Bitcoin payments startup Lightning Labs has raised $10 million to expand its payments network that lets companies and individuals spend bitcoin as easily as more traditional services. Building on a seed round from Square founder Jack Dorsey, Robinhood co-founder Vlad Tenev, and Litecoin creator Charlie Lee, among others, Craft Ventures led the round, with a who’s who of traditional investors participating, including Howard Morgan, former global co-head of securities at Goldman Sachs, John Pfeffer, formally of KKR, and Forbes 30 Under 30 alum Jill Carlson of Slow Ventures, and formerly a trader at Goldman Sachs.
In addition to the capital raise, Palo Alto-based Lightning Labs today launched its first financial services product, Lightning Loop, to monetize the so-called “layer-two” technology that sits on top of the bitcoin blockchain by making it easier for startups to accept the cryptocurrency. With traditional bitcoin payments firms like Bitpay and Coinbase making significant headwinds in cryptocurrency payments using more traditional technology, the one-two punch of fundraising and a product launch using the more efficient Lightning is a positive sign for the network’s adoption.
But competition is right around the corner. Last month a team of five people working at payments giant Square’s crypto offices announced it was working on its own developer kit to make it easier to build on Lightning. If this new breed of cryptocurrency products catches on it would amount to a Visa payments network, without Visa as a gate-keeper, according to Lightning Labs co-founder and CEO Elizabeth Stark. “We’re building the Visa network for bitcoin,” says Stark. “But what I think is powerful, is unlike Visa, anybody can build on top of it.”
Founded in 2016, by Stark and Forbes 30 Under 30 alum Olaoluwa Osuntokun, L...