When we started working on what would become Sparkswap over two years ago, it was due to a deep belief in the importance of Bitcoin to the future of the world financial system, and the importance of self-custody to the future of Bitcoin.
We built Sparkswap to enable what we see as a core financial activity — trading — without sacrificing self-custody, which is so fundamental to the value that Bitcoin provides. By building on Lightning we were able to extend the work that has been done with atomic cross-chain swaps to build an experience that was as fast as trading on centralized exchanges.
Sparkswap Desktop, our final product, sought to bring a consumer experience to this cutting edge technology, allowing ordinary Bitcoin users to buy Bitcoin without sacrificing self-custody. The experience, as described by our users, was “magical” — instant transfers of Bitcoin to your own wallet via Lightning. We are incredibly grateful to our customers who used Sparkswap as their primary way to buy Bitcoin and spread the word about us.
Unfortunately, we weren’t able to build a large enough audience to sustain the business over the long term. Building a cryptocurrency business, especially one that interacts with the fiat banking system, is an expensive endeavor, and as it stands right now the style of self-custody we were espousing is too niche to make our business sustainable.
As a result, we’re shutting down the Sparkswap product and service. Effective today, we won’t be accepting any further user sign-ups or additional USD deposits. Existing users will have until March 24, 2020 to make any final BTC purchases before we terminate all trading activity. We plan to retire our Lightning node by the end of the March.
Even after we terminate trading, your USD funds will continue to be held in your account with our banking partner, AnchorUSD. AnchorUSD has mobile applications for iOS and Android, and offers a High Yield USD Interest account as well as mobile crypto trading. You can also redeem your USD to your bank account. All fees for bank account redemptions via AnchorUSD will be waived until the end of April.
We are still believers in the vision of the future that Bitcoin and Lightning provides and the importance of self-custody to a Bitcoin-backed financial system. Our sincere hope is that we were simply too early, and in a few years a service like Sparkswap will overtake custodial exchanges. But as Howard Marks said, “being too far ahead of your time is indistinguishable from being wrong.”
Wrong as we may have been, the beauty of Bitcoin is that it is independent of any one company or person. There continues to be a tremendous amount of exciting development in Bitcoin and Lightning bringing us closer to the financial system that we deserve. And while we won’t be able to carry the torch forward, most of the code that we’ve written to build our products has been and will remain open source, so we hope that others can learn from and build on our approach.
For now, our focus as a company will move to FinTech more broadly, but we’ll be watching Bitcoin and Lightning development closely and plan to continue to be productive members of those communities.
Thank you to our community for their enthusiasm, our customers for their trust and patience, and to our investors for their unwavering support. Feel free to email us with any questions or comments: firstname.lastname@example.org.