Spark: A New DeFi Star for On-Chain Liquidity? Three-Minute Guide to the Newly Launched Spark
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Spark: A New DeFi Star for On-Chain Liquidity? Three-Minute Guide to the Newly Launched Spark
Ignition airdrop Phase 1 tokens are now claimable, with the deadline at 22:00 Beijing time on July 22.
Navigating Web3 tides with focused insightsAuthor: 1912212.eth, Foresight News
On June 17, exchanges including Binance, OKX, Bybit, Bitget, and Bithumb announced the listing of Spark (SPK) spot trading. At a time when market liquidity is increasingly tight, it's rare for a project to quickly launch on major exchanges. So what exactly is the much-discussed Spark project?
On-chain Liquidity Protocol
Spark is the liquidity and yield infrastructure layer for on-chain finance. Since the birth of DeFi, the crypto market has faced persistent structural issues: highly fragmented liquidity and unstable yields. Despite years of DeFi development, these problems remain unresolved. Spark acts as an on-chain asset allocator, borrowing from Sky’s stablecoin reserves worth over $6.5 billion and deploying capital into DeFi, CeFi, and RWA. Spark provides stable liquidity to the market while achieving large-scale risk-adjusted returns.
The core of Spark is its Liquidity Layer (Spark Liquidity Layer, or SLL), which automates the provision of USDS, sUSDS, and USDC liquidity across various blockchain networks and DeFi protocols directly from Sky. This allows users to easily earn Sky savings rates in their preferred network using sUSDS. Additionally, it enables Spark to automatically supply liquidity to DeFi markets to optimize yields.
The SLL utilizes the Sky Allocation System to provide USDS, sUSDS, and USDC liquidity across different networks and DeFi markets. It mints USDS and sUSDS through Sky Allocator Vaults and bridges them to other networks via SkyLink. The minted USDS can also be converted into USDC through the Sky Peg Stability Module (Sky PSM), then bridged to other networks using Circle’s Cross-Chain Transfer Protocol. Once bridged, USDS, sUSDS, and USDC can be deposited into liquidity pools, DeFi protocols, lending markets, or other yield strategies on the target chains.
Sky aims to maintain 25% of its USDS reserves in cash, primarily USDC, to ensure the liquidity and stability of USDS. The SLL extends this liquidity from Ethereum Mainnet to supported networks. As a result, users can easily access ample liquidity, enabling seamless conversion between USDC and sUSDS. This brings the stability of USDS, the yield of sUSDS, and the liquidity of the Sky Peg Stability Module (Sky PSM) to the entire DeFi ecosystem across all supported networks.
Currently, protocols supported by SLL include SparkLend, Aave, Morpho, and Curve. Supported chains are Ethereum Mainnet, Base, Arbitrum, Optimism, and Unichain.
Spark Protocol’s core team has deep roots in the crypto space. The key member is Lucas Manuel, co-founder of Phoenix Labs—a research and development firm specializing in DeFi protocol smart contract development. Prior to that, he served as SC Tech Lead at Maple Finance. Another core contributor is Nadia, also a co-founder of Phoenix Labs, who previously led growth initiatives within the Sky ecosystem.
The final key member is Kris Kaczor, co-founder of data website l2beat.com and also an engineer at Phoenix Labs. On his Twitter bio, he describes himself as fluent in JavaScript and Klingon—one of the fictional alien languages from the sci-fi series *Star Trek*.
Tokenomics
SPK is Spark’s native token, with a total supply of 10 billion tokens, all to be distributed within the first 10 years.
The SPK supply distribution is as follows:
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65% allocated to Sky — for SPK mining over 10 years (user-facing);
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23% allocated to the ecosystem;
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12% allocated to contributors;
Sky Mining (65%) – The 6.5 billion SPK tokens allocated to Sky will be distributed to users via genesis mining, with distribution rates gradually decreasing over time.
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Year 1–2: 1.625 billion per year;
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Year 3–4: 812.5 million per year;
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Year 5–6: 406.25 million per year;
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Year 7–10: 203.13 million per year;
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Currently, the Sky Mining feature is not yet live.
