Rainbow provides an ultra-fast and memory-efficient solution to clustering and assembling short genetic sequence reads produced by Restriction site Associated DNA Sequencing (RAD-seq). It does this by, first, clustering reads using a spaced seed method, then it divides potential groups into haplotypes in a top-down manner. Next, along a guide tree, it iteratively merges sibling leaves in a bottom-up manner if they are similar enough. Finally, Rainbow uses a greedy algorithm to locally assemble merged reads into contigs. Both optimal and suboptimal assembly results are output.