#10 - September 8th, 2020

⚡Funding, Lightning summer highlights, reading, and much more!

Welcome to the 10th issue of this newsletter which covers market trends, Lightning Network developments and updates about LN Markets.

If you enjoy this content, feel free to spread the word!

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🍶 Funding

As some of you may know, LN Markets enables traders to instantly stream their funds and execute trades directly from or to their digital wallets.

With no constraint of slow and complex fund transfers, a new generation of financial products becomes possible. 

In order to drive the project forward, we are quite pleased to share that we have raised a pre-seed round with some of the strongest Lightning Network advocates in the crypto space:

• Bitfinex, the earliest major exchange to offer margin trading and the first to have implemented Lightning Network deposit and withdrawals in November 2019

  Paolo Ardoino @paoloardoino

  ⚡️⚡️⚡️⚡️ @bitfinex and co. investing in the right projects to support #LightningNetwork ⚡️ expansion! #Bitcoin Layer 2 is the way

  

  BTC Times @btc

  #LightningNetwork derivatives trading platform @LNMarkets announced it has closed a pre-seed funding round, raising an undisclosed amount from investors such as Bitfinex and Arcane Crypto. @ecurrencyhodler reports https://t.co/bD2K8Szcks

• Fulgur Ventures, a Lightning fund committed to the growth of the ecosystem through funding, grants, sponsorship, and research (here on a topic that we particularly like)

  fulgur.ventures @FulgurVentures

  COVID slowdown is an opportunity to dive deeper into understanding of bitcoin. We published a write up on bitcoin as collateral - a collaboration with @MLescrauwaet with inputs from @hasufl. Feedback is much appreciated.

  

  medium.comBitcoin’s killer app is its use as collateralPart 1: a comparison between real assets

• Arcane Crypto, which develops and invests in Bitcoin projects with the aim to strengthen the European Lightning ecosystem, and is about to get listed on Nasdaq First North in Stockholm

  Torbjørn @TorbjrnBullJens

  .@LNMarkets is an extremely interesting project with a great potential. Super happy to be one of the backers together with two great partners in @bitfinex and @FulgurVentures

  

  Arcane Crypto @Arcane_Crypto

  Arcane Crypto AS has invested in @LNMarkets, together with @bitfinex and @FulgurVentures. https://t.co/fZJQY0UTEj

We are very happy with this group of investors as they have a deep understanding of the space and can add massive value to our company. With their investment and backing we will be able to accelerate our development and offer new trading experiences to our users.

Bitcoin is both a financial asset and a very powerful financial infrastructure and we intend to develop both aspects of it!

Now back to building, and more details on that very soon!

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🤓 Lightning summer highlights

ACINQ released a new version of their top-notch Lightning wallet Phoenix with support for LNURL-auth. And we had the nice surprise to find out that the team did a video demo of decentralized authentication on LN Markets ⚡

Phoenix Wallet @PhoenixWallet

Phoenix 1.3.2 is out! This version adds support for 🔐LNURL-auth, allowing secure password-less login to compatible websites. Here is a demo with @LNMarkets

After Eclair and c-lightning earlier in 2020, the latest LND release has lifted channel limits! Due to the alpha nature of the Lightning Network, the amount of BTC that we could hold in a channel was initially limited to 0.16 BTC. Now, most Lightning users can now send larger bitcoin amounts (through “Wumbo channels”), which we see as a very positive signal for the whole ecosystem.

For those still wondering about the origins of the term “Wumbo”, Lightning developer ZmnSCPxj explained it in 2018, in the Lightning Dev mailing list:

For a comprehensive audio recap on the state of the Lightning Network, we suggest Stephan Livera’s podcast with Olaoluwa Osuntokun, Lightning Labs CTO. Though we had heard that Olaoluwa spoke really fast, we didn’t expect him to speak THAT fast: feel free to listen at 0.5X speed like we did 😎

Stephan Livera @stephanlivera

SLP207 @roasbeef CTO @lightning - Lightning Labs lnd goes Wumbo! - What's the latest with Lightning Network? - Large channels - Loop - Lightning Terminal - Protocol upgrades Subscribe and share! stephanlivera.com/episode/207/

Finally, true DeFi may be on its way, and it’s built on Bitcoin! More info on DLCs here.

