Spark Protocol's Q1 2026 financial report reveals a net surplus of $3.46 million, despite a 47% sequential decline. The protocol generated a gross return of $31.5 million and a net return of $6.91 million, both reflecting a 31% and 30% decline, respectively. The protocol treasury increased by 5.7% to $46.1 million. The quarter marked a shift in revenue composition, with distribution rewards becoming the largest source of net returns at $3.31 million, surpassing the Spark Liquidity Layer (SLL) for the first time. SLL maintained an average deployed capital of $19.3 billion with a 5.8% annualized yield. SparkLend's institutional lending products deployed $150 million, with governance approving a lending ceiling increase to $1 billion. Despite challenging DeFi market conditions, Spark's distribution business and USDS savings mechanism continue to expand.