Bitcoin New Ecosystem Protocol Spark and Its Ecosystem

Recently, several new protocols have emerged in the Bitcoin ecosystem, most of which merely repackage old models using the concept of inscriptions, lacking substantial infrastructure and development. However, amidst this chaotic market, there are still teams that are doing serious work.

On May 20, a well-known Bitcoin ecological trading platform announced a partnership with the emerging Bitcoin L2 project Spark and plans to jointly hold an event on May 26. Spark, as an innovative Bitcoin scaling solution, officially launched its mainnet test version on April 29. On May 8, the first LRC20 token FSPK was born. Although the minting process was not very smooth, it still sparked great enthusiasm in the Bitcoin ecological community. Currently, the over-the-counter trading price of FSPK has reached $12-20 per token (1 token = 0.001 coins), compared to the minting cost of about $2 per token, the price has increased at least 6 times.

This cooperation may signify the imminent launch of the on-chain trading market for LRC20. In addition, Spark has established partnerships with several projects, and the ecosystem's initial form has begun to take shape. Meanwhile, the project also has the support of well-known venture capital institutions. This article will briefly introduce Spark, the currently issued LRC20 tokens, and its ecological projects.

Spark: A Bitcoin Native L2 Designed for Payments and Settlements

Spark claims to be a Bitcoin-native L2 solution designed for payments and settlements. In reality, Spark adopts an off-chain scaling solution that does not belong to EVM-like chains or Rollup types, does not support smart contracts, and has no virtual machine. Spark allows users to conduct instant, low-cost, and unrestricted self-custodial transactions with Bitcoin and other tokens (including stablecoins) off-chain, while having native interoperability with the Lightning Network, enabling the sending and receiving of tokens through the Lightning Network.

For Bitcoin scaling solutions, users are most concerned about the security of Bitcoin, specifically whether Bitcoin entering L2 can be safely and unobstructedly withdrawn. The Spark network currently has only two operators, and theoretically, for all transactions occurring on Spark, at least one operator must authorize together with the user for it to succeed. This design may pose risks, as user funds may be threatened if both operators experience failures at the same time.

Although Spark, as an off-chain scaling solution, retains the non-custodial and Bitcoin-native characteristics. The core of Spark utilizes a Bitcoin-based shared signature protocol, operating in the form of a distributed ledger without the need for additional consensus mechanisms. Users' Bitcoin deposits are directly mapped to Spark without any transfer bridges or wrapping. Even if Spark operators disappear, attempt censorship, or refuse to cooperate, users can still unilaterally force withdrawals to the Bitcoin mainnet, ensuring the safety of their funds.

Lightspark, the parent company of Spark, completed a Series A financing round of over $170 million on May 13, 2022, with a very strong lineup of investors.

On April 29, Spark launched the public test version of its mainnet, with core functions such as sending and receiving Bitcoin, creating tokens, and lightning interoperability fully operational. Developers can also use Spark's SDK to build applications.

In terms of network fees, users do not incur any fees when trading on the Spark network. Depositing or withdrawing Bitcoin to or from Spark requires a certain Bitcoin on-chain fee, while transferring Bitcoin from Spark to the Lightning Network incurs a 0.25% fee and routing fees.

Although the officials have clearly stated that Spark does not have a token and there will be no airdrops or token TGE plans, shortly after the release of the Spark mainnet test version, LRC20 was fully mined by the market.

Spark Native Token Protocol LRC20

LRC20 is the native token protocol launched by Spark in the summer of 2024, which is compatible with the Bitcoin mainnet and the Lightning Network, but is still under development and currently only supports operations on the Spark network.

LRC20 uses Bitcoin as the settlement layer, while Spark serves as the execution layer. Anyone can issue LRC20 tokens, but before issuing, users need to broadcast a transaction on the mainnet, embedding the token's identifier and metadata into the OP_RETURN output. After successful broadcasting, tokens can be minted on Spark.

LRC20 does not support a fair issuance model. After the token is issued, only the original issuance wallet can mint, and other addresses can only obtain tokens through airdrops or distributions by the developers. At the same time, LRC20 also supports freezing and destroying operations. The original issuance wallet can freeze tokens on any address, and the tokens held by the frozen address will be locked, unable to be received or sent unless the developers unfreeze them; however, the original issuance wallet can only destroy the tokens it holds, and the destruction is irreversible.

