Chapter 12. Spending, sending and Lightning

1. Why Bitcoin needed a fast lane: “the base network settles somewhere around seven transactions per second, often fewer”

   Bitcoin base-layer throughput, derived from block contents and the 10-minute target interval: in September 2026, blocks on mempool.space held roughly 2,300 to 5,000 transactions each, or about four to eight per second (mempool.space, recent blocks, retrieved September 2026); Nakamoto, “Bitcoin: A Peer-to-Peer Electronic Cash System,” 2008.

2. Why Bitcoin needed a fast lane: “handles more than 10,000 per second averaged across an ordinary day”

   Visa, “Fiscal 2025 Annual Report,” 2025 (329 billion payment and cash transactions in the fiscal year ended September 30, 2025, an average of 901 million per day, or more than 10,000 per second); Visa, “About Visa Fact Sheet,” visa.co.uk (capacity of “65,000+ transaction messages per second”), retrieved September 2026.

3. Why Bitcoin needed a fast lane: “that fee is a few cents to a couple of dollars”

   Quiet-day fees: mempool.space showed every recommended fee tier at 1 sat per vB in late September 2026, roughly a dime for a typical transaction at the May 2026 price (mempool.space, retrieved September 2026). Crowded-day example: on April 20, 2024, the day of the fourth halving, the average fee paid per transaction reached a record of about $128 (Cointelegraph, “Bitcoin fees crash after record daily average of $128 on halving day,” citing YCharts, April 2024).

4. Payments over Lightning: “Joseph Poon and Thaddeus Dryja, published the design in 2015 and finished it” · Worth repeating: “That was the whole insight of the 2016 Lightning paper”

   Poon and Dryja, “Lightning Network,” presentation to SF Bitcoin Devs, February 23, 2015, lightning.network; Poon and Dryja, “The Bitcoin Lightning Network: Scalable Off-Chain Instant Payments,” draft 0.5.9.2, January 14, 2016; Lightning Labs, “Announcing our first Lightning mainnet release, lnd 0.4-beta!,” lightning.engineering, March 15, 2018.

5. Payments over Lightning: “the publicly visible part of the network held roughly 3,750 bitcoin”

   mempool.space, Lightning explorer statistics (public channel capacity of about 3,754 bitcoin across about 32,500 channels and 16,200 nodes as of August 30, 2026), retrieved September 2026.

6. Payments over Lightning: “One research firm estimated that Lightning payments grew more than tenfold between 2021”

   River, “The Lightning Network Grew by 1,212% in 2 Years,” river.com, October 2023 (an estimated 6.6 million Lightning payments in August 2023 against 503,000 in August 2021).

7. Sats, the unit you will actually use: “card networks charge a minimum per swipe, typically 10 to 30 cents”

   Federal Reserve, Regulation II (debit interchange for covered issuers capped at 21 cents plus 0.05% of the transaction, plus a 1 cent fraud adjustment), federalreserve.gov, retrieved September 2026; Stripe, “Pricing,” stripe.com (2.9% plus 30 cents online, 2.7% plus 5 cents in person, for domestic cards), retrieved September 2026.

8. Where you can spend, tip and donate today: “As of September 2026, it listed roughly 27,000 places worldwide”

   BTC Map, “Dashboard,” btcmap.org (27,148 places listed, about 15,000 of them verified within the past year), retrieved September 2026; BTC Map, “2025 Annual Review,” blog.btcmap.org (21,823 places at the end of 2025).

9. Where you can spend, tip and donate today: “Steak ’n Shake began taking Lightning payments at every location in the United States”

   Steak ’n Shake, announcement of bitcoin acceptance, May 2025; Bitcoin Magazine, “Steak ’n Shake Now Accepting Bitcoin via Lightning Network Across U.S. Locations,” May 16, 2025.

