cryptocurrency

Crypto wallet BRD raises $15M for Asian expansion

Posted by | brd, cryptocurrency, Mobile, Startups | No Comments

Mobile cryptocurrency wallet BRD is announcing that it has raised $15 million in Series B funding.

The funding comes from SBI Crypto Investment, a subsidiary of Japanese financial services company SBI Holdings (formerly a subsidiary of SoftBank). BRD said the funding will allow it to grow its product and engineering teams, and to expand in Japan and across Asia.

“SBI Group’s investment in BRD allows us to firmly cement ourselves in the Asian market,” said BRD co-founder and CEO Adam Traidman in a statement. “It shows incredible support for the foundation that we have built in North America and reinforces our proven ability to scale the success we have achieved in the past 4 years. The new investment will ensure our long-term global growth, and we are incredibly excited about collaborating with SBI as a strategic investor and business partner to make that happen.”

It’s surprising to see a crypto startup raising money now, given the broader crypto downturn. After all, BRD bills itself as the simplest way to start buying and storing cryptocurrencies — but does that mean anything if consumers are being scared away from investing?

BRD - App - Wallet Screen

When I asked Spencer Chen, the company’s vice president of global marketing (and an occasional friend of mine), about the industry’s recent challenges, he argued, “The need for a single, global currency still exists.”

“That’s what all got lost in 2018 as the fast-money, traders, and speculators came piling into the crypto space,” Chen told me via email. “It really convoluted the core mission of a natively digital currency. Money that worked just like the open internet. As a company that’s built-to-last and committed to the core mission of crypto currency, there was nothing more frustrating than to witness the many steps backwards the industry at large took in 2018.”

In fact, BRD says it doubled its total install base in 2018, ending the year with 1.8 million users globally. It also says it’s currently being used to store the equivalent of $6 billion mostly in Bitcoin and Ethereum — with a 24 percent increase in monthly active users between November and December, after it started accepting stablecoins (which are pegged to the value of a fiat currency).

BRD has now raised a total of $55 million. It’s also announcing a partnership with Coinify, allowing users to make cryptocurrency purchases using bank accounts in the European market.

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Anchorage emerges with $17M from a16z for ‘omnimetric’ crypto security

Posted by | Anchorage, Andreessen Horowitz, Apps, blockchain, Chris Dixon, cryptocurrency, Enterprise, funding, Fundings & Exits, Mobile, Recent Funding, Security, Startups, TC, Venture Capital | No Comments

I’m not allowed to tell you exactly how Anchorage keeps rich institutions from being robbed of their cryptocurrency, but the off-the-record demo was damn impressive. Judging by the $17 million Series A this security startup raised last year led by Andreessen Horowitz and joined by Khosla Ventures, #Angels, Max Levchin, Elad Gil, Mark McCombe of Blackrock and AngelList’s Naval Ravikant, I’m not the only one who thinks so. In fact, crypto funds like Andreessen’s a16z crypto, Paradigm and Electric Capital are already using it.

They’re trusting in the guys who engineered Square’s first encrypted card reader and Docker’s security protocols. “It’s less about us choosing this space and more about this space choosing us. If you look at our backgrounds and you look at the problem, it’s like the universe handed us on a silver platter the Venn diagram of our skill set,” co-founder Diogo Monica tells me.

Today, Anchorage is coming out of stealth and launching its cryptocurrency custody service to the public. Anchorage holds and safeguards crypto assets for institutions like hedge funds and venture firms, and only allows transactions verified by an array of biometrics, behavioral analysis and human reviewers. And because it doesn’t use “buried in the backyard” cold storage, asset holders can actually earn rewards and advantages for participating in coin-holder votes without fear of getting their Bitcoin, Ethereum or other coins stolen.

The result is a crypto custody service that could finally lure big-time commercial banks, endowments, pensions, mutual funds and hedgies into the blockchain world. Whether they seek short-term gains off of crypto volatility or want to HODL long-term while participating in coin governance, Anchorage promises to protect them.

