Lightning Network Based Derivatives Exchange, LN Markets, Gets Investment From Bitfinex

Lightning Network Based Derivatives Exchange, LN Markets, Gets Investment From Bitfinex


LN Markets, a crypto derivatives exchange based on the BTC Lightning Network, recently concluded its pre-seed round. This event attracted crypto heavyweights, including Bitfinex Exchange, Fulgur Ventures, and Arcane crypto. The firm is, however, has yet to disclose how much was raised in this funding round.

Lightning Network, which is Bitcoin’s scaling layer, came as a solution to the reducing efficiency of Bitcoin blockchain as more participants joined the network. The technology has since powered several innovations that leverage Bitcoin’s blockchain for transactions. LN Markets, which is one of the projects built on this scalable BTC layer, is among the beneficiaries of its features when it comes to efficiency in transaction speeds and costs. The firm’s launch announcement noted,

“With LN Markets, traders can instantly access Bitcoin markets, post margin, and claim P&L [profit and loss] instantly in a trust-minimized environment.”

Making a debut earlier in the year, this initiative by a Bitcoin startup dubbed ‘ITO’ allows crypto traders to exchange digital assets directly from their Lightning Network wallets. The platform’s leverage can go up to 50x, although its trade limit is still low, with each trader capped at 0.01BTC. So far, over 25,000 trades have been executed within the LN Markets ecosystem, averaging $10 million in volume since the exchange’s launch.

Other than financing, LN Markets philosophy seems to be in tune with that of its investors in the pre-seed round. Bitfinex CTO, Paolo Ardoino, commented that,

“When we look at a project such as LN Markets, we see a direct application of the technologies that we love … It is, therefore, important for us to provide funding and to participate in such an innovative venture.”

The firm is now expected to increase development within its networks as it looks to stand out given the support of BTC’s Lightning Network as its base layer. Ardoino further noted,

“This is one of our first public investments and underlines our support for the Lightning Network.”

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