Cryptocurrency exchange Coinbase has launched a new business solution for companies wishing to offer Web3 wallets to their customers, a move it claims will help speed up the adoption of Web3 products and services.
Coinbase’s wallet-as-a-service, or WaaS, provides businesses with the technical infrastructure to create and launch customizable on-chain wallets, the exchange announced March 8. Specifically, WaaS provides a wallet application programming interface (API) that allows businesses to create wallets for simple customer onboarding, loyalty programs, or in-game purchases.
The WaaS toolset incorporates multi-party computation (MPC), a form of cryptography that allows multiple parties to jointly compute a function without revealing their input data to the others. In practice, the MPC improves the security of private keys on Web3 platforms. An MPC wallet allows users to store their digital assets more securely because their private keys are divided into multiple parts and distributed among the parties involved in the protocol.
According to Coinbase, Web3 wallets have struggled to gain wider acceptance due to their complexity, poor user experience, and challenges associated with maintaining mnemonic seeds.
Imagine your seed phrase is now public information. What do you do next? https://t.co/BNTEjaCMaM
— Cointelegraph (@Cointelegraph) December 20, 2022
The WaaS infrastructure of the cryptocurrency exchange is currently being used by companies such as Floor, Moonray, thirdweb, and tokenproof.
Web3 infrastructure development seems to be heating up in the dead of crypto winter, as startups, corporations, and investors seek to define the future vision of the decentralized Internet. While not everyone is convinced that the current modalities of Web3 advance decentralization principles, developments around MPC and decentralized privacy suggest that many in the industry are taking it seriously.
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