Marty Bent @MartyBent

People are absolutely SLEEPING on Discrete Log Contracts and how much utility they'll bring to Bitcoin. Scalable and private smart contracts with minimal onchain footprints. They are going to be MASSIVE and they'll be here sooner than most think.

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🔮 Reading: margin trading in CeFi & DeFi

Margin trading is what we offer on LN Markets. So when Su Zhu shares his views on margin trading for both centralized and decentralized exchanges, we read the man!

‘If the trend of users migrating to DeFi continues, it is possible to imagine that soon DeFi spot markets are on par with or more liquid than CeFi ones. Then margin traders may see DeFi margin trading as an increasingly viable alternative to CeFi–which in turn may compel CeFi exchanges to add DeFi liquidity into their own financial markets. Under this world, disparate CeFi markets become spokes to connect to DeFi underlying markets and users can decide which level they ultimately prefer for interacting with liquidity.’

Su Zhu @zhusu

An article for @DeribitInsights wherein I dissect margin trading in CeFi & DeFi. I note how market participants have generally utilized margin trading in each, their comparative advantages and limitations, and how they are likely to evolve in the future.

insights.deribit.comMargin Trading: CeFi v DeFi - Deribit InsightsToday I dissect margin trading in both centralized and decentralized finance. I note how market participants have sought to use such offerings in the past and present, their comparative advantages and limitations, and how they are likely to evolve in the future.

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✉️ The Lightning Lab

A newsletter which recommends another newsletter. This is not the plot of the next Nolan movie. Lightning Labs has launched a newsletter which covers their latest features and the whole ecosystem, definitely our pick for high quality Lightning content! Subscribe here:

Lightning Labs⚡️ @lightning

Today we’re launching our newsletter: The Lightning Lab🧪 In this inaugural issue we cover the Lightning Terminal release, a look at liquidity management, community news and updates, metrics, memes, and more! Read the full newsletter and subscribe here: lightninglabs.substack.com/p/its-lit-intr…

lightninglabs.substack.comIt’s LiT! Introducing the Lightning Lab, Terminal Release, and Thoughts on LiquidityAt Lightning Labs, our goal is to make sending and receiving bitcoin as seamless as sending and receiving photos (and memes!). We build the infrastructure that application developers rely on to delight their users with brand new experiences. As you’ll see, there’s an ever increasing number of projec…

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⚡ Bonus

⚠️ the following tweet may backfire:

Anthony Sassano | sassal.eth 👨‍🌾 🏴 @sassal0x

Anyone remember the Lightning Network?

DeFi bros may trash talk the Lightning Network, but we are happy to stay humble and watch the steady growth of the network. New record for Total Value Locked in the network!

CoinDesk @CoinDesk

Total value held on @Bitcoin's Lightning Network channels reached a record high of $12.4 million as August added the largest-ever number of new listening nodes. Report by @zackvoell

trib.alTotal Value on Bitcoin’s Lightning Network Sets Another Record High Amid Market Rally - CoinDeskThe Layer 2 protocol holds $12.4 million worth of bitcoins.

And finally, remember that feeling when you opened your first iPod? The River Financial onboarding package looks just as cool.. So fresh to receive an authentic ten billion Zimbabwean dollar note!

Hodl Onward 🔑 @HODLingOnward

Received this today from @RiverFinancial! A hand written note is a nice touch. I joined up after hearing one of @Leishman's interviews - I appreciate doing business with companies whose values align with mine. Looking forward to seeing what tools you develop for us going forward.

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Please feel free to reach out to us on Twitter and Telegram.

Thank you all for the support and let’s keep building a BILLION sats company together!