Bitcoin Ecosystem New Star Spark: An Innovative Off-Chain Scaling Solution

Recently, a batch of new asset issuance protocols has emerged in the Bitcoin ecosystem. Although most projects lack substantial infrastructure and long-term development plans, there are still some innovative attempts worth noting. Among them, Spark, as a new type of Bitcoin scaling solution, is gradually attracting market attention.

On May 20th, a well-known Bitcoin ecological trading platform announced its integration with Spark and plans to jointly hold an event on May 26th. This may indicate that the on-chain trading market for LRC20 tokens is about to launch. Spark officially released its mainnet test version on April 29th, and the first LRC20 token, FSPK, was born on May 8th. Although the initial minting experience was poor, it still sparked a lot of enthusiasm in the Bitcoin ecological community. Currently, the over-the-counter trading price of the first FSPK token has reached $12-20 per token, compared to the minting cost of about $2 per token, representing an increase of at least 6 times.

In addition to its collaboration with trading platforms, Spark has also established partnerships with multiple projects, and the prototype of its ecosystem is beginning to take shape. It is worth mentioning that Spark is backed by well-known venture capital institutions. This article will briefly introduce Spark, the currently issued LRC20 tokens, and its ecological projects.

Spark: A Bitcoin native Layer 2 designed for payments and settlements

Spark is an off-chain scaling solution designed specifically for payments and settlements. It differs from EVM-compatible chains or Rollups, as it does not support smart contracts and has no virtual machine. Spark allows users to conduct instant, low-cost, and unrestricted self-custodial transactions of Bitcoin and other tokens (, including stablecoins ), off-chain. At the same time, Spark has native interoperability with the Lightning Network, supporting the sending and receiving of tokens through the Lightning Network.

For Bitcoin scalability solutions, users are most concerned about the security of funds. The Spark network is currently managed by two operators, and in theory, all transactions require the joint authorization of at least one operator and the user to be completed. Although this design introduces certain risks, Spark still maintains the non-custodial and Bitcoin-native characteristics.

Spark adopts a Bitcoin-based shared signature protocol, operating in a distributed ledger form without the need for additional consensus mechanisms. Users' Bitcoin deposits are directly mapped to Spark without any bridging or wrapping. Even if Spark operators encounter issues, users can still unilaterally withdraw to the Bitcoin mainnet, ensuring the safety of funds.

The parent company of Spark, Lightspark, was founded by former PayPal president and Facebook messaging products vice president David Marcus. The company completed a Series A funding round of over $170 million in May 2022, with a strong lineup of investors.

Currently, the public testing version of the Spark mainnet has been launched, and core functions such as sending and receiving Bitcoin, creating tokens, and Lightning Network interoperability are fully operational. Developers can use Spark's SDK to build applications. In terms of network fees, transactions within the Spark network are temporarily free, but withdrawals and deposits of Bitcoin require a certain on-chain fee.

Spark Native Token Protocol LRC20

LRC20 is a native token protocol launched by Spark, compatible with the Bitcoin mainnet and the Lightning Network, but is still under development and currently only supports operation on the Spark network. LRC20 uses Bitcoin as the settlement layer and Spark as the execution layer.

Anyone can issue LRC20 tokens, but they need to broadcast a transaction on the mainnet first, embedding the token information in the OP_RETURN output. LRC20 does not support a fair issuance model; only the original issuance wallet can mint tokens after they are issued. At the same time, LRC20 supports freezing and burning operations, giving the original issuance address significant power.

Currently, several well-known LRC20 tokens have emerged in the market:

1. FSPK(8b93 ending ): the first LRC20 token, with a total supply of 21 coins, off-chain trading price of 12-20 dollars each.

2. FSPKS: Issued to correct the total amount issue of FSPK, with a total of 21 million coins, airdropped to FSPK holders at a ratio of 1:1000.

3. FSPK(6c82 ending ): total supply of 21 million coins, off-chain trading price of 4-10 dollars per piece.

4. SAT: A total of 210 trillion coins, inheriting the tradition of the massive total supply of SAT.

5. SNOW: Launched by the Spark ecosystem project sparksat, with a total supply of 21 million coins, the off-chain trading price is $19 per piece.

Early Ecosystem Projects and Tools

There are already some steadfast builders in the Spark ecosystem, showcasing the characteristics of the early BRC20 ecosystem. In addition to collaborating with trading platforms, Spark has also established partnerships with stablecoin issuance protocols and Web3 infrastructure providers.

The main early ecosystem projects and tools include:

1. sparkscan: A browser for the Spark network, used to view address balances, transaction records, and other information.

2. SparkSat: The first fully functional web wallet tool on the Spark protocol, hailed as the "Unisat" of the Spark protocol.

3. Flashnet: One of the operators of the Spark protocol, committed to building a permissionless, non-custodial, Bitcoin-native DEX.

These early projects laid the foundation for the development of the Spark ecosystem, which may attract more developers and users to participate in the Spark ecosystem in the future.