Evolving past “pirate security”

Anchorage’s story starts eight years ago when Monica and his co-founder Nathan McCauley met after joining Square the same week. Monica had been getting a PhD in distributed systems while McCauley designed anti-reverse engineering tech to keep U.S. military data from being extracted from abandoned tanks or jets. After four years of building systems that would eventually move more than $80 billion per year in credit card transactions, they packaged themselves as a “pre-product acqui-hire” Monica tells me, and they were snapped up by Docker.

As their reputation grew from work and conference keynotes, cryptocurrency funds started reaching out for help with custody of their private keys. One had lost a passphrase and the $1 million in currency it was protecting in a display of jaw-dropping ignorance. The pair realized there were no true standards in crypto custody, so they got to work on Anchorage.

“You look at the status quo and it was and still is cold storage. It’s the same technology used by pirates in the 1700s,” Monica explains. “You bury your crypto in a treasure chest and then you make a treasure map of where those gold coins are,” except with USB keys, security deposit boxes and checklists. “We started calling it Pirate Custody.” Anchorage set out to develop something better — a replacement for usernames and passwords or even phone numbers and two-factor authentication that could be misplaced or hijacked.

This led them to Andreessen Horowitz partner and a16z crypto leader Chris Dixon, who’s now on their board. “We’ve been buying crypto assets running back to Bitcoin for years now here at a16z crypto. [Once you’re holding crypto,] it’s hard to do it in a way that’s secure, regulatory compliant, and lets you access it. We felt this pain point directly.”

Andreessen Horowitz partner and Anchorage board member Chris Dixon

It’s at this point in the conversation when Monica and McCauley give me their off-the-record demo. While there are no screenshots to share, the enterprise security suite they’ve built has the polish of a consumer app like Robinhood. What I can say is that Anchorage works with clients to whitelist employees’ devices. It then uses multiple types of biometric signals and behavioral analytics about the person and device trying to log in to verify their identity.

But even once they have access, Anchorage is built around quorum-based approvals. Withdrawals, other transactions and even changing employee permissions requires approval from multiple users inside the client company. They could set up Anchorage so it requires five of seven executives’ approval to pull out assets. And finally, outlier detection algorithms and a human review the transaction to make sure it looks legit. A hacker or rogue employee can’t steal the funds even if they’re logged in because they need consensus of approval.

That kind of assurance means institutional investors can confidently start to invest in crypto assets. That swell of capital could help replace the retreating consumer investors who’ve fled the market this year, leading to massive price drops. The liquidity provided by these asset managers could keep the whole blockchain industry moving. “Institutional investing has had centuries to build up a set of market infrastructure. Custody was something that for other asset classes was solved hundreds of years ago, so it’s just now catching up [for crypto],” says McCauley. “We’re creating a bigger market in and of itself,” Monica adds.

With Anchorage steadfastly handling custody, the risk these co-founders admit worries them lies in the smart contracts that govern the cryptocurrencies themselves. “We need to be extremely wide in our level of support and extremely deep because each blockchain has details of implementation. This is inherently a very difficult problem,” McCauley explains. It doesn’t matter if the coins are safe in Anchorage’s custody if a janky smart contract can botch their transfer.

There are plenty of startups vying to offer crypto custody, ranging from Bitgo and Ledger to well-known names like Coinbase and Gemini. Yet Anchorage offers a rare combination of institutional-since-day-one security rigor with the ability to participate in votes and governance of crypto assets that’s impossible if they’re in cold storage. Down the line, Anchorage hints that it might serve clients recommendations for how to vote to maximize their yield and preserve the sanctity of their coin.

They’ll have crypto investment legend Chris Dixon on their board to guide them. “What you’ll see is in the same way that institutional investors want to buy stock in Facebook and Google and Netflix, they’ll want to buy the equivalent in the world 10 years from now and do that safely,” Dixon tells me. “Anchorage will be that layer for them.”

But why do the Anchorage founders care so much about the problem? McCauley concludes that, “When we look at what’s potentially possible with crypto, there a fundamentally more accessible economy. We view ourselves as a key component of bringing that future forward.”

