At the end of last week Blockstream, who developed Liquid Network as a Sidechain for traders, announced the arrival of 10 new members in the Liquid Foundation. From all those 10 members you might know one of them : Ledger, a french society specialized in hardware wallet. You probably asking how is this a huge partnership ? Well, let me drive you through this revolutionary idea.
If you really aware of all news related to Bitcoin you might know the scalability issues endured by this cryptocurrency. Indeed it is a slow and expensive process, especially when the number of users peaks, this is where Blockstream operates.
1. Let's start with what is Blockstream and what are they doing :
Blockstream is a huge society who develop technologies around Bitcoin and blockchain, they are actually the leaders in this kind of services. One of their project generated what we call a Sidechain, it is a blockchain which works in conjunction with Bitcoin's blockchain. This Sidechain is mainly what allows transactions and exchanges within the Bitcoin's blockchain.
From this Sidechain technology was created the Liquid Network, a sidechain-based platform for exchanges and trades, allowing quick and secure transactions between the different users. It also provides issuance of digital assets, to sum up this network is essential in order to facilitate and speed up transactions around Bitcoin and also in terms of confidentiality.
2. So what is the objective of this partnerships between Ledger and Liquid Network :
Well like stated the Ledger enterprise, this partnership aims to build an efficient infrastructure which allow to improve the user's experience.
"We have decided to join Liquid Network because we believe it is the best way to exchange Bitcoin in terms of security and decentralization today" said Ledger's co-founder Nicolas Bacca.
But how does this work ? Well Ledger wish to allow access to a user to Liquid Network through their Application SETTLENET directly from his Hardware Wallet and remaining in control of its security keys and funds.
The project is ambitious because you have to remind that an hardware wallet is an offline wallet, it means you can't access it with an internet connection (it is an efficient way to protect your funds from hackers). As I was saying this wallet is offline, so you can't trade, exchange or negotiate your funds, Ledger's partnership want to resolve this and allow these services just by being linked to Liquid Network.
3. How is this a huge change for the hardware wallet in the cryptocurrency world :
"SETTLENET will allow users to trade cryptocurrencies sides to Liquid Network (which is in conjunction with Bitcoin's blockchain) regardless the counterparts risks" stated Justin Dhingra.
It means a user will be able to trade from their hardware wallet thanks to Liquid Network and still have the advantages offered by an hardware wallet, security and confidentiality for examples. A Cold wallet is an hardware wallet (not accessible through internet, so more secure), as opposition a Hot wallet is a platform like Kraken or Coinbase who are link to internet, it means Hot wallets are more likely to be hacked.
Now imagine being able to trade your crypto without worrying about security and confidentiality risks, it is a massive change concerning our cryptocurrency Wallets ! According to what Ledger and Liquid Network stated the Application SETTLENET will be officially launch in late June 2020.
As a conclusion, I think this ambitious partnership could well boost the decentralized finance ecosystem of Bitcoin in the future, offering more security and privacy around cryptocurrency.
