A strip club in Las Vegas is taking its first step in accepting bitcoin payments over the Lightning Network in a bid to speed up payments, lower costs and provide some much-needed privacy to clients.

Crazy Horse 3, which dubs itself a “gentlemen’s club,” says it has become the first major entertainment venue in the opulent desert oasis to accept payment using Lightning.

Bitcoin payment processor and infrastructure provider OpenNode is overseeing the club’s new payment rail, which enables guests to make purchases via the club’s website.

The question, some might ask, is why?

Bitcoin’s Lightning Network is a layer-two protocol solution designed to settle transactions off-chain in a bid to cut down the time it takes to transact in the world’s oldest cryptocurrency as well as reduce the fees associated.

When Bitcoin was first unveiled to the world back in 2009, the ability to settle seven transactions per second (TPS) seemed, at the time, just fine. Now as the network and number of users have grown, so too has the demand on Bitcoin’s infrastructure.

The Lightning Network attempts to solve that demand by increasing the maximum throughput to 25 million TPS. This is an important factor for a place like Crazy Horse 3 looking to leverage bitcoin’s growing adoption as a form of payment.

Lightning also offers an extra layer of transaction privacy; for instance, its nodes utilize Tor’s anonymous communication network known as onion routing. The routing affords nodes the ability to send transactions through each other while keeping the bitcoin transacted encrypted.

 “We are embracing the opportunity to accept Bitcoin as a way to deliver convenience, first-class hospitality and an added level of anonymity for our guests,” said a representative for Crazy Horse 3 in a statement. 

Privacy in the adult entertainment business, as they say, is sacrosanct.

What’s in it for the Horse?

Located a stone’s throw away from the new Allegiant Stadium, Crazy Horse 3 is not exactly tucked away. Though, like most adult entertainment businesses, the club faces financial judgment in the form of being labeled a “high-risk” industry.

As such, fees to payment processing companies via traditional rails are higher. On the other hand, those fees charged by using bitcoin as a form of payment are significantly lower.

Bitcoin payments can be particularly beneficial to international clients flying into Las Vegas because they don’t need to use their debit/credit cards to make fast payments.

So far, the club is only accepting bitcoin payments for bottle service, but it has plans to expand transactions to include “admission, food selections, craft cocktails, retail and the club’s signature “dance dollars,” valid toward lap dances and entertainer tipping.”

Tipping is where the Lightning Network has the potential to truly make an impact. Under the conditions of privacy, lower fees, and faster payments, the ability to pay entertainers in satoshis or “sats” – fractions of a whole bitcoin – those on the receiving end can forge entirely new local economies.

Onchain bitcoin microtransactions would be prohibitively slow and expensive. But payments on Lightning are ideally made in smaller increments, just right for tips. Add in the extra level of privacy and it’s easy to see why Crazy Horse 3 is interested in expanding its Lightning Network capabilities.