10. Why a business would take money that moves: “Card networks charge a business between roughly 2% and 3.5% of each sale”

    Typical published card processing rates: Stripe, “Pricing,” stripe.com (2.7% plus 5 cents in person; 2.9% plus 30 cents online), retrieved September 2026; Nilson Report, “Merchant Processing Fees in the United States, 2024,” 2025 ($187.20 billion in fees on $11.903 trillion of card purchase volume, about 1.6% averaged across credit and debit).

11. Why a business would take money that moves: “that added up to about $187 billion in card processing fees in 2024”

    Nilson Report, “Merchant Processing Fees in the United States, 2024,” nilsonreport.com, 2025 (U.S. merchants paid $187.20 billion in processing fees in 2024, up 8.7% from 2023), retrieved September 2026.

12. A surfing village that changed a country: “an anonymous donor gave a community project there a sum of bitcoin”

    Linthicum, “Welcome to Bitcoin Beach: How a California surfer brought cryptocurrency to a small village in El Salvador,” Los Angeles Times, June 26, 2021 (an anonymous American donor gave “more than $100,000” in bitcoin in 2019; Peterson declined to give the exact amount); CoinDesk, “Bitcoin Beach’s Pioneering Circular Economy Is Making a Global Impact,” April 17, 2023.

13. A surfing village that changed a country: “They started paying teenagers in sats for cleaning the beach and the river”

    Bitcoin Beach, bitcoinbeach.com, retrieved September 2026; CBS News, 60 Minutes, “Bitcoin Beach: How a town in El Salvador became a testing ground for bitcoin,” April 10, 2022 (the pupusa stand run by Mama Rosa was the first business to accept bitcoin).

14. A surfing village that changed a country: “El Salvador would make bitcoin legal tender alongside the dollar”

    Bukele’s announcement by video to the Bitcoin 2021 conference in Miami, June 5, 2021 (CoinDesk, “President of El Salvador Says He’s Submitting Bill to Make Bitcoin Legal Tender,” June 5, 2021); El Salvador Legislative Assembly, Decreto Legislativo No. 57, Ley Bitcoin, dated June 8, 2021 and approved in the session of June 8 to 9, 2021, in force 90 days after publication, September 7, 2021.

15. A surfing village that changed a country: “Roughly two-thirds of Salvadoran adults had no bank account”

    World Bank, Global Findex Database 2021 (35.9% of Salvadorans age 15 and over had an account at a financial institution or mobile money provider in 2021; 43.4% in 2024), data.worldbank.org, retrieved September 2026.

16. A surfing village that changed a country: “relatives abroad made up about a quarter of the entire economy”

    World Bank, “Personal remittances, received (% of GDP), El Salvador” (26.3% in 2021; 24.3% in 2024), data.worldbank.org, retrieved September 2026.

17. A surfing village that changed a country: “about 92% of Salvadorans had not used bitcoin for a transaction that year”

    Instituto Universitario de Opinión Pública, Universidad Centroamericana José Simeón Cañas, “Encuesta de evaluación del año 2024,” Informe 177, survey of December 5 to 17, 2024, 1,266 interviews (91.8% said they had not used bitcoin in 2024), uca.edu.sv, January 2025; reported in El Diario de Hoy, “El 92% de salvadoreños no usó Bitcoin en 2024,” January 2025.

18. A surfing village that changed a country: “the country agreed to a $1.4 billion loan from the International Monetary Fund”

    International Monetary Fund, “IMF Reaches Staff-Level Agreement with El Salvador on an EFF Arrangement,” press release 24/485, December 18, 2024 (about US$1.4 billion; Executive Board approval February 26, 2025); El Salvador Legislative Assembly, reform of the Ley Bitcoin approved January 29, 2025, making acceptance voluntary (El Diario de Hoy, “Asamblea aprueba reforma a Ley Bitcoin,” January 29, 2025).

19. A surfing village that changed a country: “The government reported that it kept buying and held about 7,740 bitcoin”

    Oficina Nacional de Bitcoin, El Salvador, reserve figures published at bitcoin.gob.sv (7,740 bitcoin in the second week of August 2026), as reported by Infobae, “Reserva de Bitcoin de El Salvador sube a 7,740 monedas,” August 12, 2026; International Monetary Fund, El Salvador, Country Report No. 25/190, July 2025 (increases in the reserve “reflect the consolidation of Bitcoin across various government-owned wallets”), imf.org, retrieved October 2026.

