This article takes a closer look at Bitcoin-only payment processor OpenNode, in particular its support for the Lightning Network, how it compares with competitor BTCPay Server, and why it rejected Roger Ver's $1.25 million offer to support Bitcoin Cash (BCH).
On Episode 50 of the Stephan Livera Podcast, which was released on Saturday (February 2nd), Livera interviewed João Almeida and Rui Gomes of OpenNode, and during the interview asked them some interesting questions. But before we look at some of the key highlights from this interview, it's worthwhile providing a brief history of OpenNode first.
OpenNode was launched on 21 May 2018. The official Medium blog post announcing the launch called OpenNode "A lightning network enabled bitcoin payment processor that requires 0 technical knowledge from businesses to integrate." Currently, its main features include
- "Lightning enabled and on-chain payment options" (for a 1% fee)
- "In-house dashboard to analyze your finances from desktop or mobile"
- "Automatically convert bitcoin to your native currency at the time of transaction, or do it manually within your dashboard at your convenience." (Supported currencies are USD, EUR, MXN, GBP, BRL, and AUD.)
- "Plugins for the most used commerce platforms like WooCommerce, Prestashop, Opencart and many more"
- "Schedule weekly on-chain bitcoin withdrawals or manually withdraw over the Lightning Network with zero fees."
- "Quickly withdraw and receive your funds via wire transfer to your bank account"
- API access to everything you can do via the OpenNode dashboard
The first major public release came on 18 December 2018, when the team also announced that it was announce that it had concluded their seed round with Seed round with Tim Draper ansd his early stage venture capital firm Draper Associates," and that with this backing, it planned "to scale the team, build our network, and ultimately, push for hyperbitcoinization." What Draper did was to invest $1.25 million into this business.
How Did the Offer From Roger Ver Arrive and Why Did OpenNode Reject It?
"It was a YouTube video about the Lightning Network... We were very surprised when we saw the offer. Basically, what Roger Ver offered was 'I will match Tim's $1.25 million in return for zero equity' just for you to add Bitcoin Cash... That shows that Roger is our biggest supporter right now... Obviously,, we didn't accept it. Why? First, we are a Lightning Network company. It didn't really make sense to add a coin to the platform that does not even support LN..."
Here is how OpenNode rejected Roger's offer via Twitter:
Thanks for the $1.25MM offer @rogerkver, but we’re going to have to turn it down. Our vision of a better, more open financial system is only possible with Bitcoin. #bitcoin4everydayhttps://t.co/4tbavwnXXb— OpenNode (@OpenNodeCo) December 30, 2018
And this was Roger's reply:
"only possible with Bitcoin."— Roger Ver (@rogerkver) December 30, 2018
That's tribalism, not thoughtfulness. https://t.co/CvLWewxEZt
Why Do You Not Support Altcoins?
"Simply because right now we don't see an altcoin providing a better value proposition for payments than the BTC Lightning Network combo. The thing is most of these altcoins' utility is to gamble and speculate. There is nothing really useful there. That's the main reason we are not adding altcoins. Also, we don't want to support them because we are trying to reduce the risk for our users."
Comparison of OpenNode With BTCPay Server
- OpenNode is (and plans to be) a Bitcoin-only company, whereas BTCPay Server currently supports eleven cryptocurrencies including Bitcoin.
- "BTCPay Server has a more complex setup and maintenance process... obviously due to the nature of it being an open source project that you have to install on your own server... So you have to first get your own server, whether that be by your own hardware, [or] rent a server from some cloud provider... You have to spin up BTCPay Server, you have to maintain your BTCPay Server installation, you have to maintain your Lightning channels, you have to fund them upfront, you have to buy incoming liquidity from a service like Bitrefill, for example, you have to balance your channels... Even after you are done with all that setup process, you then are fully responsible and reliant on your BTCPay Server installation."
- "The Tradeoff between BTCPay Server and us is you are being more self-sovereign... It is true you don't have to trust your payment processor if you are your own payment processor... What you are gaining by adopting OpenNode is that now if you use OpenNode, you can focus on your own business and you don't need to focus on running your own payment stack... If you have a team dedicated to running a payment stack, then sure BTCPay Server makes a lot of sense in that case, but if not, then I would consider OpenNode to handle your Bitcoin payments."
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