Breez, a Lightning network client, has launched FiatLink, an open API standard for integrating fiat on/off ramps solely within Lightning wallets and apps. FiatLink aims to solve the issues of lack of Lightning support and proprietary APIs by brokerage services and foster an interoperable ecosystem of multiple brokers and applications.
FiatLink is an open interface standard that allows any brokerage service that supports it to be integrated into any Lightning wallet or app with no extra development overhead. This means that users can easily switch between different brokers and find the best price and service for their fiat-to-Bitcoin transfers and vice versa.
Currently, there are many challenges with the seamless integration of Bitcoin to fiat exchanges inside of applications, mainly due to the need for Lightning support by many brokerages. Moreover, each brokerage service in the market builds proprietary APIs for integration with their services, increasing the overhead of integrating multiple options by application and wallet developers.
Breez SDK, which provides tools and libraries for building Lightning applications, supports the FiatLink API and can facilitate a single solution to both problems. Breez SDK also enables developers to leverage the features and benefits of the Lightning network, such as fast, cheap, and scalable transactions, without having to deal with the technical complexities.
How FiatLink Fosters an Interoperable Ecosystem of Brokers and Apps
FiatLink, as an open interface standard, would also allow seamless integration of multiple brokerage options inside a Lightning application or wallet. Rather than independently integrating each option’s API, any brokerage service that has integrated FiatLink would be usable within an application with no extra development overhead.
This can help foster an interoperable ecosystem of multiple brokers and applications, all seeking the optimal price point in order to match between users needing to acquire fiat or Bitcoin.
Swiss Bitcoin operations, such as Relai and Pocket Bitcoin, were consulted in tailoring the API design to meet the needs of existing brokerage services.
FiatLink supports multiple payment options, such as SEPA, credit cards, and bank transfers. API providers allow users to request price and cost estimates, final quotes, and then finally confirm a specific order quote and finalize it by inputting their payment information.
In Switzerland, users are able to make transactions up to 1000 CHF (Swiss Francs) in value per transaction between Swiss brokerages and regulated non-Swiss banks without requiring additional KYC beyond the payment method.
FiatLink: A Streamlined Solution for Fiat On/Off Ramps
Withdrawals from a brokerage service to the user’s wallet are processed through LNURL-Withdraw. This function in the LNURL protocol allows a static QR code to be saved and scanned by the user at their leisure, negotiating in the background over HTTP, providing an actual Lighting invoice to receive their Bitcoin.
It allows an optional on-chain address to be included to facilitate withdrawal on-chain if it fails to process over Lightning for any reason.
The API also supports Address Ownership Proof Protocol (AOPP), which some jurisdictions require under the Travel Rule. However, in the case of Lightning wallet and applications, it can generate a random Lightning node pubkey to use for a single withdrawal.
The widespread adoption of FiatLink could provide wallet and application developers with a streamlined and competitive solution for integrating fiat to Bitcoin transfers.