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Spot is a cryptocurrency app to control all your wallets and exchange accounts

Posted by | Apps, blockchain, cryptocurrency, Edouard Steegmann, Europe, France Newsletter, Mobile, SPOT, Spot.so, Startups | No Comments

Meet Spot, a beautifully designed mobile app to control your cryptocurrencies. Spot looks like a portfolio-tracking app. But the company has built a strong foundation to add more features in the coming months. Spot wants to be your unique gateway to the world of cryptocurrencies.

“Spot’s vision isn’t to build a portfolio tracker — we went a bit overboard with this feature,” co-founder and CEO Edouard Steegmann told me. “Eventually, we want to become the app to manage all your cryptos, a sort of Revolut but with a crypto DNA.”

When you first install the app, you can connect it to your existing wallets by adding public addresses. Even if you store your tokens on a hardware wallet, Spot can read the public details of your wallet to show them in the app.

“We have our own nodes on Ethereum, Bitcoin, Litecoin, Stellar and others to recover the amount on your wallet,” Steegmann said. Data is also cross-checked with third-party services to make sure that everything is fine.

Spot also lets you connect to an exchange account using API keys. Right now, the app supports Binance, Kraken, Bitfinex and Poloniex, but the company already plans to add more exchanges.

The app then gives you a detailed overview of your holdings across all services and wallets. You can see detailed charts, and discover which token is performing better than the rest. It’s also one of the most well-designed mobile apps I’ve seen this year — the animations and interactions are gorgeous.

But Spot doesn’t rely on an API to get pricing information for each token. “We’ve rebuilt CoinMarketCap from the ground up, and we’re one of the few companies that have done it,” Steegmann said. The company stores pricing information for dozens of tokens across 150 exchanges. That’s a lot of pairings.

If you tap on the Spot logo at the top of the app, you can see the maximum value of your portfolio if you cash out on exchanges with the highest prices for your tokens. The company makes sure that there’s enough volume to show you coherent prices.

Spot thinks that controlling your own data is too important to rely on API calls. When you have your own data, you don’t have any API rate limits, you don’t have a major dependency and you can scale more calmly.

Up next, you’ll be able to trade directly in the app. The company isn’t going to build its own exchange, but you can expect to buy and sell tokens on a third-party exchange without having to visit the website.

“We think that many things will be tokenized and that there’s no user-friendly interface to transfer, receive, buy and sell,” Steegmann said.

The company raised a $1.2 million round (€1.056 million to be exact) from Kima Ventures and business angels, including Eric Larchevêque and Thomas France from Ledger, Jean-Daniel Guyot, Thibaud Elzière, Eduardo Ronzano, Nicolas Steegmann, Sébastien Lucas and Nicolas Debock.

Disclosure: I own small amounts of various cryptocurrencies.

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Meet ‘Bitski’, the single sign-on wallet crypto desperately needs

Posted by | Apps, Bitski, blockchain, crypto wallet, cryptocurrency, Developer, funding, Fundings & Exits, Mobile, OAuth, payments, Recent Funding, single sign-on, Startups, TC | No Comments

The mainstream will never adopt blockchain-powered decentralized apps (dApps) if it’s a struggle to log in. They’re either forced to manage complex security keys themselves, or rely on a clunky wallet-equipped browser like MetaMask. What users need is for signing in to blockchain apps to be as easy as Login with Facebook. So that’s what Bitski built. The startup emerges from stealth today with an exclusive on TechCrunch about the release of the developer beta of its single sign-on cryptocurrency wallet platform.

Ten projects, including 7 game developers, are lined up to pay a fee to integrate Bitski’s SDK. Then, whenever they need a user’s identity or to transact a payment, their app pops open a Bitski authorization screen, where users can grant permissions to access their ID, send money or receive items. Users sign up just once with Bitski, and then there’s no more punching in long private keys or other friction. Using blockchain apps becomes simple enough for novices. Given the recent price plunge, the mainstream has been spooked about speculating on cryptocurrencies. But Bitski could unlock the utility of dApps that blockchain developers have been promising but haven’t delivered.

