SparkSwap Exchange Uses The Lightning Network—But Is It Ready Yet?
A new exchange, SparkSwap, has entered the crypto scene and is promising faster transactions thanks to the fact that it runs on Lightning Network. Currently, SparkSwap is in its testnet phase and supports trading Bitcoin and Litecoin.
The Lightning Network has only existed since December 2017, but its advocates have promised that it will soon solve Bitcoin and Litecoin‘s scaling problems. Lightning can increase the speed of (and decrease the cost of) transactions by carrying out those transactions off of the main blockchain.
So far, Lightning has been used on everything from Reddit clones to online games. However, SparkSwap claims to be the first exchange built on the Lightning Network. (Others, such as Vaultoro and Legolas may also claim that title, if you include exchanges that are still in development.)
But in any case, the Litecoin School of Crypto has endorsed SparkSwap on Twitter. That endorsement was in turn retweeted by Charlie Lee, the founder of Litecoin and a vocal advocate of the Lightning Network:
This project @sparkswap looks very promising. You’ll be able to trade $LTC and $BTC via atomic swaps through the Lightning Network. They don’t have a product out for main net yet but I like what I see so far! #Litecoin #Bitcoinhttps://t.co/ExRSPSRxDo
— The Litecoin School of Crypto ⚡️ [UASF] (@theliteschool) August 1, 2018
The Lightning Network is decentralized, meaning that it’s unlikely to be adopted by centralized exchanges—but it is ideal for decentralized uses. SparkSwap is one of those: a decentralized peer-to-peer exchange in the vein of Bisq. This means SparkSwap doesn’t store any funds, which prevents theft, hacks and asset freezing.
This all sounds promising; however, one of several shortcomings of the Lightning network is the fact that it will not be fully beneficial until it is widely adopted. There are not very many Lightning nodes right now. It is also complicated for developers to implement, which is slowing its adoption.
In other words, SparkSwap and its competitors may not be reaping as many benefits as they claim to at the moment. That’s not necessarily true for the future, though: Lightning may become an altcoin killer, leading exchanges like SparkSwap that primarily focus on Bitcoin to be in high demand.
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