It doesn’t. Because on-chain transactions are (or will be) too expensive and slow for most people, creating a big business opportunity for middlemen.

>creating a big business opportunity for middlemen

...or decentralized settlement networks like LN.

Not really decentralized when people have to rely on third party apps like Strike to open channels for them, or they have to open the channels themselves while both users are online. It’s a mess from a usability standpoint.

Decentralized =/= middlemen. Relying on a third party isn’t centralization.

...which again provides an opportunity for middlemen.

> ...or decentralized settlement networks like LN.

Not very, though. Lightning recentralizes the Bitcoin blockchain to improve efficiency.

"10 percent of [Lightning] nodes control 80 percent of funds on the network." — Bitcoin’s Lightning Network Is Growing 'Increasingly Centralized,' Researchers Find[1]

[1] https://www.coindesk.com/bitcoins-lightning-network-is-growi...

Speculating here, but my observations of Dorsey/Square is that they see more long term value in being an exchange for fiat to cryptocurrency rather than (only) being a settlement house for payments. I see them acting as both exchange and clearing house (and debit and credit provider, and payroll service, and...), which, sure, Visa could too, but Square has/is building the infrastructure for those mutual use cases, and Visa is mostly playing catch-up.

Of course, it's the loudest voices that always get heard and are oft repeated, but I'd say most of us in the industry realize that cryptocurrency will never be a 1:1 replacement of traditional fiat currency--barring some significant breakdown of society and government. It's more of a complementary thing. Something more like internet and radio (i.e. both are still used today, one did not completely replace the other). Not the best example but you get the picture. And then there is 3rd and 2nd world countries where crypto can be used as a sort of stop gap solution until a viable form of government and banking can be situated.

Square is in the payment business. Credit cards are just one method. E.g., Square supports Interact in Canada for a flat fee of $0.10.

Bitcoin is unrelated to this news.

Bitcoin = Father of all coins.

They make money when you buy/sell Bitcoin through their app. (Cash app)

They are leveraging their massive reach to increase the value of private crypto holdings. This isn’t allowed for regular stocks and shares so crypto is an opportunity.