If the new public chains Aptos, Sui and Linera are the body successors of the Meta Diem project, then Lightspark is the only soul successor of Diem.
On May 13, 2022, the newly established startup company Lightspark announced a round of financing of an undisclosed amount. The leading investors are the two top investment institutions in the blockchain industry, A16z and paradigm, which undoubtedly brought a lot of money to the project. The CEO of Lightspark is David Marcus, the co-creator of the Meta Diem project. It is worth mentioning that among the other four co-founders of Lightspark, three are also the souls of the Diem project.
For example, Christian Catalini is also one of the co-creators of the Diem project, he is also the chief economist of the Diem Association, and he is currently the co-founder and chief strategy officer of Lightspark.
Geoff Teehan was previously director of product design at Facebook, where he is currently co-founder and chief design officer at Lightspark.
James Everingham was previously VP of Engineering at Facebook Novi, where he is currently co-founder and SVP of Engineering at Lightspark.
When talking about investing in the Lightspark team, A16z partner Chris Dixon commented :
“David Marcus is a legend in the payments and crypto industry, we’ve known him for over a decade, he led PayPal, then Messenger at Facebook, and we worked closely with him during his time at Novi at Meta. When David Marcus We were very excited to talk to us about Lightspark and the early team he formed (we tried to hire a few of them!). Teams like this are rare and they have a bold vision, and we are very excited to be working with Lightspark , to achieve their ambitious goals.”
On August 25th, Lightspark’s official Twitter tweeted for the second time, welcoming Lightning Network co-author Tadge Dryja to their team, making the newly created team even more dazzling.
Diem (Libra) dream broken
In February 2019, The New York Times reported that David Marcus was the head of Facebook’s cryptocurrency project, a cryptocurrency that WhatsApp users can transfer to facilitate cross-border payments. In June 2019, Facebook officially announced the Libra project plan, and Marcus was named in charge of Calibra, a subsidiary Facebook created for the Libra project.
Criticism from politicians, regulators and financial experts came quickly, however, and Libra’s planned launch coincided with the FTC’s antitrust investigation of Facebook. In July 2019, Marcus was subpoenaed to testify about Libra before the U.S. Senate Banking Committee.
(Picture: David Marcus attends the Libra hearing)
In the face of regulatory pressure, David Marcus said helplessly:
“Facebook will not launch Libra without regulatory approval.”
In May 2020, Calibra changed its name to Novi, which is also the name of Facebook’s proposed cryptocurrency wallet. In August 2020, Marcus was appointed to head Facebook’s Finance (F2) unit, which will handle Facebook’s payments services and Whatsapp Pay operations in certain countries.
In December 2020, Libra was officially renamed Diem, and the Libra Association was renamed the Diem Association. Facebook made the series of changes to underscore the changes the stablecoin project has made following harsh criticism from regulators. And Marcus is one of the five board members of the Diem Association.
Regulators, however, did not give Diem the green light for these changes, and after nearly a year of trying and continuing to suffer, Marcus clearly realized that the Diem project, led by the Facebook (since renamed Meta) company, was not possible by any means. was released.
So in November 2021, Marcus made a very bold decision, announcing that he was leaving the company Meta.
Meta, which lost David Marcus, finally announced in January 2022 that it had disbanded the Diem project and sold the technology to a small bank called Silvergate for about $200 million.
Birth of Lightspark
After leaving Meta, David Marcus has set his sights on Bitcoin, the most secure decentralized value store and settlement network, and his new company, lightspark, will explore, build and expand Bitcoin’s functionality and utility as the first One step, they are actively forming a team to explore the Lightning Network in depth.
The addition of Lightning Network co-author Tadge Dryja to Lightspark is an important step for this entrepreneurial team.
However, information about Lightspark is still very limited at the moment, and what we can tell is that this will be a financial payment company, citing David Marcus’s mention:
“Our payments and financial systems need to change”.
With the core team of the original Diem (Libra), we can make some speculations. For example, Lightspark is likely to issue stable coins on the Lightning Network and promote cryptocurrency payment services. ( Note: the following contents are all speculation )
In this regard, we can refer to Taro , a multi-asset protocol developed by Lightning Network developer Lightning Labs . In concept, Taro is somewhat similar to early colored coins, except that Taro relies on Bitcoin’s latest Upgrade Taproot to build a new tree structure that allows developers to embed arbitrary asset metadata in existing output outputs.
To put it simply, the project party can issue assets such as stablecoins through the Taro protocol, which can either move on the Bitcoin main chain or transfer money through the Lightning Network.
With this new deal, Lightning Labs raised $70 million in Series B funding in April.
The inspiration for the creation of Lightspark may come from the Taro protocol.
Stablecoin Regulatory Issues
Having solved the technical issues, the biggest challenge for Lightspark will remain the regulatory issue, which is the direct cause of the death of the Libra (Diem) project. How does David Marcus solve the regulatory problem when it is replaced by the less influential startup Lightspark?
In this regard, we first need to look at the Stablecoin TRUST Act, a stablecoin regulation bill introduced by U.S. Senator Patrick Toomey that enforces certain rules for stablecoin issuers and clarifies Since payment stablecoins are not securities, they can be directly exchanged for fiat currency by the issuer, who needs to be licensed by the regulator.
It is reported that stablecoin issuers operating in the United States will be subject to a disclosure mechanism that will require them to conduct regular audits, detail a clear redemption policy, and specify what the stablecoins they issue are actually backed.
Assuming Lightspark were to issue compliant fiat-custodial stablecoins, they would need to obtain a license issued by the regulator and be directly regulated by the regulator. In this regard, the Lightspark team, separated from Meta’s (Facebook) influence, already has some advantages.
Stablecoins issued in this centralized way will inevitably face censorship issues. For asset holders, this does not seem to be much different from stablecoins such as USDC. The final competition is the business of the stablecoin team. Expand capacity.
Another way is to use synthetic assets to issue stablecoins. In this way, the stablecoin issuer will no longer be Lightspark itself, but users of the protocol, which may help Lightspark bypass Regulatory issues. However, the way of using synthetic assets means that the protocol introduces more complexity (see Synthetix on Ethereum ), and a startup called Galoy Inc is currently trying to issue coins on the Bitcoin Lightning Network with USD Pegged synthetic dollar.
Compared with centralized fiat-custodial stablecoins, synthetic asset-based stablecoins may introduce more attack vectors, but the latter will obviously have some advantages in terms of censorship resistance.
From a rational point of view, it is more likely that Lightspark will use a centralized custody method to issue stablecoins, because this will help David Marcus’s Crypto payment dream to advance.
What do you think?
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/an-article-on-lightspark-diems-soul-successor/
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