These features indicate that LRC20 is indeed designed for the issuance of stablecoins, granting the original issuance address greater power. However, for other addresses holding tokens, if they do not relinquish the freezing power, there are also hidden centralization risks. Currently, several strongly consensus LRC20 tokens have emerged in the market, but due to the need for computer terminals to mint and various operations by developers in the early stages, the situation regarding tokens is somewhat chaotic.

FSPK (ending with 8b93): the first LRC20 token

• Total supply of tokens: 21 coins
• OTC trading price: 12-20 USD/piece
• Issuance date: May 8

This is the first LRC20 coin. Due to the project team's incorrect setting of the token supply, the final total is 21 coins. Currently, one FSPK (ending in 8b93) is worth 0.001 coins, and the minting cost for a single one is about 2 dollars.

FSPKS: Correcting the first FSPK (ending with 8b93)

• Total supply of tokens: 21 million coins
• Issuance date: May 12

The project team realized that the total supply of the first FSPK, which is 21 coins, is too small. Therefore, a new token, FSPKS, is issued to replace the first FSPK. The new FSPKS tokens will be airdropped to FSPK holders at a ratio of 1000 coins for each FSPK.

FSPK (ending with 6c82)

• Total Token Supply: 21 million coins
• Over-the-counter trading price: 4-10 USD per piece (1 piece = 1000 coins)
• Issuance date: May 11

Due to the difficulties players encountered when minting the first FSPK (ending in 8b93), a certain team airdropped FSPK (ending in 6c82) to the first 21,000 users who transferred the first FSPK (ending in 8b93).

SAT

• Total supply of tokens: 210 trillion coins
• Release Date: May 11

SAT is an airdrop given by anonymous developers to all addresses that minted the first FSPK (ending with 8b93). Due to its inheritance of the huge total supply tradition of SAT and zero cost, it has also attracted community attention.

SNOW

• Total token supply: 21 million coins
• OTC trading price: 19 USD/piece
• Issuance date: May 17

SNOW is launched by the Spark ecosystem project sparksat and is the first LRC20 token endorsed by an official project party, thus gaining high recognition from the community. Currently, its over-the-counter transaction price is 19 USD/piece, with a cost of only 1 USD, and the price has risen 19 times.

Early Ecological Projects and Tools

The biggest difference between Spark and other briefly emerging new protocols is that, although it is still in the early stages, there are already some steadfast builders in its ecosystem, reminiscent of the early BRC20 ecosystem. In addition to collaborating with a well-known exchange platform, Spark has also established a partnership with the stablecoin issuance protocol brale, planning to launch a stablecoin on Bitcoin; and has partnered with the Web3 infrastructure Privy to help project teams build decentralized applications on Bitcoin.

The following is an introduction to early projects and tools in the Spark ecosystem:

sparkscan

sparkscan is the browser for the Spark network, where users can enter a Spark network address to view token balances, transaction records, etc. Users can also enter the token public key to see the number of token holders, total supply, transaction history, and more.

SparkSat

SparkSat is the first fully functional web wallet tool on the Spark protocol, and it is also the project party of the LRC20 token SNOW, not operated by Spark officially. By importing the mnemonic phrase into SparkSat, users can clearly view their asset situation and can directly deposit and withdraw Bitcoin on the mainnet and conduct transactions on the Spark network and Lightning Network through the SparkSat front end. This tool can also be used to issue LRC20 tokens directly and to view all LRC20 tokens in one place, making it the "Unisat" of the Spark protocol.

Flashnet

Flashnet is one of the two operators of the Spark protocol and the developer of the Spark browser sparkscan. On February 4, 2025, Flashnet completed a $4.5 million seed round financing.

Flashnet is committed to building a permissionless, non-custodial, Bitcoin-native decentralized exchange, and may also launch a Spark ecosystem decentralized exchange in the future. At the same time, it has partnered with the stablecoin issuance protocol brale to launch the Bitcoin stablecoin USDB.