Ecosystem (23%) – The 2.3 billion SPK tokens allocated to the Spark ecosystem are intended to promote ecosystem growth. 17% of these tokens will be available at TGE, with the remainder unlocking after one year. Part of this 23% allocation will also be distributed through the Ignition airdrop program to the Spark community. 1.2 billion SPK tokens are allocated to Spark’s core contributors to align long-term incentives with the development and support of Spark. These tokens will unlock 25% after a 12-month lock-up period, with the remaining portion vesting over the following three years.
Officially stated, SPK holders will be able to participate in future governance of Spark and stake SPK to earn Spark Points rewards. In the future, staked SPK may also be used to secure the protocol.
Airdrop Eligibility
According to the official website, Spark has four airdrop phases: Pre-Farming, Ignition, Overdrive, and Layer3. Details of the Pre-Farm user airdrop are as follows: Season 1 ran from August 20, 2023, to May 20, 2024, distributing a total of 130,434,783 SPK. Season 2 pool (May 20, 2024 – June 16, 2025):
SparkLend: 14,478,261 SPK per month
Aave: 7,239,130 SPK per month
This airdrop belongs to the Ignition phase, totaling 300 million tokens. The first tranche of tokens is now claimable, with the deadline set for July 22 at 22:00 Beijing Time. Any unclaimed tokens at the end of the Ignition claiming period will be redistributed during the Overdrive airdrop according to Overdrive rules.
Stablecoin Holdings
Hold USDS, sUSDS, sUSDC, sDAI, or SAI
At least $1,000 in total holdings of any of the above tokens on any snapshot date
Snapshot dates: April 15, 2023; April 15, 2024; April 15, 2025 – all at 23:59:59 UTC
Eligible chains: Mainnet, Base, Arbitrum
xDAI Holdings
Hold at least 1,000 xDAI on any snapshot date
Snapshot dates: April 15, 2023; April 15, 2024; April 15, 2025 – all at 23:59:59 UTC
Eligible chain: Gnosis
DAI Holdings
Hold at least $10,000 in DAI on any snapshot date
Snapshot dates: April 15, 2023; April 15, 2024; April 15, 2025 – all at 23:59:59 UTC
Eligible chains: Mainnet, Base, Arbitrum, Optimism, Polygon
SparkLend Activities
SparkLend Deposit
Deposit more than $100 in a single transaction to SparkLend
Deadline: Before or at 23:59:59 UTC on April 15, 2025
Eligible chains: Mainnet, Gnosis
Lending Platform Activities
Aave Lending
Borrow at least $5,000 cumulatively in USDS, sUSDS, USDT, USDC, USDe, sUSDe, DAI, or sDAI
Snapshot date: 23:59:59 UTC on March 15, 2025
Eligible chains: Mainnet, Base, Arbitrum, Polygon, Optimism, Gnosis
Morpho Lending
Borrow at least $5,000 cumulatively in USDS, sUSDS, USDT, USDC, USDe, sUSDe, DAI, or sDAI
Snapshot date: 23:59:59 UTC on March 15, 2025
Eligible chains: Mainnet, Base, Polygon
Fluid Lending
Borrow at least $5,000 cumulatively in USDS, sUSDS, USDT, USDC, USDe, sUSDe, DAI, or sDAI
Snapshot date: 23:59:59 UTC on March 15, 2025
Eligible chains: Mainnet, Arbitrum, Base, Polygon
Other DeFi
Pendle PT, YT, or LP Holdings
Hold at least $5,000 cumulatively in Pendle PT, YT, or LP tokens in markets ranked among the top three by total value locked (TVL)
Snapshot date: 23:59:59 UTC on March 15, 2025
Eligible chain: Mainnet
Ethena Holdings
Hold at least $5,000 in Ethena sUSDe or USDe
Snapshot date: 23:59:59 UTC on March 15, 2025
Eligible chain: Mainnet
Curve 3pool LP
Provide at least $5,000 as a liquidity provider (LP) in Curve 3pool
Snapshot date: 23:59:59 UTC on March 15, 2025
Eligible chain: Mainnet
Pendle vePENDLE
Hold at least $5,000 in Pendle vePENDLE
Snapshot date: 23:59:59 UTC on March 15, 2025
Eligible chain: Mainnet
Backed by billions of dollars in asset reserves from the Sky (formerly MarkerDAO) ecosystem, and demonstrating strong capital efficiency and liquidity, Spark’s potential in the future is worth watching.
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