“One of the great challenges for protocol teams and product companies in crypto today is the poor UX in dApps, specifically onboarding, transactions, and sign-in/password recovery,” says co-founder and CEO Donnie Dinch. “We interviewed a ton of dApp developers. The minute they used a wallet, there was a huge drop-off of folks. Bitski’s vision is to solve user onboarding and wallet usability for developers, so that they can in-turn focus on creating unique and useful dapps.”

The scrappy Bitski team raised $1.5 million in pre-seed capital from Steve Jang’s Kindred Ventures, Signia, Founders Fund, Village Global and Social Capital. They were betting on Dinch, a designer-as-CEO who’d built concert discovery app WillCall that he sold to Ticketfly, which was eventually bought by Pandora. After 18 months of rebranding Ticketfly and overhauling its consumer experience, Dinch left and eventually recruited engineer Julian Tescher to come with him to found Bitski.

Bitski co-founder and CEO Donnie Dinch

After Riff failed to hit scale, the team hung up its social ambitions in late 2017 and “started kicking around ideas for dApps. We mocked up a Venmo one, a remittance app…but found the hurdle to get someone to use one of these products is enormous,” Dinch recalls. “Onboarding was a dealbreaker for anyone building dApps. Even if we made the best crypto Venmo, to get normal people on it would be extremely difficult. It’s already hard enough to get people to install apps from the App Store.” They came up with Bitski to let any developer ski jump over that hurdle.

Looking across the crypto industry, the companies like Coinbase and Binance with their own hosted wallets that permitted smooth UX were the ones winning. Bitski would bring that same experience to any app. “Our hosted wallet SDK lets developers drop the Bitski wallet into their apps and onboard users with standards web 2.0 users have grown to know and love,” Dinch explains.

Imagine an iOS game wants to reward users with a digital sword or token. Users would have to set up a whole new wallet, struggle with their credentials or use another clumsy solution. They’d have to own Ethereum already to pay the Ethereum “gas” price to power the transaction, and the developer would have to manually approve sending the gift. With Bitski, users can approve receiving tokens from a developer from then on, and developers can pay the gas on users’ behalf while triggering transactions programmatically.

Magik is an AR content platform that’s one of Bitski’s first developers. Magik’s founders tell me, “We’re building towards reaching millions of mainstream consumers, and Bitski is the only wallet solution that understands what we need to reach users at that scale. They provide a dead-simple, secure and familiar interface that addresses every pain point along the user-onboarding journey.”

Bitski will offer a free tier, priced tiers based on transaction volume or a monthly fee and an enterprise version. In the future, the company is considering doubling-down on premium developer services to help them build more on top of the blockchain. “We will never, ever monetize user data. We’ve never had any intent at looking at it,” Dinch vows. The startup hopes developers will seize on the network effects of a cross-app wallet, as once someone sets up Bitski to use one product, all future sign-ins just require a few clicks.

In August, Coinbase acquired a startup called Distributed Systems that was building a similar crypto identity platform called the Clear Protocol. A “login with Coinbase” feature could be popular if launched, but the company’s focus is to spread a ton of blockchain projects. “If [login with Coinbase] launched tomorrow, they wouldn’t be able to support games or anything with a unique token. We’re a lockbox, they’re a bank,” Dinch claims.

The spectre of single sign-on’s biggest player, Facebook, looms, as well. In May it announced the formation of a blockchain team we suspect might be working on a crypto login platform or other ways to make the decentralized world more accessible for mom and pop. Dinch suspects that fears about how Facebook uses data would dissuade developers and users from adopting such a product. Still, Bitski’s haste in getting its developer platform into beta just a year after forming shows it’s eager to beat them to market.

Building a centralized wallet in a decentralized ecosystem comes with its own security risks. But Dinch assures me Bitski is using all its own hardware with air-gapped computers that have been stripped of their Wi-Fi cards, and it’s taking other secret precautions to prevent anyone from snatching its wallets. He believes cross-app wallets will also deliver a future where users actually own their virtual goods instead of just relying on the good will of developers not to pull them away or shut them down.” The idea of we’ve never been able to provably own unique digital assets is crazy to me,” Dinch notes. “Whether it’s a skin in Fortnite or a movie on iTunes that you purchase, you don’t have liquidity to resell those things. We think we’ll look back in 5 to 10 years and think it’s nuts that no one owned their digital items.”

