French Bitcoin startup ACINQ has completed a $ 1.7 million seed financing. The funds will be used to drive the development of the Bitcoin Lightning Network, tools and services. The ultimate goal is to make the Bitcoin Lightning Network accessible for mass adaptation.
The official press release states that the financing round was led by Serena Capital. Other investors include Bertrand Diard (co-founder of Talend), Sebastian Lucas, Alistair Milne (VC investor) and Yves Weisselberger (founder of Snapcar). Including past funding, ACINQ - which started working on the Lightning Network in 2015, shortly after they first described Joseph Poon and Thaddeus Dryja in a white paper - has now raised $ 2 million in 2018. The new funds will be used to hire more software developers and develop new Lightning Network services.
ACINQ is currently well known for developing the Eclair Software Suite, which works alongside Lightning Labs' and Blockstream's implemented protocols. Eclair also launched the first mobile Lightning wallet in the Google Play Store, making it the most popular mobile LN wallet with more than 5,000 downloads.
The Lightning Network (LN) is a scaling solution for Bitcoin, so the Bitcoin network can handle more transactions. In practice, it should allow an unlimited number of immediate payments at very low cost. The LN is based on a technology called "payment channels".which serve to make the payments outside the bitcoin blockchain ("off-chain"). The big advantage of this is that the transactions are not immediately written to the blockchain (after they have been validated by the miners).
Instead, the payments are processed off-chain, which reduces the transaction volume for the Bitcoin Blockchain. Instead of writing many smaller transactions in the blockchain, two or more parties can use the payment channel to determine how long they will allow the channel to continue, and when the transactions will be included in the blockchain. If this happens, the parties of the payment channel have a private key. Only when both parties sign with their key and thus signal that the transaction is completed, the total amount or the balance is written to the blockchain and the channel is closed.
There are currently two other companies currently working with ACINQ to develop the Lightning Protoll: Lightning Labs and Blockstream. The developments are currently still in a beta test phase.