As an Indian Bitcoiner back home recently, I found myself using UPI digital payments over and over again for everyday spending.
UPI (Unified Payments Interface) is India’s real-time bank-to-bank payment system that has become ubiquitous for making payments by scanning QR codes or using phone numbers. It has enabled even street vendors and small shops to accept payments online.
Given the difficulty of obtaining currency exchange and merchants needing to maintain card machines, UPI is often the only payment method.
And I have to agree; it’s incredibly fast, cheap, and easy to pay merchants with UPI apps compared to fumbling with Bitcoin Lightning wallets, escrow or non-escrow. Money flows quickly for free, and the process is normal for all parties involved.
While I’m big on censorship-resistant, private, and foreign currencies, the convenience of Bitcoin and UPI is hard to ignore. UPI processes over 14 billion monthly transactions at over 450 banks with no fees.
In comparison, Lightning suffers from low liquidity, channel-leveling head lists, and a clumsy user experience (which continues to improve with wallets that end up with some exchanges).
Indeed, the privacy implications of a digital system that is almost entirely controlled by centralized third parties make me cringe and sound dystopian. But many Indians happily give up privacy for convenience more often than not.
So, even as a Bitcoiner, I don’t see most Indians abandoning UPI to start using Bitcoin lightning for mass daily payments anytime soon, without the circular economy of Bitcoin. The incentive must be there. And let’s be honest – lightning still confuses Bitcoiners, leave me alone!
Perhaps down the road, privacy concerns or devaluation of the currency may push Indians towards Bitcoin payments. But for now, UPI has a lot of momentum and network impact.