Are you an LLM? Read llms.txt for a summary of the docs, or llms-full.txt for the full context.
Skip to content

Spark Liquidity Layer

The Spark Liquidity Layer (SLL) operates as a non-custodial capital allocator for Spark across DeFi/CeFi and TradFi opportunities. At its core, the SLL is designed to ensure that capital movement is constrained, predictable, and bounded under all conditions, including periods of market stress.

The key security feature of the SLL is that Spark governance must set approved venues in advance, subject to strict rate limits. The automation wallets can only move funds between these pre-approved venues at the defined rate limits.

These constraints ensure that capital cannot be rapidly drained from any single venue, and that allocation changes occur gradually rather than reflexively under stress conditions. This directly addresses a core failure mode observed in recent market events: unconstrained capital movement leading to rapid liquidity depletion and cascading stress across markets.

The threat model for the SLL is that the automation wallet can be compromised entirely without any material risk to the protocol.

Even under this assumption, capital remains restricted to predefined venues and rate limits, ensuring no single component can introduce unbounded risk to the system.

FAQ

What protocols are supported by SLL?

The following protocols are currently supported by the SLL:

  • SparkLend
  • Aave
  • Morpho
  • Curve
  • Uniswap

Additional protocols will be integrated on a continuous basis.

What networks are supported by SLL?

The following networks are currently supported by the SLL:

  • Ethereum
  • Base
  • Arbitrum
  • Optimism
  • Unichain
  • Avalanche

Additional networks will be integrated on a continuous basis.

Has the Spark Liquidity Layer been audited?

Yes, you can find the audit reports here: Spark Liquidity Layer Audit Reports

Who controls the Spark Liquidity Layer?

Sky Governance determines the use cases supported by the SLL, such as networks and protocols, as well as the accepted risk parameters for each use case, including rate limits, maximum fund amounts or maximum volumes.