bitcoin, the price of one Bitcoin would be about $350,000. And if the U.S. economy were invested into Bitcoin, its price would exceed $1,000,000.
Imagine that Bitcoin is a global digital currency that’s easy to transfer, censorship-resistant, and cannot be blocked by banks. Imagine how many people could use it for payments with one another. If you picture all that, it’s easy to guess that the price will become very high over time. But even if that doesn’t happen very soon, saving in Bitcoin is still a far better deal with yourself than holding your money in cash or in a bank account. Government money will never appreciate the same way — because that would require governments to reduce the amount of printed money and make their currencies global, which isn’t possible due to the nature of states.
Now let me tell you about Bitcoin wallets.
All Bitcoin wallets are either apps, computer programs, or hardware devices that operate with keys and sign Bitcoin transactions. There are two classes of wallets.
The first class is self-custodial. This means the person is their own custodian of their bitcoins. Strictly speaking, wallets don’t store bitcoins, they store private keys to Bitcoin addresses. The bitcoins themselves are stored in the global blockchain database, which is stored on every Bitcoin node computer. There are tens or hundreds of thousands of such nodes around the world. These wallets connect to those databases and retrieve balance info for the addresses owned by the user’s wallet.
The second class of wallets is custodial, where your bitcoins (the keys to addresses) are held by a third party, such as the company that made the app. Of course, the best way to store your Bitcoin is using self-custodial wallets. But as always, security and convenience require trade-offs. Self-custodial wallets are a bit harder to manage. When one person wants to introduce another to Bitcoin, probably the easiest way is to use custodial wallets, because they allow you to start using Bitcoin very quickly and easily. That’s why I recommended that you install a custodial wallet. For example: Blink Wallet or Wallet of Satoshi. The first is made by a Salvadoran company and is very popular in El Salvador — a country that adopted Bitcoin as legal tender. The second is an Australian company — a pioneer in the Lightning Network.
When you received your tip, you may have immediately wondered how to convert it into cash.
Yes, that’s possible — but I would recommend that you hold onto the tip in your wallet. When you meet other tourists, you can offer to accept tips from them via Bitcoin Lightning as well.
However, if you don’t want to keep and accumulate Bitcoin, and want to cash out instead, here are some ways to do it.
The simplest method — which may not always work — is to try to find someone among your colleagues who wants to invest some of their money, like dollars, into Bitcoin. In that case, you can sell them your Bitcoin and exchange it for money. You can agree on any rate you like, and you won’t need to register anywhere or send in documents.
Another way: exchange your Bitcoin for dollars and send them to your bank account. But remember — banks charge high fees for international transfers, and exchanges also take a fee. So this is not the most preferred method. But I want you to know that the popular exchange Binance accepts Bitcoin Lightning for deposits. Inside Binance, go to the deposit section, select Bitcoin, and then select Bitcoin Lightning. You’ll need to generate a Lightning invoice — enter the amount you want to receive on Binance, then pay the invoice from your phone wallet by scanning the QR code on Binance or copying the invoice string (it starts with “lnbc…”). You can even pay with regular on-chain Bitcoin, but that will cost a bit more, since on-chain transactions are more expensive. But remember — all exchanges now follow regulatory rules and require users to submit ID to convert Bitcoin into fiat.
Another option is to spend Bitcoin directly.
For example, the site Travala.com lets you book flights and hotels and pay with Bitcoin or Lightning.
There’s also a service that lets you create a virtual bank card to pay for online purchases — like a normal debit card. The card is issued in minutes, and no ID is needed if you stay under $4,000/month.
- Limitations: online purchases only, no ATMs, can’t be added to Google Pay or Apple Pay.
- But: super easy to top up with Bitcoin Lightning.
Want to try some fun uses of Bitcoin Lightning?
- Feed real sheep and watch them live via camera. It costs about $0.50 per feeding.
- Feed real cats and watch them live — or pay a few cents to activate an animated Yoda toy.
- Pay a small amount to run a toy train, and display your message on a screen during the livestream.
In conclusion
There are thousands of websites, online stores, ATMs, restaurants, barbershops, exchanges, and more that accept Bitcoin or the Lightning Network. All of this forms a huge infrastructure that has naturally evolved over the 16 years since Bitcoin was born — spread across different countries and all usable with one global currency: Bitcoin. A currency that gives people financial freedom. That is limited in supply — deflationary. That is out of reach for governments and banks. That is protected by strong cryptography and has been tested for 16 years by the world’s best cryptographers (just imagine the temptation to find a vulnerability and steal Bitcoin — and yet no one has succeeded).
If your financial future matters to you, now is the perfect time to get to know Bitcoin better!
