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Storj and Counterparty partner to add support for payment channels
Counterparty, a platform for free and open financial tools on the Bitcoin network, has teamed up with Storj, a decentralized cloud storage platform, to successfully develop payment channel technology for use on the Counterparty network.
By allowing exchange of commitments outside of the bitcoin blockchain, payment channels allow two users of Bitcoin to transact with each other much faster and more fluidly than Bitcoin’s 10 minute block times would normally allow. Once the users are done, they can close the payment channel by committing the last commitment to the blockchain, which will finalize the amount actually transacted. Payment channel technology powers the upcoming Lightning Network and enables low-cost, almost instantaneous Bitcoin micropayments.
“Payment channels allow for instant, ‘streaming’ payments of SJCX, which is a Counterparty token, in exchange for storage space on our network”, Shawn Wilkinson, CEO of Storj, said.
Storj developed the initial proof of concept to utilize such technology with Counterparty tokens. Codenamed ‘picopayments’, the project development was led by Storj developer Fabian Barkhau.
In its current state, the technology will facilitate unidirectional payment channels, where Storj and other Counterparty users can stream payments in SJCX or other assets to users. This development is the crucial first step in Counterparty’s long-time stated goal of enabling bidirectional micropayments for Counterparty assets in return for Bitcoin or other Counterparty assets.
“We’re excited about this development,” Counterparty lead developer Ruben de Vries said, “and appreciate the initiative Storj took here. This is a huge step forward that will truly allow for rapid, almost frictionless Counterparty token payments, as well as eventual use of Counterparty tokens on the Lightning Network.”
Barkhau and De Vries began collaboration roughly one month ago to make the code ready for addition to counterparty-lib, the Counterparty reference client. The project implements unidirectional (one way) payment channels and is nearing completion, only requiring further testing and a final review.
The code will be merged within the next month for the purpose of extensive testing on Bitcoin testnet before being enabled on Bitcoin mainnet.
Storj plans to beta test this technology during the third quarter of this year, according to Shawn Wilkinson, CEO of Storj. Other interested beta testers include Spells of Genesis.
“Micropayments technology can be a huge benefit to us, allowing us to create new features not possible before,” said Shaban Shaame, CEO of Everdreamsoft, makers of the popular Spells of Genesis game.
The next step in payment channel development will be protocol updates to enable the use of bidirectional payment channels, allowing two parties to swap one asset for another in this context. These improvements will lay the groundwork for the upcoming Lightning Network.