Coinbase Moves Closer to Bitcoin Lightning Integration with Lightspark Partnership
Coinbase, the popular cryptocurrency exchange, is taking a significant step towards integrating Bitcoin Lightning on its platform through a new partnership with Lightspark. Led by former PayPal president David Marcus, Lightspark is an enterprise-focused Lightning solution. In an April 4 announcement on the platform, Coinbase CEO Brian Armstrong stated that the integration of the Bitcoin layer-2 network will occur “soon.” This development will enable Coinbase’s 108 million users to take advantage of potentially faster and more cost-effective Bitcoin transactions.
The collaboration with Lightspark will “light up all Coinbase touchpoints with Lightning,” as explained in an April 3 post by Lightspark. By offloading more transaction activity to Bitcoin’s second layer, the partnership aims to address the recent increase in fees on Bitcoin’s base layer.
While Coinbase confirmed its intention to integrate Bitcoin Lightning last September, further details regarding the implementation process and timeline were not provided. Cointelegraph reached out to Coinbase for additional information but did not receive an immediate response.
Established in 2022, Lightspark has focused on simplifying the implementation and management of Lightning nodes for reliable transaction sending and receiving. Additionally, the company has developed Lightspark Predict, an AI-based smart engine that optimizes liquidity requirements and routing in real-time to enhance transaction success rates and finality times.
According to Bitcoin financial services firm River, the success rate of Lightning payments is approximately 99.7%. This data is based on the analysis of 308,000 Lightning transactions requested on its platform in October of last year. The primary reason for payment failures is the inability to find a payment route with sufficient liquidity to facilitate the transfer. River found that the average Lightning transaction size was around 44,700 satoshis or $11.84. The firm estimated that between 279,000 and 1.1 million Lightning users were active in September.
Coinbase’s main competitor, Binance, integrated Bitcoin Lightning in July of last year. Lightning has gained popularity as a payment method in Lugano, Switzerland, El Zonte in El Salvador (known as “Bitcoin Beach”), and Utiva in Costa Rica (known as “Bitcoin Jungle”).
However, some industry experts, including Bitcoin advocate Michael Saylor, believe that Bitcoin is better suited as a store of value technology rather than a medium of exchange.
In conclusion, Coinbase’s partnership with Lightspark brings the integration of Bitcoin Lightning on its platform one step closer. This move has the potential to revolutionize Bitcoin transactions, making them faster and more affordable for Coinbase’s extensive user base.