While the crypto prices might be cratering and dApps like Cryptokitties have cooled off, Dinch is convinced the blockchain startups won’t fade away. “There is a thriving developer ecosystem hellbent on bringing the decentralized web to reality; regardless of token price. It’s a safe assumption that prices will dip a bit more, but will eventually rise whenever we see real use cases for a lot of these tokens. Most will die. The ones that succeed will be outcome-oriented, building useful products that people want.” Bitski’s a big step in that direction.

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Blockchain partners with Ledger for its hardware wallet

Posted by | blockchain, cryptocurrency, Distributed Ledger, Gadgets, hardware wallet, Ledger | No Comments

Blockchain startup Blockchain shared its roadmap for the coming months. The company is launching a hardware wallet in partnership with Ledger. Blockchain is also launching a new trading platform called Swap — this platform will find the best trading prices across a variety of exchanges and liquidity pools so that you can exchange tokens at a fair price straight from your Blockchain account.

Blockchain is one of the most successful cryptocurrency wallets out there. The company has built a solid user base with a software wallet for Bitcoin, and now also Ethereum and Bitcoin Cash.

Compared to traditional exchanges, you remain in control of your private keys. Blockchain can’t access your tokens, hackers can’t empty your wallet if Blockchain gets hacked. Blockchain currently manages 30 million wallets, which represent over $200 billion in transaction volume in the last two years.

But a software wallet isn’t as secure as a hardware wallet. There have been countless of phishing attempts and scams to take over your private keys. That’s why Blockchain is going to release its own hardware wallet, sort of.

The company is partnering with French startup Ledger to release the Blockchain Lockbox. It looks exactly like the Ledger Nano S, but with a Blockchain logo. It’ll feature a customer Blockchain firmware and integrate with Blockchain’s wallets.

Just like Ledger’s own app, you’ll be able to check your balance without connecting your hardware wallet to a computer. But as soon as you want to process a transaction, you’ll need to plug your Ledger wallet to confirm the transaction on the device itself.

It’ll be interesting to see how your Blockchain wallet and the one tied to your Blockchain Lockbox work together. The Lockbox could act as a sort of longterm vault while you could keep some coins on your standard Blockchain wallet for frequent transactions.

As for Swap, Blockchain is building its own trading product. It’s not going to be a separate exchange as the company plans to integrate with multiple sources. Eventually, Blockchain hopes to add support for decentralized exchange protocols so that you can exchange tokens without going through an exchange.

The Blockchain Lockbox will cost $99 and start shipping in November. I hope there will be other versions that support Bluetooth and mobile phones in the future as Blockchain is quite popular on mobile.

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Committed to privacy, Snips founder wants to take on Alexa and Google, with blockchain

Posted by | Alexa, Amazon, blockchain, cryptocurrency, Developer, Europe, Gadgets, Google, siri, Snips, Startups, TC | No Comments

Earlier this year we saw the headlines of how the users of popular voice assistants like Alexa and Siri and continue to face issues when their private data is compromised, or even sent to random people. In May it was reported that Amazon’s Alexa recorded a private conversation and sent it to a random contact. Amazon insists its Echo devices aren’t always recording, but it did confirm the audio was sent.

The story could be a harbinger of things to come when voice becomes more and more ubiquitous. After all, Amazon announced the launch of Alexa for Hospitality, its Alexa system for hotels, in June. News stories like this simply reinforce the idea that voice control is seeping into our daily lives.

The French startup Snips thinks it might have an answer to the issue of security and data privacy. Its built its software to run 100% on-device, independently from the cloud. As a result, user data is processed on the device itself, acting as a potentially stronger guarantor of privacy. Unlike centralized assistants like Alexa and Google, Snips knows nothing about its users.

Its approach is convincing investors. To date, Snips has raised €22 million in funding from investors like Korelya Capital, MAIF Avenir, BPI France and Eniac Ventures. Created in 2013 by 3 PhDs, and now employing more than 60 people in Paris and New York, Snips offers its voice assistant technology as a white-labelled solution for enterprise device manufacturers.

