About the Author: I'm Tim Dierckxsens, CEO of Venly, a blockchain technology provider. Before founding Venly, I spent years as a business consultant, helping executives innovate with digital solutions in industries like music, postal services, supply chain, and banking.

------

Redefining Wallets: More Than Just a Place to Store Your Crypto

A wallet isn't just a secure space to store your digital assets—it's also how you communicate with the blockchain network. In essence, a wallet is your digital identity on the blockchain. It allows you to interact with decentralized applications (dApps), sign transactions, and access various services across the blockchain.

‍

By viewing wallets as accounts or identities, we open up a broader understanding of their capabilities. This perspective highlights the importance of user-friendly and secure wallet solutions that not only safeguard assets but also facilitate seamless interaction with the blockchain.

Why Does This Matter for You?

Integrating blockchain into your business is already challenging enough. With wallets being the primary gateway to and from a blockchain network, we need to pay attention to how they're secured and integrated. Ideally, we shouldn't have to be blockchain experts to create and manage these wallets, and we certainly shouldn't limit ourselves to a single blockchain network.

Understanding Wallet Security

Since wallets are the primary gateway to interact with blockchain, it's crucial to delve into their security. The great thing is that blockchain wallets are secured with cryptographic protocols—one of the fundamental advantages that blockchain brings to your application. There are different methods on how accounts can be secured, and I'd like to cover the three main ones: Shamir Secret Sharing (SSS), Multiparty Computation (MPC), and Account Abstraction (AA).

‍

To simplify how they differ, imagine the classic tale of "Ali Baba and the Forty Thieves," where the cave opens with the phrase "Open Sesame." How we access that key phrase differs for the three protocols.

Shamir Secret Sharing (SSS)

In SSS, the secret phrase is divided into parts. Imagine Bob and Kate each holding a piece of the key phrase. Bob knows "Open," and Kate knows "Sesame." They need to come together at the same time to combine their parts and open the cave. Neither can open it alone.

Multiparty Computation (MPC)

With MPC, Bob and Kate still have parts of the key phrase, but they don't need to reveal their parts to each other. They use a secure computation method where they input their shares, and a system verifies the correctness without exposing the secrets. It's like both entering codes into a secure machine that confirms if they match, without either seeing the other's code.

Account Abstraction (AA)

In AA, Bob and Kate don't need to worry about the key phrase details anymore. Instead, they use smart wallets programmed with rules that handle the process automatically. The wallets know how to open the cave without Bob and Kate manually entering their parts or even being aware of the exact process.

Choosing Between the Security Methods

Account abstraction is a promising innovation that simplifies blockchain integration by removing some complexities when interacting with the blockchain network. It goes beyond cryptographic protocols to secure wallets, embedding smart contract logic directly into the wallet to transform it into a programmable contract.

‍

While I see a lot of potential in account abstraction, I feel it's a bit early to push it for most use cases. Instead of diving deeper into programmable wallets, I'd like to highlight the problems account abstraction aims to solve: simplifying user experience and enhancing flexibility.

‍

By embedding smart contract logic directly into the wallet, users can interact with blockchain without dealing with transaction details like gas fees or validation rules. While this can be beneficial, I wonder if it's the right place to address these challenges or if it's taking things a step too far.

‍

In my opinion, wallets and smart contracts should remain separate. A wallet should be simple - holding keys, signing transactions, and interacting with smart contracts when needed. This keeps their role minimal and secure. Smart contracts manage logic and allow applications to function. Entangling them can create new points of failure and attack vectors, straying away from the core benefits of blockchain.

What About SSS and MPC?

Both encryption protocols are tried and tested and serve their purpose. Some may argue that MPC is slightly more secure, and I agree, though it comes with additional cost and complexity.

‍

My main argument is that for 99% of use cases out there, SSS will serve your needs when it comes to cryptographic security for your wallets. It’s important to emphasize that security itself is a layered approach.

Imagine Your House Is a Wallet

Think of your house as a wallet. The front door is like a high-security, bomb-proof, fire-proof door that requires a tamper-proof key to open. This door represents the strong cryptographic protections provided by protocols like SSS or MPC.

