Strike: Using the Lightning Network to Bring Bitcoin and Fintech Into One App
Strike is a Bitcoin and fintech app that lets you buy, sell, send and receive bitcoin and USD.
How to use Strike and why could it be useful?
Strike was founded by Jack Mallers to connect fiat banking rails with the Bitcoin Lightning Network for e.g. to make cheap remittance payments.
Strike can also be used as a broker to buy and sell bitcoin.
Pay Lightning Invoices From a US Dollar Balance
Strike users don't have to own BTC the asset to send and receive money on Strike.
A user can have a dollar balance, and send a Lightning invoice from that balance.
To receive, you can specify whether you want to receive BTC or fiat as default.
Receive Fiat Using the Lightning Network
The recipient can also receive fiat, either on Strike (connected to the user's bank account), or to a mobile money account (also often connected to a bank account) in supported countries.
Strike uses the Bitcoin Lightning Network to settle between various fiat currencies.
You can e.g. send US dollars (or BTC) from the United States to Mexico, and the recipient can choose to receive Mexican pesos on her mobile money account (or USDT) if she doesn't want to receive bitcoin.
On its backend, Strike will first convert the USD to BTC on the Lightning Network, then buys back Mexican pesos with that BTC, and delivers them to the recipient's account via its partnerships with mobile money providers ("Send Globally" feature, countries listed below).
This can be a much more cost-efficient way for sending remittance payments between countries because the Lightning Network has such low fees.
If you send to another Strike account, there are no fees.
Sending BTC to BTC on Lightning often only incurs few cents in routing fees.
No More Walled Gardens
A good thing about using the Lightning Network is that it allows more interoperability.
The recipient doesn't need to have the Strike app.
She can use any app that can create Lightning invoices or she can receive fiat via Strike's partnerships.
No more walled gardens!
Strike has also added USDT for countries where "Send Globally" is not yet available (most importantly at least Europe).
Licensed and Regulated, KYC Required
Strike was initially available only in the United States, but has since launched also in e.g. Europe.
You can use Strike on mobile or desktop.
At least in the United States, Strike uses Plaid, a financial data company, to connect customers' bank accounts.
Tip Page for Donations
You can create a "tip page" on Strike, e.g. strike.me/satoshi
If people want to send you money, they can either scan the QR code and send BTC on Lightning, or you can use the tip address as a Lightning address.
The tip page could be useful for e.g. charities receiving donations, market vendors or street musicians.
Bitcoin donations can also be automatically converted to fiat to the user's account (in the United States and in "Send Globally" countries).
No Fees for Recurring Purchases
For buying bitcoin, Strike offers a "no fee DCA".
You can set up a recurring purchase order where you only pay the initial fee.
Maybe weekly set-up is the best?
Could it look too sketchy to your bank if you were paying to Strike every hour?
Watch Out for the Spread!
Fees are tiered to different levels based on the monthly trading volume, starting from 1.29%, and the more you trade, the less you pay in fees.
It's been reported that Strike also applies a spread (0.5%-1%), which is not always very transparent.
When it comes to fees and spreads, Strike is definitely not the cheapest place around to buy bitcoin.
But users seem to pay for the convenience of having a Bitcoin and Lightning Network enabled fintech remittance wallet in their pockets.
Avoid Withdrawal Fees by Choosing "Flexible"
Strike claims its bitcoin is backed 1:1, and it doesn't lend out customers' BTC.
But remember: not your keys, not your coins!
Strike naturally also offers an on-chain wallet, so you can withdraw the bitcoin you buy to your self-custodial wallet.
If you don't mind waiting for around 12 hours for your withdrawal, Strike will front the on-chain fee costs for you ("Flexible" option below):
This feature could be useful in high on-chain fee scenarios.
Buy Goods and Services with BTC or USD for Satsback!
If you want to buy goods and services from your BTC or USD balance, you can shop e.g. on Bitrefill @bitrefill, and get satsback for purchases.
You can even buy gift cards on Bitrefill using your debit card (Strike handling the BTC conversion on the backend).
You can learn more about Bitrefill in this previous Twitter thread I wrote a while back.
Unfortunately selling or spending bitcoin is still a capital gains event in most jurisdictions (even for small amounts.. such nonsense!)
Strike can be useful for the Gresham's law breed of Bitcoiners who only hodl and don't want to concern themselves with tax reporting while still staying compliant.
You can send Lightning payments from your dollar balance!
No cap gains reporting!
Strike API for Other Platforms
With the Strike API, other platforms can use Strike's functionalities in their own apps.
One example is a Nostr client Primal that uses the Strike API for its integrated Bitcoin Lightning wallet.
You can learn more about Primal in this previous post I made: #668536
Other Features
✅ Direct deposit (automatically convert you paycheck (or part of it) to BTC)
✅ Target orders (aka limit orders)
Would be quite cool if Strike was able to combine target orders with the recurring buy feature.. and put that in the Strike API!
Strike also has Strike Private service to onboard institutions and high-net-worth individuals.
It can also help businesses to buy bitcoin on their balance sheets with Strike Business.
Good for Dollar-Denominated Remittances
For who is Strike good for?
If you only want to send, receive and buy bitcoin, there are better options.
But if you want to use the dollar balance or the fiat functionalities together with Bitcoin, Strike might be the app for you.
If you send or receive remittances to/from the "Send Globally" countries and if the recipient wants to get fiat or USDT instead of bitcoin, then I would consider giving Strike a try.
This way the recipient can possibly avoid traveling several hours to pick up the cash while risking getting mugged.
Slow Verification and Customer Support Times
One downside of Strike that has been reported is that verifying your account and getting help from the customer support can be slow.
It would be better if customers could start instantly using the app with very small amounts while the verification is still in process.
Strike Makes the Transition from Fiat to Bitcoin Easier
Strike has shown that Bitcoin can be used both as an asset and as part of a global and regulated payments infrastructure.
It connects fiat to Bitcoin, using Bitcoin's 2nd layer, the Lightning Network.
All of a sudden, bank accounts are starting to speak Bitcoin too!
Strike can act as a trailblazer for other companies on other continents.
The more fintech companies use Lightning on the backend, the more liquidity can come to the network, which could eventually lower remittance costs even more.
This can create a positive flywheel for ascending countries once more capital will start flowing in to the countries.
Having apps like Strike can make the transition from fiat to Bitcoin easier.
Are you a Strike user?
What have you been your experiences using the app?
Additional Resources
"Strike - Send Payments To Anyone In The World For Free (Full Tutorial)", video review by BTC Sessions @BTCsessions