It’s tested its theories about voice by releasing the result of a consumer poll. The survey of 410 people found that 66% of respondents said they would be apprehensive of using a voice assistant in a hotel room, because of concerns over privacy, 90% said they would like to control the ways corporations use their data, even if it meant sacrificing convenience.

“Сonsumers are increasingly aware of the privacy concerns with voice assistants that rely on cloud storage — and that these concerns will actually impact their usage,” says Dr Rand Hindi, co-founder and CEO at Snips. “However, emerging technologies like blockchain are helping us to create safer and fairer alternatives for voice assistants.”

Indeed, blockchain is very much part of Snip’s future. As Hindi told TechCrunch in May, the company will release a new set of consumer devices independent of its enterprise business. The idea is to create a consumer business that will prompt further enterprise development. At the same time, they will issue a cryptographic token via an ICO to incentivize developers to improve the Snips platform, as an alternative to using data from consumers. The theory goes that this will put it at odds with the approach used by Google and Amazon, who are constantly criticised for invading our private lives merely to improve their platforms.

As a result Hindi believes that as voice-controlled devices become an increasingly common sight in public spaces, there could be a significant shift in public opinion about how their privacy is being protected.

In an interview conducted last month with TechCrunch, Hindi told me the company’s plans for its new consumer product are well advanced, and will be designed from the beginning to be improved over time using a combination of decentralized machine learning and cryptography.

By using blockchain technology to share data, they will be able to train the network “without ever anybody sending unencrypted data anywhere,” he told me.

And ‘training the network” is where it gets interesting. By issuing a cryptographic token for developers to use, Hindi says they will incentivize devs to work on their platform and process data in a decentralized fashion. They are starting from a good place. He claims they already have 14,000 developers on the platform who will be further incentivized by a token economy.

“Otherwise people have no incentive to process that data in a decentralized fashion, right?” he says.

“We got into blockchain because we’re trying to find a way to get people to participate in decentralized machine learning. We’ve been wanting to get into consumer [devices] for a couple of years but didn’t really figure out the end goal because we had always had this missing element which was: how do you keep making it better over time.”

“This is the main argument for Google and Amazon to pretend that you need to send your data to them, to make the service better. If we can fix this [by using blockchain] then we can offer a real alternative to Alexa that guarantees Privacy by Design,” he says.

“We now have over 14000 developers building for us and that’s really completely organic growth, zero marketing, purely word of mouth, which is really nice because it shows that there’s a very big demand for decentralized voice assistance, effectively.”

It could be a high-risk strategy. Launching a voice-controlled device is one thing. Layering it with applications produced by developed supposedly incentivized by tokens, especially when crypto prices have crashed, is quite another.

It does definitely feel like a moonshot idea, however, and we’ll really only know if Snips can live up to such lofty ideals after the launch.

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Robinhood aims at IPO as the fintech startup seeks CFO

Posted by | Apps, baiju bhatt, cryptocurrency, disrupt sf 2018, Exit, Fundings & Exits, initial public offering, IPO, Mobile, Robinhood, Startups, TC | No Comments

Now valued at $5.6 billion, zero-fee stock trading app and cryptocurrency exchange Robinhood is starting preparations to go public. Just a year and a half ago, it was still largely under the radar. But then it raised a $110 million Series C at a $1.3 billion valuation in April 2017 and then just a year later scored a $363 million Series D, both led by Russian firm DST Global. Combined with the growth of its premium subscription for trading on margin called Robinhood Gold, the startup now has the firepower and revenue to make a viable Wall Street debut.

Today during Robinhood CEO Baiju Bhatt’s talk at TechCrunch Disrupt SF, he revealed that his company is on the path to an IPO and has begun its search for a chief financial officer. It’s also undergoing constant audits from the SEC, FINRA and its security team to make sure everything is kosher and locked up tight.

The CFO hire could help the five-year-old Silicon Valley startup pitch itself as the cheaper youthful alternative to E*Trade and traditional stock brokers. They’d also have to convince potential investors that even though cryptocurrency prices are in a downturn, allowing people to trade them for cheaper than competitors like Coinbase is a powerful user acquisition funnel.

