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Spark (SPK) Delivers Strong Financial Results for Q3 2025 Post-SKY Independence
Decentralized Finance (DeFi) protocol Spark (SPK) has released its third-quarter financial performance report for 2025, marking a milestone as its first comprehensive Profit & Loss (P&L) statement since gaining financial independence from SKY on July 1. Spark emphasized its solid revenue generation and efficient capital allocation during Q3, reinforcing its competitive positioning within the DeFi sector.
Key Financial Performances
The Q3 2025 financial report highlights Spark's robust achievements:
- Total Revenue: Spark recorded $53.01 million (approximately KRW 76.05 billion) across all products.
- Gross Profit: Gross profit amounted to $19.2 million (approximately KRW 27.55 billion) after deducting the cost of capital.
- Net Profit: After accounting for operating expenses, Spark posted a net profit of $12.12 million (approximately KRW 17.39 billion).
- Treasury Holdings: By quarter-end, Spark reported treasury holdings of $38.8 million (approximately KRW 55.67 billion).
Following its decision to operate independently, Spark began with a seed allocation of 25 million USDS as initial capital on July 1.
Breakdown of Core Revenue Streams
Spark's financial success in Q3 was powered by five major product lines:
1. Spark Liquidity Layer (SLL)
The Spark Liquidity Layer utilizes smart contracts to optimize asset management and return generation. Profits are derived from the spread between annual percentage yields (APY) and capital costs.
This segment generated $10.21 million (approximately KRW 14.64 billion) in gross profit during Q3. A substantial portion of this was driven by the Morpho Spark USDC Vault on Coinbase's Base blockchain, which deployed Bitcoin (BTC)-collateralized lending services worth $607 million (approximately KRW 871 billion). This specific deployment generated $8.59 million (approximately KRW 12.32 billion) in revenue.
2. USDS Distribution Rewards
As the on-chain distribution agent for SKY’s native stablecoin USDS, Spark earned accessibility rewards of 0.6% annually through referral codes. Centering around sUSDC Vaults, USDS circulation surged significantly during the quarter, delivering $2.65 million (approximately KRW 3.8 billion) in revenue.
3. SparkLend
SparkLend—a native lending platform that prioritizes high-quality assets—generated profits via reserve factors applied on borrower interest.
During Q3, SparkLend's markets expanded to $800 million (approximately KRW 1.15 trillion) for Tether (USDT) and $500 million (approximately KRW 717 billion) for PayPal’s PYUSD. SparkLend’s total revenue for the quarter reached $305,500 (approximately KRW 438 million).
4. Market Curation
Spark specializes in curating vaults for assets such as USDS, DAI, and USD Coin (USDC) on Ethereum and Base blockchains. By earning interest revenue shares as fees, Spark became the leading curator on the Morpho leaderboard. This segment contributed $176,500 (approximately KRW 253 million) in Q3 revenue.
5. Treasury Management
Through treasury monetization activities, including SKY savings rates, Spark efficiently utilized its operational capital base. Treasury Management delivered a net income of $861,600 (approximately KRW 1.24 billion) in Q3.
Q3 Key Drivers and Strategic Position
Growth Highlights
Spark pointed to significant strategic milestones in Q3 2025:
- Integration of PayPal’s PYUSD, leading to $500 million (approximately KRW 717 billion) in deposits.
- Expansion of SparkLend’s USDT markets by $550 million (approximately KRW 788.5 billion).
These developments boosted Spark's revenue streams while cementing its role as a prominent DeFi protocol.
Market Volatility and Risk Mitigation
Despite strong yields during the first half of Q3, the latter half of the quarter experienced increased volatility in the digital asset market. This led to tempered profitability as market conditions softened.
To counter these challenges, Spark adhered to a strategy that emphasizes high-quality assets, particularly within SparkLend. Additionally, SLL deployments primarily targeted over-collateralized on-chain loans secured via collaborations with SparkLend and Morpho.
Advancing DeFi Excellence
Spark’s sound financial results and targeted strategic maneuvers affirm its competitive edge within the decentralized finance ecosystem. With a robust infrastructure for capital allocation and product innovation, Spark remains well-positioned for continuous growth as it navigates the evolving DeFi landscape.
