Lightning Labs, which works on building infrastructure surrounding Bitcoin (CRYPTO: BTC), has raised $70 million in a Series B funding round led by investors such as Valor Equity Partners, Baillie Gifford, and Brevan Howard.
What Happened: The funding comes in the wake of Lightning Labs announcing Taro, a new protocol that aims to make the lightning layer-2 Bitcoin solution a multi-asset network.
“We’ve talked to myriad community members in emerging markets who’ve told us what a big difference stablecoins on bitcoin and Lightning would make in their economies,” said Elizabeth Stark, CEO and co-founder of Lightning Labs.
“Taro makes sending assets like these possible using the bitcoin network with the instant, high volume, low fee nature of Lightning,” said Stark in a blog post.
See Also: What is Bitcoin Taproot Upgrade?
Why It Matters: Taro was made possible after the Taproot upgrade to Bitcoin was implemented, according to Stark.
Lightning Labs business development lead Ryan Gentry explained how Taro works in a separate post. He said the structure of Taro is such that it taps into the network effects and liquidity of today’s Lightning Network to route any number of assets, thus avoiding the need to bootstrap an entirely new network for new assets.
Example of A Multi-Hop Taro Transfer — Courtesy Ryan Gentry, Lightning Labs
Stark said the utility of Taro is particularly high in a high-inflation environment where people grapple with continuous erosion of value.
“Taro uses bitcoin liquidity to route assets issued on the protocol, there will be greater demand for bitcoin on the Lightning Network,” said Stark.
“As a result, bitcoin will route dollars, fiat, and everything in between. This is how we bitcoinize the dollar.”
Price Action: At press time, Bitcoin traded 0.3% lower at $45,379.27 over 24 hours, according to data from Benzinga Pro.
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