The likelihood of transforming Bitcoin (BTC) as an interplanetary currency has sparked a debate with Elon Musk at the forefront of the conversation.
The emergence of a spot Bitcoin Exchange Traded Fund (ETF) product has sparked some theses on how additional use cases could be brought into the BTC network.
The use of Bitcoin on Mars came up in a recent Spaces on X dubbed “ARK 21Shares Bitcoin ETF (ARKB) Approved” with participants ranging from Ark Invest’s CEO, Cathie Wood to Elon Musk and Bitcoin core developer Matt Corallo.
Bitcoin’s use as a payment token is currently being obscured compared to its role as either a hedge against inflation or a Treasury reserve asset as it is being used by MicroStrategy Incorporated.
However, with the plan to launch a habitable colony on Mars by 2050, the regulatory bottleneck may be non-existent and BTC may find use as a fiat currency.
Elon Musk Spots the Challenge
Known for his penchant for technological advancements, Elon Musk initially dismissed the idea of using Bitcoin for payments on the red planet. The major issue spotted by the billionaire innovator hinges on the high reconciliation time of the Bitcoin network.
As the first ever blockchain network, Bitcoin has not evolved much over the past decade and a transaction typically takes an average of 60 minutes to settle, although this can be much lower.
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The network pulls transactions into 10-minute blocks and thereafter confirms an aggregate of 6 blocks which slows down the time transactions take to settle.
This slow speed and its energy utilization made Tesla, Elon Musk’s electric vehicle manufacturer, to halt the use of Bitcoin for payments of its products after embracing the coin in 2021.
The Way Forward
While this impediment is visible, Matt Corallo pointed out that the slow transaction speed can be tackled using the Lightning Network, a layer-2 payment solution built on the Bitcoin network.
The Lightning Network has already been shaping accessibility to Bitcoin as a payment currency on a commercial scale and after the explanations presented by Matt Corallo, Elon Musk acknowledged the potential of Bitcoin to serve as a payment coin on earth with some doubts left on its suitability on Mars.
This doubt stems from the fact that Earth is eight light minutes from the sun with Mars being 12 light minutes away. This means a time span on earth may be relatively longer on Mars, casting doubts on the suitability of the premier digital currency.