20. Lunch is a taxable event: “virtual currency is treated as property for federal tax purposes”

    Internal Revenue Service, Notice 2014-21, 2014; IRS “Digital Assets” guidance page.

21. Lunch is a taxable event: “Sats held more than a year before selling fall under long-term capital gains rates”

    Internal Revenue Service, Topic No. 409, Capital Gains and Losses (long-term rates of 0, 15 and 20% by taxable income; net short-term gains taxed as ordinary income), irs.gov, retrieved September 2026; Publication 544. Net investment income tax: IRS, Topic No. 559, 3.8% on the lesser of net investment income or modified adjusted gross income above $200,000 (single) or $250,000 (married filing jointly), irs.gov, retrieved October 2026.

22. Lunch is a taxable event: “If the sats were a tip, they were income when received, and…”

    IRS Notice 2014-21, Q&A 3 and 8 (virtual currency received as payment is income at fair market value when received); IRS, “Frequently Asked Questions on Virtual Currency Transactions,” irs.gov, Q&A 30 to 32 (gifts take the giver’s basis, with a special rule for losses).

23. Lunch is a taxable event: “exchanges and brokers have been required to send you and the IRS a form”

    Internal Revenue Service, “Final regulations and related IRS guidance for reporting by brokers on sales and exchanges of digital assets,” T.D. 10000, June 2024 (gross proceeds reported for transactions on or after January 1, 2025; basis for certain transactions on or after January 1, 2026), irs.gov, retrieved September 2026; IRS, “Understanding your Form 1099-DA,” irs.gov, retrieved September 2026.

24. Lunch is a taxable event: “the Digital Asset Tax Certainty Act, which a House committee approved in September 2026”, “A Senate bill would exempt purchases up to $300”

    Virtual Currency Tax Fairness Act, H.R. 6582 and S. 4608 (117th Congress, 2022) and S. 4808 (118th Congress, 2024); S. 2207 (119th Congress), introduced by Sen. Lummis in June 2025 with a $300 per-transaction exclusion. None had been enacted as of August 2026: The Tax Adviser, “Tax legislation for digital assets: What’s the conversation in Congress?,” August 2026. Digital Asset Tax Certainty Act, H.R. 10357 (119th Congress), approved 38 to 5 by the House Ways and Means Committee on September 16, 2026; no gain or loss on network fees of $10 or less for taxpayers with no more than 5,000 digital asset transactions a year: EY Tax News, “Ways and Means approves digital assets tax bill,” September 2026, and Bitcoin Foundation, “Crypto Tax Bill Just Changed,” September 21, 2026 (retrieved October 2026).

25. Try it: “a working farm with a live camera on its goat herd”

    Lightning Goats, lightning-goats.com (live YouTube camera; “Send treats using the QR code in the video”), retrieved September 2026.

26. The dollar’s own layers: SWIFT and Fedwire: “a cooperative in Belgium that connects more than 11,500 financial institutions” (now on the chapter page, under More from this chapter)

    SWIFT, “Discover Swift,” swift.com (“11,500+ connected institutions” in “220+ countries and territories”), retrieved September 2026.

27. The dollar’s own layers: SWIFT and Fedwire: “It moves the dollars themselves between banks’ accounts at the Fed, instantly and finally” (now on the chapter page, under More from this chapter)

    Federal Reserve Financial Services, “Fedwire Funds Service Operating Hours,” frbservices.org (funds-transfer business day runs from 9:00 p.m. ET on the preceding calendar day to 7:00 p.m. ET; closed Saturdays, Sundays and Reserve Bank holidays), retrieved September 2026. The Federal Reserve announced in October 2025 that it will add Sundays and weekday holidays in 2028 or 2029.

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