Why this Mediterranean city is adopting the Bitcoin Lightning Network

Are you interested in bitcoin at all? Alright, Peter Schiff. So you know, if you ask your mum nicely, Noble should buy you an ice cream with bitcoin. Do you think they like digital currencies? I don't know.

Hi, my name's Chris and I love bitcoin.

I initially wanted to visit Gibraltar to.

Find out if Binance would open an.

Office here as another entry point to Europe. Long story short, they are. I also wanted to explore bitcoin adoption.

On the Rock as it's known locally.

In particular, I wanted to see how the Lightning Network, a layer two payment solution built on Bitcoin, was being accepted in Gibraltar shops.

Hello, it's Joe from Cointelegraph. I am speaking today to people on the streets of Gibraltar about bitcoin and cryptocurrency adoption to see what the vibe is. Hi there mate. Do you know what this is on my T shirt?

Yeah, Bitcoin.

Do you want to talk about it? Yeah. Okay. He knew what bitcoin is. Do you know what that is? The B?

No.

So you guys know what this is, right? I know what bitcoin is. I've also had bitcoin. So you're thinking about maybe buying some more? It could be in the future, but right now I'm like saving up for some other stuffs. 28, she's 25. They live for so long. They live same as us, 60 to 80 years average.

No way.

What type of breed is it? They're actually Triton Cockatoos. Triton. Part of the sulphur crusted family. Wow, okay. Do you think they like digital currencies? I don't know.

Oh.

Can you tell me what this is?

I don't know.

You don't know? How about your brother coin? A coin? Yeah. What kind of coin?

A bitcoin.

Bitcoin. Bitcoin. Have you heard of bitcoin before?

Yeah.

Yeah. What do you know about bitcoin? So bitcoin is a currency which has no ruler, no creator and it can be used all around the world. So, you know, if you ask your mum nicely, Nobel should buy you an ice cream with her with bitcoin. So do you have any of these things?

Yeah, I do, yeah.

What can you tell me about bitcoin?

It's just decentralized finance, I guess. Safer there than in the bank, I guess.

Are you Gibraltarian?

Yeah, I am.

Okay, so you're born. Raised here, yeah. And what do you think the approach is to bitcoin in Gibraltar?

I think everyone's a bit like scared like family members and stuff like, oh, crypto. Like it's a bit scary kind of thing. But it is what it is. Like the world is moving faster and faster every time.

Have you heard of the news in Gibraltar recently that, you know, Costa Coffee accepts bitcoin? This big bitcoin company companies here as well.

Yeah, I saw your tweet and it's just like, wow, it's mind blowing.

You saw my tweet? Yeah. Am I famous in Gibraltar?

Yeah, you're famous.

Bentley. I've heard that before, actually. It's Bentley. It's not Bentley, you know, it's a bitcoin. How do you know it's a bitcoin?

Because it's got all those weird numbers on it.

The weird numbers, all this. Abc. Okay, where have you seen that before?

On the tv.

On tv. Do you remember which program or cartoon it was?

How's it Squidward? Okay.

Amazing. But you two didn't recognize it?

Nope.

Not at all.

That's amazing. Just goes to show, right?

She's on the Internet.

Okay.

So how does it work?

So it's a decentralized currency, which means that basically there's no like central bank or no big figure behind it all. It was code that was written and it became valuable over time. So at one point in 2010, 2011, it was worth $1. Now it's worth. Oh, do you know how much it's worth worth?

Do you know how much you want to go for?

A hazard, a guess? $40. $40. Okay, so now one bitcoin is worth about $22,000 today.

What?

$22,000.

For example, I buy 100 pounds of bitcoin bits y. And then, then what do I do? Leave it there?

Yes, you take custody of it, which means that you actually you don't own it, but you own the keys to access it.

So no one can touch those. That £100 worth.

Exactly. Yeah.

Okay.

And then the idea is that it accrues value over time, which it.

And then I can sell it like a stocks and shares.

Ah, that's the amazing thing is that one day you won't actually have to sell your bitcoin. You'll be able to use it like it Costa coffee to buy your coffee or maybe to buy a car or a house or anything else.

And you've seen a difference.

I love that you don't trust me. I'm wearing the T shirt.

He's local, he will tell me.

No, I would do the same. It's going to tell you look different.

Did you want to get.

Did you want to get some?

I might buy some. But if I buy it here, can I only use it here or I can use it anywhere in the world?

It's global.

Global.

Global.

Yeah, good idea.

We'll put it in her name.

I won't be in my name.

That is the right answer. Put it in her name. Don't forget about it. It's generational wealth.

Hi.

