Bitcoin analysis for 12/07/2018

Cryptocurrency Exchange CoinGate launches a pilot program for 100 traders to test transactions on the Bitcoin Lightning Network (LN) variant of their services.

According to the CoinGate blog post, traders participating in the LN sample include, among others, online stores with cryptographic goods, servers and hosting services, and entertainment sites for adults. In the announcement, he notes that payments in the Lightning Network will be available from July 1.

Lightning Network is a solution to the second layer of scalability problems for the Bitcoin network (BTC) that works by keeping most transactions out of the chain.

Rytis Bieliauskas, CoinGate technical director, told Cointelegraph that their pilot program allows them to be the first to test the Lightning network in real life, and thus have practical knowledge and valuable experience regarding the operation of this technology and the possibilities to improve it.

Referring to the Lightning Network as one of the most anticipated events for the community, Bieliauskas also noticed it, although it sees the Lightning Network technology as ultimately helping Bitcoin to become a much faster and lighter carrier of value.

LN technology is still new, «less friendly» to the casual user, so the development of consumer applications will take 1-2 years, and it is more likely that merchants will start using and promoting it more actively. Bieliauskas noted that CoinGate will also cover all costs incurred in the event of loss of funds in the LN process, as the Lightning Network technology is still at an early stage.

A study published at the end of June in which it claimed that the Lightning Network has poor credibility in effectively redirecting payments was rejected by the co-founder of Lightning Labs, as well as other experts in the field of cryptography.

Let’s now take a look at the Bitcoin technical picture at the H4 time frame. The market is getting close to the first weekly pivot support at the level of $6,064 after the overnight slump. In a case of a further slide, the next support is seen at the level of $5,900. On the other hand, the level of $6,344 will now act as a technical resistance.

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