Lightning Network Payment System SparkSwap Makes Its Official Debut
A brand new method to exchange bitcoin and electronic currencies is currently in the publications. SparkSwap is your initial crypto exchange to be constructed on the Lightning Network.
In a blog post, SparkSwap creator Trey Griffith stated,”You are able to exchange between distinct blockchains (now Bitcoin and Litecoin, along with others coming shortly ), together with transactions settling about another — a trade time like a number of the top centralized cryptocurrency exchanges.
“In a market which, occasionally, appears to appreciate poetry and white newspapers over delivered, operating applications, we have chosen for the latter.
SparkSwap is composed of two key elements. It interprets user activities and transforms them into network activities. Additionally, it implements payment station system swaps and oversees user wallets and private keys.
The next element is referred to as the Relayer, which can be applications run by team members. It joins brokers who would like to execute financial swaps; provides orderbook upgrades; and mitigates fraud and market manipulation. The Relayer also helps users with consenting on exchange prices and implements transactions over payment station networks such as the Lightning Network, which eliminates the requirement for third parties.
Griffith explains,”With SparkSwap, you do not have to choose between rapid payoff, liquid trading monies, and keeping control of your resources. Your assets are no more vulnerable to loss or theft from exchanges, either from poor actors or local authorities.”
Crypto fans once thought the Lightning Network was restricted strictly to bitcoin, although this is not necessarily the situation. For the longest time, bitcoin and altcoin exchanges happened through processes called nuclear swaps where, if a single person wanted to exchange altcoins to get bitcoin while the other sought to exchange bitcoin to get altcoins, they might exchange by submitting two transactions: one to the bitcoin blockchain and another to the various altcoin blockchain.
The bitcoin in the next person is delivered to the first, that will then assert it, given he shows a secret amount as part of their on-chain claim-transaction. This secret amount, then, allows the 2nd person assert the altcoin on its various blockchain.
Though the process functioned, it was also a nuisance. The Lightning Network improves on nuclear swaps by linking two blockchains but 2 charge stations, which may allow a number of parties to exchange back and forth without expecting one another.
The Lightning Network may also be used to send transactions across various blockchain platforms, thus allowing monies to alter owners off-chain. The outcome is a trustless surroundings where monies can move around without documenting the trades on particular blockchains.
Discussing with BMI this past year, Litecoin founder Charlie Lee said,”Previous atomic swaps I have achieved were on-chain and had the on-chain limits of slow [trades ] and higher transaction fees. Off-chain nuclear swaps are better.
Griffith asserts that SparkSwap operates by using the exact same trustless processes over the Lightning Network. In addition, he states that while there’s more work to be performed, the machine is prepared for public use, as staff members are willing to see the community’s response and improve upon the technology from that point.
“We would love to be useful if we could,” he says.