0xPass, a promising startup incubated at the Stanford Blockchain Club, is making significant strides in enhancing the security and user-friendly aspect of crypto wallets. The company is primarily focused on streamlining the login experience, which currently demands a substantial level of technical expertise. By enabling developers to integrate multiple authentication methods into non-custodial wallets, 0xPass aims to simplify this process. This approach is reminiscent of web2 entities like Auth0 or the infrastructure that supports password managers like 1Password.
Last November, founders Krish Chelikavada and Keon Kim were presenting their project at AllianceDAO’s demo day when the news broke that FTX had collapsed. This event triggered a domino effect that ushered in the current “crypto winter,” leading to a significant drop in cryptocurrency values. However, as many crypto projects would attest, such periods are conducive for building robust systems.
Chelikavada revealed to TechCrunch that their goal was to develop an infrastructure that starkly contrasted FTX’s. They aimed to support self-custodial wallets, giving users complete control over their assets. This feature has gained increasing popularity after FTX’s implosion. With the speculative activity in crypto slowing down, there is more room for the development of blockchain infrastructure.
Today, 0xPass announces its successful pre-seed funding round, raising $1.8 million from investors across the U.S. and Asia. The investors include AllianceDAO, Soma Capital, Alchemy Ventures, Blockchain Builders Fund, Formulate Ventures, Kommune, Hashed EM, Signum Capital/UOB, Nonce Classic, and renowned angel investors Balaji Srinivasan and Cory Levy.
Despite the FTX incident causing a stir among investors and leading to a drop in crypto industry valuations, 0xPass remained relatively unscathed. The startup’s backers are confident about the future of non-custodial wallets. However, self-custody does place the onus on users to secure their keys, prompting the developer community to explore ways to offer web2 level convenience in managing passwords without relying on a centralized party.
To address this, 0xPass employs a popular cryptographic method known as multi-person computation (MPC) to split keys into multiple parts and distribute them among various parties. Unlike traditional MPC solutions, which divide the key shares between users and service providers’ back end, 0xPass permits key shares to be distributed solely across network nodes.
Chelikavada points out that the traditional MPC method limits flexibility since developers cannot customize authentication or transaction rules as they wish. 0xPass is designed for developers seeking flexibility in authentication rules, allowing them to program automated transactions.
The startup’s monetization strategy involves charging customers for access to its key management system based on usage. While the competition may not be fierce currently, the primary challenge lies in the crypto space’s nascent stage, which raises regulatory concerns. Chelikavada admits that the uncertainty surrounding how governments will perceive wallet infrastructure is their biggest unknown.
In conclusion, 0xPass is making significant strides in enhancing crypto wallet security and user experience. By offering a flexible and secure solution to manage private keys, it is contributing to the development of a robust crypto app in the USA. As crypto education platforms continue to flourish and more people learn how to make a crypto investment blockchain, the demand for secure digital wallet solutions like 0xPass will likely grow. Despite the regulatory uncertainties, the future looks promising for this Stanford-incubated startup.