‍

But here's the catch: if you leave a spare key under the flower pot or the back door wide open, then no matter how secure your front door is, your house (or wallet) is still vulnerable.

Even the most robust cryptographic protocols can't fully protect you if other parts of the system aren't equally secure. That's where our SaaS platform comes in.

Introducing Venly's Wallet as a Service (WaaS)

Our Wallet as a Service (WaaS) is designed with this expanded role in mind. We provide wallets that function as comprehensive blockchain accounts, enabling users to fully engage with the ecosystem. To ensure that developers and end-users alike can leverage the real potential of blockchain technology without getting bogged down by complexity, we've developed a dual approach offering different integration methods.

Choosing Between Venly's Wallet Widget and Wallet API

Understanding the difference between the widget and the API can be quite simple—think about integrating technology in the front end or back end of an application.

Venly's Wallet Widget

The Wallet Widget is a front-end integration. We onboard users through our identity and access management platform. We'll provide a user interface to help them sign up, create a blockchain wallet, and manage their wallet and transactions within your application. Implementing the widget is the quickest way to launch your app with blockchain capabilities. While there will be a pop-up or redirect within your application, we also offer the Wallet API as an alternative solution to provide a more seamless experience.

Venly's Wallet API

The Wallet API, on the other hand, is a back-end integration. If you already have an identity and access management system and want to maintain seamless interactions within your application, the API-based solution is ideal. You'll create blockchain wallets in the back end, map them to your own identity management system, and develop interfaces that are natively built within your application.

‍In my opinion, this is the most sustainable way forward, following best practices of modern applications and eliminating unnecessary friction.

Real-World Success Stories

To illustrate how our WaaS can make a difference, here are some success stories:

Case 1: Mass User Onboarding

CoinStats, a leading crypto, DeFi, and NFT portfolio manager, onboarded 700,000 users over 18 months using the Venly Wallet API.

Case 2: Web3 Gaming

The Sandbox, one of the largest metaverse platforms, onboarded nearly 4 million users using Venly's Wallet Widget. They are currently valued at $1 billion after their latest $20 million Series C round.

Case 3: Real-World Assets (RWAs)

Companies like Toyow use Venly's WaaS to tokenize real-world assets like art and real estate, making them more accessible and liquid. Carré democratizes real estate investment via our Wallet API, allowing more investors to participate in the market.

Case 4: Loyalty Programs

Businesses are transforming traditional loyalty programs by integrating Web3 wallets, enabling users to own and trade loyalty points as digital assets, creating more engaging experiences.

Why Choose Venly at All?

We understand the challenges of integrating blockchain technology, and we're here to help you navigate them. With unparalleled security, we employ rigorous protocols—including multi-factor authentication (MFA) and cryptographic key management—to ensure transaction integrity and asset safety. Our segregated wallet approach provides individual control and transparency, giving you peace of mind.

‍

Venly offers multi-chain support, allowing you to build digital wallets that work across 14 blockchains like Ethereum, Polygon, and Binance Smart Chain—without worrying about the underlying complexities. Whether you prefer custodial or non-custodial wallet options, we provide flexible choices to suit your business model and user needs.

‍

Our developer-friendly tools, complete with comprehensive documentation and quick-start guides, make it easy for your team to get up and running. Our APIs and SDKs streamline the process of wallet creation and integration, so you can focus on what you do best.

‍

We're here to support you every step of the way. From initial integration to ongoing updates, our dedicated support team is committed to your success. We offer you the most robust and feature-complete SaaS platform covering the fundamentals of blockchain adoption and integration.

Let's Simplify Blockchain Together

Blockchain technology doesn't have to be complicated. With Venly's WaaS and SaaS platform, you can focus on building your product while we handle the complexities of wallet management.

I'm genuinely excited about the possibilities our WaaS opens up for businesses and developers alike. If you have any questions or want to explore how Venly can empower your project, I'd love to chat with you.

Ready to Get Started?

• Start Building Now: Visit our Developer Portal to get started right away.‍
• Talk to an Expert: Set up a meeting with one of our experts to discuss your project's specific needs.

‍

‍