Do you know what this is on my T shirt?

It's Bitcoin.

That was quick.

Straight in there. Presumably that means you might have some.

Bitcoin, like a decentralized digital currency.

Smashed it. Wow. Okay. How long have you known about bitcoin?

For about four or five years.

Okay, nice. Yeah. Have you been buying for that long as well? You don't have to say that actually. That's very personal investment things.

But I would say at first I was a bit skeptical I think as everyone is. But maybe the last couple of years I've dabbled with it and stuff like that.

Oh, nice. Okay. Oh, cool. That's amazing. I mean, do you live in Gibraltar?

I do now, yeah.

But you sound like you're from Liverpool. Yeah, English originally.

Right, okay.

Lock me up, officer. Okay, well. And so what do you think of the bitcoin sort of vibe in Gibraltar? Do you think people are quite open to it?

I do. I think a lot of businesses have started opening in jib. We got a lot of exchanges. We've got Etoro.

I know that.

We've had a few crypto only exchanges as well, like Bitso and Zapo bank, which is just.

I wonder. I wonder why I'm stood here. Not that I'm shilling them, but you know. Oh, cool. Okay. And did you know that at Costa Coffee, a couple of other retailers, a merchants even, they are accepting Bitcoin over Lightning as well. Have you ever used the Lightning Network before?

I have never.

Okay, well, I'll have to send you some. My phone's currently recording. Yeah, but I'll send you some sats over Lightning and you can see how it works.

Perfect.

It'll blow your mind. What's your name?

Sorry?

Laura. Joe. Lovely to meet you. Pleasure. Cool.

Remember that bank I was stood in front of, Zapobank. Well, I interviewed them because they custody Bitcoin for customers all around the world.

And so just to go back to the advantages of being based in Gibraltar, what does that mean? Being a crypto or a bitcoin native in your case Bank, I think that.

If you speak, it's not really even directly relevant to Gibraltar. Any country in the world. If you want to have an interactive discussion with a set of policymakers, regulatory authorities, government representatives, finance center or equivalent, whatever that means, it's extremely difficult to have those conversations round the table. And for them to be, like, agreed on a single path or set of steps that need to happen. But. But here it is possible because everyone's.

Within a stone's throw of one another.

Everyone's within a stone's throw. Plus, you know, there's also, like, we've been doing it for so long and the starting points were very, very difficult. People asking ridiculous questions and not understanding anything, including any regulators. They start to learn about something, they're sort of getting to grips with what it is. Whilst here, the regulator has been dealing, supervising, monitoring this activity since 2017 or whatever it was, and they're just at a completely different level, the things that they're talking about, and that's really, really, really advantageous.

I'm sure you're familiar with Coin Corner in the Isle of Man, they're big on the retail side of things. Merchant adoption in Gibraltar, it seems like it's much bigger on the sort of. I don't want to call it custody, but, you know, the idea of bitcoin savings here instead. Is that a fair summation? Firstly, and what do you make of these strides that have been made into merchant adoption in Gibraltar recently? You know, there's now Costa Coffee accepting Bitcoin, Hotel Chocolat, there's a couple of bakeries. Apparently there's a few jewelers as well.

Yeah, yeah. I mean, I think we didn't start out like, in Gibraltar PLC didn't start out with the idea of, like, this is a particular application or sector that we want to build this for. We said we want to set a very high standard, the gaming example. So online gaming, massive here, right? Massive. Biggest in the world. The process that we went through in the gaming universe is kind of what we went through in the crypto ecosystem, saying, well, we don't want to have 800 licensed gaming platforms here. We only wanted. I think there are 25 now in total. But it's the big names for a population of 30,000. It's a very big. It's a very, very big names. And the crypto space, it was the same. So it's very difficult for small merchant platforms. It's very difficult. But I'm not convinced that retailers in Gibraltar or the UK are going to suddenly start accepting. BTC is a payment layer. I mean, look, it's a stage of development and if they start doing that and then lightning gets the traction that can get, could that become relevant to certain other internalized sort of payment networks or mechanism? Possibly, but it's not. Personally just for me, I don't really see BTC as like a day to day medium of exchange. You see it more as like a storage of value. Yeah, it's, but, but it's application use and all these different things that happening. I think it's great to have it explored and developed. Exactly.

For every, every different person it's, you know, a different thing.

I'm never going to say that's wrong and you've got it wrong, but I'm never going to say this is great. Now you know GBP and USD are going to evaporate because. Not quite. Not quite there.

After speaking with the bitcoin bank, the next logical step was to go one rung up the financial ladder. So here I am talking to the Minister of Digital and Financial Services about Bitcoin and crypto in Gibraltar. It turns out that Albert Isola is a Hodler.

