Lightspark Open Sources Email-Like Protocol UMA; Raises Debate on Compliance

Lightspark, a Lightning Network (LN) fiscal services company, has announced it has open-sourced Universal Money Address (UMA), a protocol akin to email, but for money. The protocol volition beryllium interoperable, allowing platforms to workout owed compliance connected the transactions facilitated, an inclusion criticized by the Bitcoin assemblage connected societal media.

Lightspark Opens UMA Protocol

Lightspark, a Lightning Network (LN) work supplier focused connected institutions, has announced it is open-sourcing codification of Universal Money Address (UMA), a protocol that resembles email but for money. According to Lightspark, UMA allows each idiosyncratic of a wallet, exchange, oregon slope to person a unique, human-readable code to person and nonstop wealth successful the signifier of the currency of their choice.

Lightspark states UMA presents respective benefits compared to different money-transmitting protocols: it is disposable 24/7, with interoperable addresses, and offers debased fees for currency conversion and transactions owed to its usage of LN successful the background. Also, it’s open-source and tin beryllium implemented by antithetic companies and wallet providers freely.

UMA allows institutions to workout owed compliance, with its authoritative leafage advertising that it “enables companies to supply global, fast, and compliant transactions portion leveraging existing infrastructure.”

The Compliance Issue

The notation of the “compliant transactions” contented gave root to a statement successful the community, with galore criticizing the thought of introducing compliance astatine a protocol level. David Marcus, co-founder and CEO of Lightspark, stressed the necessity of compliance for the maturation of LN.

Marcus, who has profiled LN arsenic a planetary payments web before, railed against this faction that believes thing that includes the connection compliance is “blasphemy.” He stated:

If we genuinely privation Bitcoin and Lightning to go the winning planetary colony web for worth connected the internet, it indispensable alteration regulated entities to enactment with the web and conscionable their compliance obligations.

Many disagreed with Marcus’ vision, stressing that compliance was not compatible with the Bitcoin ethos of freedom. Matt Ahlborg, a marketplace probe advisor astatine Bitrefill, declared:

Compliance often means racism erstwhile you are required to artifact hundreds of millions of radical based of the state they were calved in. KYC/AML [Know Your Customer/Anti-Money Laundering] arsenic it presently exists is un-american blameworthy until proven guiltless system.

Marcus clarified that UMA was backward compatible with LN-URL and that immoderate wallet implementing the protocol, adjacent without complying with KYC/AML measures, could leverage UMA to marque and person transactions.

What bash you deliberation astir UMA and its expected benefits? Tell america successful the comments conception below.