Robinhood now has 5 million customers tracking, buying and selling stocks, options, ETFs, American depositary slips receipts of international companies and cryptos like Bitcoin and Ethereum. That’s twice as many customers as its incumbent competitor E*Trade despite it having 4,000 employees compared to Robinhood’s 250.

The startup has raised a total of $539 million to date from prestigious investors like Andreessen Horowitz, Kleiner Perkins, Sequoia and Google’s Capital G, allowing it to rapidly roll out products before its rivals can react. This rapid rise in valuation can go to some founders’ heads, or crush them under the pressure, but Bhatt cited “friendship” with his co-CEO Vlad Tenev as what keeps him sane.

The startup has three main monetization streams. First, it earns interest on money users keep in their Robinhood account. Second, it sells order flow to stock exchanges that want more liquidity for their traders. And it sells Robinhood Gold subscriptions which range from $10 per month for $2,000 in extra buying power to $200 per month for $50,000 in margin trading, with a 5 percent APR charged for borrowing over that. Gold was growing its subscriber count at 17 percent per month earlier this year, showing the potential of giving trades away for free and then charging for extra services.

But Robinhood is also encountering renewed competition as both startups and incumbents wise up. European banking app Revolut is building a commission-free stock trading, and Y Combinator startup Titan just launched its app that lets you buy into a  managed portfolio of top stocks. Finance giant JP Morgan now gives customers 100 free trades in hopes of not being undercut by Robinhood.

Over on the crypto side, Coinbase continues to grow in popularity despite its 1.4 percent to 4 percent fees on trades. It’s rapidly expanding its product offering and the two fintech startups are destined to keep clashing. Robinhood may also be suffering from the crypto downturn, which is likely dissuading the mainstream public from dumping cash into tokens after seeing people lose fortunes as Bitcoin and Ethereum’s prices tumbled this year.

There’s also the persistent risk of a security breach that could tank Robinhood’s brand. Meanwhile, the startup uses both human and third-party software-based systems to moderate its crypto chat rooms to make sure pump and dump schemes aren’t running rampant. Bhatt says he’s proud of making cryptocurrency more accessible, though he didn’t say he felt responsible for prices plummeting, which could mean many of Robinhood Crypto’s users have lost money.

Fundamentally, Robinhood is using software to make the common but expensive behavior of stock trading much cheaper and more accessible to a wider audience. Traditional banks and brokers have big costs for offices and branches, trading execs and TV commercials. Robinhood has managed to replace much of that with a lean engineering team and viral app that grows itself. Once it finds its CFO, that could give it an efficiency and growth rate that has Wall Street seeing green.

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Coinbase acquires Distributed Systems to build ‘Login with Coinbase’

Posted by | Apps, blockchain, coinbase, cryptocurrency, decentralized apps, Exit, Fundings & Exits, M&A, Mobile, Social, Startups | No Comments

Coinbase wants to be Facebook Connect for crypto. The blockchain giant plans to develop “Login with Coinbase” or a similar identity platform for decentralized app developers to make it much easier for users to sign up and connect their crypto wallets. To fuel that platform, today Coinbase announced it has acquired Distributed Systems, a startup founded in 2015 that was building an identity standard for dApps called the Clear Protocol.

The five-person Distributed Systems team and its technology will join Coinbase. Three of the team members will work with Coinbase’s Toshi decentralized mobile browser team, while CEO Nikhil Srinivasan and his co-founder Alex Kern are forming the new decentralized identity team that will work on the Login with Coinbase product. They’ll be building it atop the “know your customer” anti-money laundering data Coinbase has on its 20 million customers. Srinivasan tells me the goal is to figure out “How can we allow that really rich identity data to enable a new class of applications?”

Distributed Systems had raised a $1.7 million seed round last year led by Floodgate and was considering raising a $4 million to $8 million round this summer. But Srinivasan says, “No one really understood what we’re building,” and it wanted a partner with KYC data. It began talking to Coinbase Ventures about an investment, but after they saw Distributed Systems’ progress and vision, “they quickly tried to move to find a way to acquire us.”

