Since our last popular science article on the security mechanisms of the Lightning Network, we've realized that not many people seem to be paying attention to what Lightning Labs is up to.
When we talk about the BTC ecosystem, most people are still following the general marketing trends. So, let's pay attention to people who are quietly building – recently, Lightning Labs' Twitter has retweeted several posts related to the L402 protocol (e.g., from fewsats). Paying attention to these truly building teams is perhaps far more important than focusing on short-term hype.
What is the L402 protocol?
We know that to create wealth in this industry, in addition to discovering new asset classes early on, we need to find new use cases. If, in the future, AI gains the ability to conduct transactions and payments on its own, what currency would be best? If you also agree that open-source and transparent Bitcoin is the most AI-friendly currency, then you will certainly agree with this use case developed by Lightning Labs.
In July 2023, Lightning Labs announced the release of a suite of new developer tools called "LangChainBitcoin" to support this emerging intersection of Bitcoin and AI. The L402 protocol forms the foundation of this. Three months later, they announced the mainnet support version v0.3 of Taproot Assets.
This set of tools allows AI agents to interact directly with Bitcoin and the Lightning Network. This means developers can now create AI agents that can hold Bitcoin balances, send and receive Bitcoin, and interact directly with Lightning Network daemons (LND) nodes, which are the software connected to the Lightning Network for Bitcoin transactions.
In simple terms, this suite of tools allows artificial intelligence to conduct transactions directly using Bitcoin. Developers can create an AI "agent" that can have its own Bitcoin wallet, send and receive Bitcoin, and interact directly with Lightning Network daemon (LND) nodes.
L402 is the technical standard for this transaction and payment interaction, enabling fast, scalable micropayments APIs globally.
What is the significance of the L402 protocol?
Your next dApp user, why must it be human? We're always talking about "bringing the next billion users into Web3." But perhaps the first to achieve mass adoption won't be Web2 human users. Maybe one day, there will be more AI addresses and machine-to-machine payment transactions on the blockchain than human ones.
A small step for AI interaction, a giant leap for AI identity. AI agents, as "individuals" without legal identity (cannot be imprisoned), cannot open bank accounts or use payment services like PayPal. However, they can gain permissionless access to human financial systems by interacting with the Lightning Network.
Micro-interactions, real-time collaboration. For machine-to-machine interactions, achieving real-time collaboration (receiving a small amount of money for a service) might mean micropayments of a few cents are the choice for AI (e.g., API calls), and the Lightning Network is global. It's important to know that global real-time micropayments are almost impossible in centralized banking systems (e.g., you can't use Visa for instant cross-border payments of $0.01). Of course, it doesn't have to be AI; automated small micropayments themselves have a lot of imaginative potential.
Recent Progress from Lightning Labs
Just yesterday, Lightning Labs retweeted posts from fewsats multiple times – a platform built on L402 (currently very early stage). Independent developers can use FewSats to upload their code, and then allow ordinary users to execute a piece of code written by them by paying with Crypto via the Lightning Network – this code could be an automation tool or a piece of software.
Simply put, as its name "Few Sats" suggests, it's a SaaS (Software as a Service) platform that allows users to pay very small amounts via the Lightning Network to execute developer software code on a per-use basis. Commercialization will be their focus.
Although not mentioned in FewSats' recent tweets, their official website prominently states: "Let your AI agents transact as smoothly as they compute." This clearly indicates that their ambition extends beyond a traditional developer SaaS platform, and it tightly aligns with the significance of L402 discussed in our previous section.
Regarding Other Information. Here is a Github repository: https://github.com/Fewsats/awesome-L402. It's a curated list of resources for L402, where you can find other projects. The repository aims to compile useful informational guides related to L402, tools, or anything considered "awesome." You can also follow updates on L402 and related projects here, or even contribute.
Finally
AI adopting Bitcoin seems to have become one of the consensuses for AI + Blockchain. If oracles are the bridge linking the real world and the blockchain, then the Lightning Network is very likely to become the bridge linking Bitcoin and artificial intelligence, serving as crucial infrastructure. Utility-wise, its market capitalization has immense upside potential. This is truly a great narrative, and it is incredibly worth looking forward to.
OneKey is the world's first hardware wallet to fully support the Lightning Network and Nostr, with a complete App support – we look forward to building the BTC ecosystem together with everyone.