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plausibly evades the regulatory requirements
Isn't that what the e-gold people thought too, though?
If it gains traction (nowadays, assume for this to be the case when one of the state-aligned hacker collectives starts using it at scale) it will be destroyed if it can be destroyed. There are many forms that that can take: from a lawsuit to a fatal exploit of a protocol bug; there are many plausible attacks on centralized players in answer to this plausible evasion.
This will even happen on decentralized concepts such as L1 Bitcoin, or do we really think that normies will not run back to their banks the moment Patoshi coins move and the FUD campaign starts for real?
those that inevitably get left behind when that timer expires
Yes, which is why framing and preparedness are important. OP is closer to the mark than self-custodial but about as one dimensional.
Last time I checked there were still proprietary components too
There are. 50/50 They aren't robust enough to open source and not worth making robust enough without scale, or it'll be part of a moat.
evades the regulatory requirements
at scale*
... which is the real problem
The state went after Samourai and Tornado Cash, those were actually non-custodial unlike Spark. Spark lying to it's users to lie to the state by proxy can only work to the extent they don't flaunt how clever they think they are.
"Show me the man and I'll show you the crime", being a transmitter is just one of a countless potential charges.
There's zero reason to think the state will be arsed to go after Uncle Jim nodes. The scale of Spark is a much more likely target regardless of their crypto-theater. When their heads do inevitably get squeezed over something, their scale of Lightning swaps will hand the state the data it needs to deanonymize swaths of the network.
Further, if they do go down, how many things break? How many Lightning businesses see their traffic drop off precipitously because one API became unreachable?
Using Spark is not just indifference towards trusting them with diminimis amounts, but is an active attack on Lightning itself because of systemic risk it presents.
did burak Ark just never happen cuz CTV never happened?
Two companies are moving ahead with it:
Without CTV, ark users have to
- come online once every two weeks
- else it effectively becomes custodial
To be bitcoin by such a definition, you need as much control over your coins as bitcoin gives you, and, other than onchain, lightning is the only thing that gives you that.
💯! Couldn't agree more...
If most people, initially or for small amounts, are only willing to use bitcoin and lightning via these fallible trusted layers, what do you recommend we do/tell/teach them that changes their mind?
As of today, Spark is the most custodial-like experience we have on bitcoin that plausibly evades the regulatory requirements of custodial services. It makes a bunch of tradeoffs to do that. None of us like that, including Spark I'd guess.
I don't think I'm speculating when I say that most people don't want to deal with liveness and liquidity requirements to custody their day-to-day spending money nor do they want to KYC. That's what motivates the Liquid<>Lightning swap and ecash wallets. Like Spark, they sacrifice being bitcoin to give people something closer to what they want.
They claim there is: https://docs.spark.money/learn/withdrawals#unilateral-exit
I haven't seen a wallet with it implemented yet, but I'd guess they aren't fibbing about it being theoretically possible.
It could be practically infeasible though.
Bitcoin on an exchange, in a custodial wallet, in Liquid, in an ecash mint is also not bitcoin. To be bitcoin by such a definition, you need as much control over your coins as bitcoin gives you, and, other than onchain, lightning is the only thing that gives you that.