Lightning Labs, a startup focused on developing the Lightning Network, a Layer 2 payment channel network for Bitcoin, has launched a new marketplace for liquidity on the network.
According to an announcement, the new non-custodial, peer-to-peer marketplace “transforms” Lightning liquidity into a tradable asset called Lightning Pool, allowing users to “buy or sell access to liquidity.”
Lightning Pool opens the door to new Lightning financial products, or “LiFi,” the startup said in a statement.
“Unlike other services on the market, Pool sellers can earn yield on real bitcoin without trusting a third party or losing custody of their funds,” according to the firm. “The yield is earned from buyers on the Pool willing to pay a premium for access to new capital on Lightning without counterparty risk.”
The new marketplace is meant to address a general lack of liquidity on the Lightning Network, which has been an obstacle to its adoption. “Users attempted to solve this problem in a variety of ad hoc ways, such as chat groups and OTC services,” the release states. “Pool provides a solution that enables all of them to participate.”
© 2020 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.