Introduction to the New Bitcoin Ecosystem Protocol Spark and its LRC20 Token Ecosystem

In the Bitcoin ecosystem, there are many new protocols emerging, but few can sustain long-term development. Recently, a new Bitcoin L2 solution called Spark has attracted market attention. On May 20, a well-known trading platform announced its integration with Spark and will jointly hold an event on May 26. This may indicate that the on-chain trading market for LRC20 is about to launch.

Spark officially launched its mainnet test version on April 29, and the first LRC20 Token FSPK was born on May 8. Although the minting experience was not ideal, it still sparked heated discussions in the community, with FSPK's current off-exchange transaction price having risen at least 6 times compared to its cost. In addition to collaborating with trading platforms, Spark has also partnered with multiple projects, and the ecological prototype has begun to take shape.

Spark: A Bitcoin native L2 designed for payment and settlement

Spark is an off-chain scaling solution that does not support smart contracts or virtual machines. It allows users to conduct instant, low-cost transactions of Bitcoin and other tokens off-chain, while having native interoperability with the Lightning Network.

The Spark network is currently operated by two operators, namely the parent company Lightspark and Flashnet. Although it is an off-chain solution, Spark still possesses the characteristics of being non-custodial and Bitcoin-native. It uses a Bitcoin-based shared signing protocol and operates in the form of a distributed ledger without the need for an additional consensus mechanism. Users' Bitcoin deposits are directly mapped to Spark without the need for bridging or wrapping. Even if the operators encounter issues, users can still unilaterally withdraw to the Bitcoin mainnet, ensuring the safety of their funds.

The parent company of Spark, Lightspark, was founded by a former president of a certain payment giant and completed over $170 million in Series A financing in May 2022, with a luxurious lineup of investors. Currently, the test version of the Spark mainnet has been launched, and core functions are operational, allowing developers to use the SDK to build applications.

In terms of network fees, transactions within the Spark network are temporarily free. Depositing and withdrawing Bitcoin requires paying on-chain fees, while depositing into the Lightning Network incurs a 0.25% fee and routing fees.

Spark Native Token Protocol LRC20

LRC20 is the native token protocol launched by Spark in the summer of 2024, compatible with the Bitcoin mainnet and Lightning Network, but currently only supports operation on the Spark network. LRC20 uses Bitcoin as the settlement layer and Spark as the execution layer.

To issue LRC20 Token, you must first broadcast the transaction on the mainnet and embed the token information in the OP_RETURN output. LRC20 does not support fair issuance; only the original issuance wallet can mint. It supports freeze and destroy operations, and the original issuance wallet has significant power.

Currently, several consensus-driven LRC20 Tokens have emerged in the market:

1. FSPK (ending with 8b93): The first LRC20 Token, with a total of 21 pieces, off-market price $12-20 each.

2. FSPKS: Correcting the total supply issue of the first FSPK, with a total supply of 21 million coins, airdropped to FSPK holders at a ratio of 1:1000.

3. FSPK (ending in 6c82): Total supply of 21 million coins, airdropped to the first batch of FSPK minters, off-market price 4-10 USD per piece.

4. SAT: Total supply of 210 trillion coins, airdropped to FSPK minters.

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

Early Ecological Projects and Tools

There are already some steadfast builders in the Spark ecosystem who have established collaborations with stablecoin issuance protocols and Web3 infrastructure. Early projects and tools include:

1. sparkscan: Spark network browser, which can view address balances, transaction records, and other information.

2. SparkSat: The first fully functional web wallet tool on the Spark protocol, which allows for asset management, trading, and token issuance.

3. Flashnet: One of the operators of the Spark protocol, is building a non-custodial DEX and has partnered with a stablecoin protocol to launch the Bitcoin stablecoin USDB.

With the continuous development of the ecosystem, Spark is expected to become one of the important expansion solutions in the Bitcoin ecosystem.