Blockstream is a Bitcoin development company that has positioned themselves among the leaders of innovation in the broader industry. Founded by a team of notable cryptographers and Bitcoin developers, Blockstream offers a suite of open-source technology and projects designed to push the edges of a novel industry.
Founded in 2014, Blockstream has raised $90 million from investors such as Blockchain Capital, Reid Hoffman, and Khosla Ventures.
Evaluating Blockstream’s technologies and products is important because of the prominent role that they play in the Bitcoin ecosystem. Adam Back, one of the founders and current CEO, created Hashcash — which Satoshi based his PoW consensus design on –, and another co-founder, Gregory Maxwell, is one of the leading contributors to Bitcoin’s protocol having proposed innovative solutions such as Graftroot and Taproot.
Besides the ensemble of prominent members, if you’re a developer, Blockstream offers some of the most extensive and useful resources in the broader cryptocurrency ecosystem. From their Lightning Network implementation (c-Lightning) to its Liquid sidechain project, resources are abundant.
“An Elements based blockchain can operate as either a standalone Blockchain or be pegged to another and run as a Sidechain. Running Elements as a Sidechain enables assets to be verifiably transferred between different blockchains.”
Elements is built on the Bitcoin codebase and can effectively function as a testbed for Bitcoin’s protocol while also easily producing and managing blockchains with a suite of resources at the command of developers — such as the Elements Code Tutorial. Blockstream’s Liquid is a production-grade sidechain implementation of Elements.
The general purpose of Elements is to allow businesses, developers, and other crypto firms to explore and research new applications within a resource-rich environment that has an intriguing feature set. For example, Elements is built on Bitcoin’s codebase, so it is compatible with Bitcoin’s API, and even extends the functionality of sidechains and blockchains with confidential transactions (CTs), additional opcodes, issued assets, a federated two-way peg, and signed blocks to reduce settlement times.
Elements incorporates SegWit and time-locked transactions into the technology. Blockstream is also helping to lead research on Schnorr Signatures — particularly with their proposed MuSig multi-signature standard for Schnorr.
Liquid is one of Blockstream’s flagship products that is an inter-exchange settlement network that exists as a Bitcoin sidechain. It connects numerous exchanges to provide better liquidity through faster Bitcoin transactions, and users can even issue their own assets. It has a native asset, L-BTC, which is pegged to Bitcoin via the sidechain.
Sidechains are blockchains, and Liquid leverages Blockstream’s open-source Elements Project to build a sidechain network for exchanges, market makers, and brokers for fast and private Bitcoin transactions with other users of the network.
Liquid has a suite of features including its Liquid Issued Assets technology, which enables users to tokenize traditional assets like fiat currencies, securities, and even other cryptocurrencies. Other features of Liquid include confidential transactions (CTs), an innovative method for masking transaction details originally proposed by Gregory Maxwell.
Liquid also enables a more standardized environment for interacting with pegged and tokenized assets that rely on Bitcoin’s codebase. Atomic swaps can be executed between participants in the network, further increasing security and privacy — particularly for OTC trades.
Liquid works through a 1:1 peg between BTC and its sidechain asset, L-BTC. BTC is locked on the Bitcoin blockchain, unlocking L-BTC on Liquid that can be redeemed for BTC at any point. Liquid is currently operated by a federation of exchanges and financial institutions running distinct hardware. Individuals traders can access Liquid through its wallet.
Blockstream Lightning is the company’s other major technology, consisting of its c-Lightning implementation — one of the most popular full Bitcoin Lightning Network (LN) implementations. The project is also open-source and falls under the Elements Project GitHub, where numerous repositories from Lightning Charge to FileBazaar are available.
Significant work has been performed with Blockstream’s c-Lightning implementation, including various lightning applications (lapps) that cover web games to e-commerce plugins.
Blockstream’s c-Lightning is their version of the LN, similar to Lightning Labs’ lnd implementation. Some of the notable applications so far of c-Lightning include Lightning Charge and FileBazaar.
Expect Blockstream’s c-Lightning implementation to become more widespread among enterprises and developers as further adoption continues for Bitcoin’s layer two scaling mesh network.
The Cryptocurrency Data Feed
The Cryptocurrency Data Feed (CDF) from Blockstream is a product formed in conjunction with the Intercontinental Exchange (ICE), which is the company behind the New York Stock Exchange. The product targets financial firms and institutions with historical and real-time trade data from multiple primary cryptocurrency trading venues.
Access is not open to everyone, and you need to contact the Blockstream team to gain access to the CDF.
According to Blockstream, the CDF enables true price discovery via more than 200 million trade requests per day across more than 400 crypto and fiat pairs. The product also includes market depth tools (i.e., level 2 order book), daily metric summaries, and is supplemented by ICE’s SFTI network for provisioning redundancies.
Blockstream Green is Blockstream’s official Bitcoin wallet. Designed with security and user-friendliness as the foremost considerations, Green Wallet is available for both iOS and Android. The wallet is entirely open-source.
Although Green Wallet does have some advanced security and privacy, such as dual private keys, timelock smart contracts, and no KYC processes; it does not explicitly offer features like Chaumian CoinJoins or Stonewall — available in Wasabi Wallet and Samourai Wallet, respectively.
That being said, Green Wallet is compatible with hardware wallets — Trezor and Ledger — and offers fee control along with full API support. The app is highly customizable and is a refreshing compromise on user-friendliness and security in a wallet market saturated with options.
One of the most compelling products offered by Blockstream, Blockstream Satellite is an integrated satellite network that continuously broadcasts the Bitcoin blockchain around the world.
The network works by Blockstream’s on-ground ‘teleports,’ which are full Bitcoin nodes that transmit blocks to their series of geosynchronous satellites. Each satellite — there are 5 — receive the data from the teleports and subsequently broadcast them to vast areas of the earth.
Users with a satellite antenna and USB receiver can receive the broadcasted blocks, which are broadcast 24/7, and can continuously stay in sync with the Bitcoin network. Blockstream also takes steps to ensure global redundancy and no partitioning of the teleport blockchain data.
The advantages of Blockstream Satellite are that users can plug into Bitcoin’s blockchain without an Internet connection — assuring both a more robust multi-homing network and granting broader access to the legacy cryptocurrency. Cost barriers for accessing the network are also reduced, and network stability is increased by diminishing Bitcoin’s reliance on the Internet.
Some intriguing developments regarding Blockstream Satellite have made headlines recently. Notably, Blockstream Satellite is integrated with their c-Lightning implementation and users can even pay to broadcast global messages with LN invoices using Spacebit.Live which leverages Blockstream’s satellite API.
Sidenote — Blockstream also has a useful Block Explorer that includes the Bitcoin blockchain, testnet, and their Liquid sidechain.
Blockstream is poised to continue its trajectory as one of the leading development firms in the Bitcoin ecosystem. Led by a talented team who have built some fascinating open-source projects, companies like Blockstream are drivers of innovation in the sector. Other companies like Lightning Labs and Bitfury also are pushing innovation in Bitcoin and have their own LN implementation as well.
For developers, if you’re interested in working on Bitcoin’s LN, Blockstream’s open-source Github repos are a great place to start.