A former academic, Elizabeth Stark likes to play devil’s advocate. Take, for instance, her appearance at the Crypto Springs conference in October 2018.
It’s a sunny morning in Palm Springs, California, and a handful of attendees are lounging by the pool; onstage, however, Stark is busy describing some of the darker potential scenarios for the cryptocurrency industry, ones in which it could fall short of its potential.
But if the words of warning aren’t drawing a response, it’s perhaps because the price of Bitcoin is still north of $6,000, and some are optimistic that the so-called “crypto winter” will soon be over, evaporated by an end-of-year upswell in institutional money entering the industry.
It’s not a sentiment shared by Stark, though, who warns attendees that legacy financial players could take stronger measures to impede the sector’s growth. “When you change how money is created and valued, there is going to be major pushback,” Stark says.
Later, Stark draws applause when she castigates the previous year’s explosion of initial coin offerings (ICOs), and the sometimes shady startups that used them as a means of securing fundraising from a market that was suddenly full of unsophisticated buyers.
“I’m all for experimentation, but I’m not for experimentation if it means that retail investors are going to get sluiced,” she says. “Ninety-five percent of the coins that we have right now will probably fail.”
The stance has come to dominate more and more of Stark’s talks of late, that innovation can and must be balanced with steps that avoid consumer harm, and it’s one that’s taking on increasing relevance as the crypto market cools and the industry attempts to take stock of why billions in consumer money came in 2017, only to quickly retreat.
“If you really believe in decentralization then why are you creating all these centralized services?” she continues.
Referring to the way crypto exchanges and certain wallet providers control the private keys to their customers’ wallets, thus undermining the value proposition of personal financial sovereignty, she adds: “We need to get to a world where people can hold their own keys…have this autonomy.”
Yet, as frank and sobering as her talk might have been, Stark has the clout to not only call for change in the industry, but deliver it. After years of quiet building at her startup, Lightning Labs, 2018 has been a breakout year for both Stark and her company.
In fact, Stark’s accomplishments this past year dwarfed those of most other entrepreneurs, as her decision to roll up her sleeves in 2015 and take the helm of an open-source project many saw as the best chance to massively scale Bitcoin (but that perhaps had little business value) began to bear serious fruit.
Rallying the troops
If it weren’t for Elizabeth Stark, Bitcoin’s lightning network might still be just an idea.
Instead, it’s become a functioning, if niche, payments system; a hotbed of software development; and a beacon of hope for those who believe in Bitcoin’s potential as an everyday currency. All in the space of a year.
A law school graduate, Stark doesn’t code much. But there are many who credit the Lighting Labs CEO for much of the remarkable progress lightning has made.
“She helped get everyone to actually make stuff,” said Tadge Dryja, who co-wrote the 2016 lightning white paper with Joseph Poon. “Her thing is not only identifying a super-cool project, but then saying, ‘We should actually build this.’”
As such, Stark is often described as a kind of warrior queen, who now commands an army of elite developers.
“Her general conviction and ability to organize and arm the troops and to aim the cannon, then allow these really talented people to shoot, is really rare in this space,” said Jack Mallers, who developed the Zap Bitcoin wallet using the lightning network’s open-source code.
It was Stark, after all, who recruited Olaoluwa Osuntokun, a Nigerian-American prodigy, to work full-time in the cryptocurrency industry. The former Google engineering intern known as “Lalou,” now Lightning Labs’ CTO and co-founder, has become one of Bitcoin’s most prolific developers, taking over the work Dryja and Poon started on the layered scaling solution. (Both have since departed, citing differences with Stark).
More broadly, Stark is also widely credited for turning her friend Jack Dorsey, the CEO of Twitter and co-founder of Square, into a Bitcoin believer. Since Dorsey fell into Stark’s orbit, the Square payments app has become one of the most popular ways for U.S. retail investors to acquire Bitcoin. He also invested personally in Lightning Labs, the company Stark co-founded that develops the open-source Lightning Network Daemon (LND) protocol.
But perhaps the…