Bitcoin Layer 2 Ark Protocol’s Team Forms New Firm as Lightning Network Competitor

As a researcher with experience in the blockchain industry, I’m excited about the latest development in the world of Bitcoin payments. Ark Labs, a new company formed around the open-source Ark Protocol, aims to provide faster and cheaper payments on the Bitcoin network by building upon and enhancing the work done by the Lightning Network.

A group of individuals responsible for the development of Bitcoin‘s layer-2 protocol Ark have established a new business entity. Their objective is to construct a more expeditious and economical payment solution on the globe’s leading blockchain, with the ambition of surpassing the capabilities of the Lightning Network.

As aanalyst, I’d rephrase that into: According to an email announcement received on Tuesday, Ark Labs was founded with the mission to address the demand for cost-effective and scalable Bitcoin payment solutions.

The main goals for the newly established company are: 1) creating an open-source version of the Ark Protocol, and 2) establishing user-focused services, with the former anticipated to be completed by the end of this year.

As a crypto investor, I’d explain it this way: Ark, a Layer-2 protocol, enables me to make off-the-chain transactions without encountering the “inbound liquidity” issue that Burak Kocli identified with Lightning. In simpler terms, Ark lets me send payments quickly and efficiently without relying on the availability of liquid funds from the recipient’s end.

As a crypto investor, I’ve come to recognize that Lightning, despite its numerous advantages, comes with its own set of challenges. Among these challenges, the issue of inbound liquidity stands out to me as particularly problematic. Picture this: a payment system where you need funds to receive funds. Such a concept seems illogical and counterintuitive.

After leaving the project, Keceli focused on other endeavors. However, the protocol and the emerging Ark Labs remained dedicated to expanding upon and improving Lightning’s impact on Bitcoin.

Ark allows users to avoid pre-committing funds for liquidity by utilizing service providers that offer around-the-clock liquidity at a given fee.

Ark’s off-chain transactions employ a model based on unspent transaction outputs (UTXOs), where virtual UTXOs are utilized for processing unidirectional, one-time payments.