Distributed Systems began to hold acquisition talks with multiple major players in the blockchain space, and the CEO tells me it was deciding between going to “Facebook, or Robinhood, or Binance, or Coinbase,” having been in formal talks with at least one of the first three. Of Coinbase the CEO said, they “were able to convince us they were making big bets, weaving identity across their products.” The financial terms of the deal weren’t disclosed.

Coinbase’s plan to roll out the Login with Coinbase-style platform is an SDK that others apps could integrate, though that won’t necessarily be the feature’s name. That mimics the way Facebook colonized the web with its SDK and login buttons that splashed its brand in front of tons of new and existing users. This turned Facebook into a fundamental identity utility beyond its social network.

Developers eager to improve conversions on their signup flow could turn to Coinbase instead of requiring users to set up whole new accounts and deal with crypto-specific headaches of complicated keys and procedures for connecting their wallet to make payments. One prominent dApp developer told me yesterday that forcing users to set up the MetaMask browser extension for identity was the part of their signup flow where they’re losing the most people.

This morning Coinbase CEO Brian Armstrong confirmed these plans to work on an identity SDK. When Coinbase investor Garry Tan of Initialized Capital wrote that “The main issue preventing dApp adoption is lack of native SDK so you can just download a mobile app and a clean fiat to crypto in one clean UX. Still have to download a browser plugin and transfer Eth to Metamask for now Too much friction,” Armstrong replied “On it :)”

On it 🙂

— Brian Armstrong (@brian_armstrong) August 15, 2018

In effect, Coinbase and Distributed Systems could build a safer version of identity than we get offline. As soon as you give your Social Security number to someone or it gets stolen, it can be used anywhere without your consent, and that leads to identity theft. Coinbase wants to build a vision of identity where you can connect to decentralized apps while retaining control. “Decentralized identity will let you prove that you own an identity, or that you have a relationship with the Social Security Administration, without making a copy of that identity,” writes Coinbase’s PM for identity B. Byrne, who’ll oversee Srinivasan’s new decentralized identity team. “If you stretch your imagination a little further, you can imagine this applying to your photos, social media posts, and maybe one day your passport too.”

Considering Distributed Systems and Coinbase are following the Facebook playbook, they may soon have competition from the social network. It’s spun up its own blockchain team and an identity and single sign-on platform for dApps is one of the products I think Facebook is most likely to build. But given Coinbase’s strong reputation in the blockchain industry and its massive head start in terms of registered crypto users, today’s acquisition well position it to be how we connect our offline identity with the rising decentralized economy.

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Opera adds a crypto wallet to its mobile browser

Posted by | Apps, computing, cryptocurrency, freeware, Mobile, online identity, online payments, Opera, Password, Software, TC, telenor, Wallet | No Comments

The Opera Android browser will soon be able to hold your cryptocurrencies. The system, now in beta, lets you store crypto and ERC20 tokens in your browser, send and receive crypto on the fly, and secures your wallet with your phone’s biometric security or passcode.

You can sign up to try the beta here.

The feature, called Crypto Wallet, “makes Opera the first major browser to introduce a built-in crypto wallet” according to the company. The feature could allow for micropayments in the browser and paves the way for similar features in other browsers.

From the release:

We believe the web of today will be the interface to the decentralized web of tomorrow. This is why we have chosen to use our browser to bridge the gap. We think that with a built-in crypto wallet, the browser has the potential to renew and extend its important role as a tool to access information, make transactions online and manage users’ online identity in a way that gives them more control.

In addition to being able to send money from wallet to wallet and interact with Dapps, Opera now supports online payments with cryptocurrency where merchants support exists. Users that choose to pay for their order using cryptocurrency on Coinbase Commerce-enabled merchants will be presented with a payment request dialog, asking them for their signature. The payment will then be signed and transmitted directly from the browser.

While it’s still early days for this sort of technology it’s interesting to see a mainstream browser entering the space. Don’t hold your breath on seeing crypto in Safari or Edge but Chrome and other “open source” browsers could easily add these features given enough demand.

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