Will Lightning Network Solve Bitcoin’s Issues? Preliminary Evidence on the Impact of Layer2 Solutions on Cryptocurrencies’ Adoption in Micro Enterprises

Despite wider recognition of cryptocurrencies as relevant financial tools, their practical adoption as a medium of exchange has been limited due to technical hurdles like scalability and high transaction costs. Layer 2 technologies aim to solve these limitations. However, the impact of adopting Layer 2 technologies in a business setting remains relatively unexplored. This study investigates the impact of one of the most discussed Layer 2 technologies, the Lightning Network (LN), on Bitcoin adoption, specifically in the context of Italian micro enterprises. By employing the revised Unified Theory of Acceptance and Use of Technology (UTAUT2) and conducting sixteen structured interviews, we found that the Lightning Network positively influences retailers’ Performance Expectancy, Hedonic Motivation, and Price Value, while negatively affecting Effort Expectancy. These results underscore the importance of Layer 2 technologies for cryptocurrencies’ adoption and suggest several further research avenues in this nascent domain of inquiry.