Hello, my name is Joe hall with cointelegraph. I'm here today with Albert Isola. Albert, how are you doing today?

I'm good, thank you. Very nice to see you and welcome to Gibraltar.

I'm here at the moment because there's been certain retail and merchant adoption waves in the bitcoin space and similarly Zapo, which is at one point it was one of the largest custodians of bitcoin in the world. I think I need to double check that fact, but I'm pretty confident is based in Gibraltar and they saw it as one of the safest, securest places to secure that Bitcoin. Does the regulator see bitcoin as separate to crypto or to separate, separate to other DLTs or is it all sort of under the same umbrella?

I think we regulate the businesses that hold these digital assets or digital stores of value. And so we want to do is control the people that touch them because if they are touching them for you by way of business, we want to make sure they're doing things properly and that they know what they're doing, they have a viable business plan, they have capital in the bank to ensure that they're able to get out of a problem if things go bad. So all of those things is the global picture and provided they comply with what we require them to do from a regulatory perspective, then the rest is really up to them. So when you talk about adoption of the use of bitcoin, is it going to come? Yes, it is more and more as more and more jurisdictions begin to regulate. And what is for me, the ideal? The ideal is when there are enough countries doing it and we have an international standard regulation where everyone has to comply with, then it'll be enormous, in my view.

And what about you personally? Would you spend your bitcoin? I mean, do you have bitcoin first?

Do you have bitcoin?

You do have Bitcoin? And would you spend it. Would you spend it at, say, one of the Costa Coffees that's now accepting Bitcoin here on the street of Gibraltar?

I'm not at the stage yet where for me, it's something that I would use at a regular basis. It's more of buying some for the benefit of my kids in years to come. And I don't touch it.

Okay. So it's more the generational wealth category.

It's just something that's. It's fun. I think people have to put the amount of money into it that you can afford to lose because you never know what's going to happen, like with anything new. But I am impressed by its resilience. Even during this last hit, it's held itself remarkably well. Has it taken a big drop? Yes, but look at the rest of the financial services market. That's taken a hell of a drop, too.

Yes.

So I think that. I think it's demonstrated a level of resilience that I didn't expect it to have. So I think we'll see it back up shortly.

So can I buy you a coffee later over Bitcoin?

Yeah, with pleasure.

Unfortunately, I didn't get to see the minister later. Instead I ran into Neil Walker, managing director for Sandpiper Gibraltar. They run the Costa Coffee franchises in Jib.

Hi, Neil.

Hi, Jake.

How are you doing today?

Good.

So why are we sat here in front of a Costa Coffee in Gibraltar?

I'm a retailer. I run shops and cafes in Gibraltar. I just happened, I guess, a little while ago to find Bitcoin and see everything that's happened on the Lightning Network. And I thought, you know, look at this. People are using mobile technology more and more and more. And the natural next step looks to me like enabling the Lightning Network in our stores.

How many places are there currently accepting Bitcoin over Lightning in Gibraltar?

For us, there's seven. But we're not the only ones accepting Bitcoin in Gibraltar. There are other retailers who were accepting it before me. It's at least half a dozen places on top. So I think we're probably Getting up to 12, 13, 14 places in Gibraltar that accept it.

What is it with these British overseas territories and running with Bitcoin?

This is about mobile payments and making things easier. The Lightning Network is once you get over the first hurdle of understanding how to send it QR code or via address or whatever it is, it is so simple and easy and so quick. I believe it's going to be the payment network of the future, which is why I brought it into Gibraltar. And we'll just have to see what happens.

And final question, why Bitcoin over lightning? Why not say dogecoin Elon Musk likes that. It's really quick as well, isn't it?

Well, where is the adoption? When you look at the Lightning Network and you have Strike Cashapp, you have grassroots movements that have gone from being Bitcoin beach started as a grassroots movement in one village and now El Salvador have adopted the Bitcoin and Lightning network. Across the whole country you've got multiple EPoS providers, the till providers, integrating Lightning Network payments into the till. So I mean, for me it's about the network and the adoption. And for the Lightning Network, I think that it's exponentially growing and we'll get there so that soon, you know, in most places, whether you know it or not, you can be using the Lightning Network to pay. To pay for your purchases.

Gibraltar to Bitcoin Rock.

Bitcoin Rock.

Come over, spend some sats.

Exactly.

Prices bitcoin this year sub 30k. Borat yacht club by yourself. Get a bit angry. I think about to walk to Spain this bridge was £1,000,000. Should have bought bitcoin.