News today on our portfolio company MobileCoin: Read Signal’s blog post here and the Wired article here.
In the last ten years, two parallel trends have emerged: Mobile P2P and group messaging, and crypto. While many have tried to introduce crypto-based P2P and e-commerce payments to popular messaging apps, nobody has cracked the code.
The marriage between mobile P2P and crypto is a powerful proposition: Bring together global communication with global payments. What could arise from this union? Fast P2P payments. Secure e-commerce. Fast & reasonably priced remittances. One possibility is realizing the crypto trope of “banking the unbanked”: In places where financial systems are weak but social messaging apps are mainstream, crypto-based P2P has the potential to create sudden and rapid financial connectivity.
We backed MobileCoin as investors because MobileCoin is the first real attempt to merge these two worlds. The protocol’s unique focus on privacy and transaction speed matches the instantaneous delivery model for popular apps worldwide. Mobilecoin will live inside these mainstream messaging apps, starting with the most cryptographically secure: Signal. As the first massively popular mobile messaging app to include MobileCoin for P2P and e-commerce payments, Signal is the best possible validation of MobileCoin’s privacy, security, and speed, just as Signal set the bar for end-to-end encryption within mobile messaging apps prior.
MobileCoin makes it easy for messaging apps to offer digital payments without compromising user privacy. By integrating a MobileCoin wallet, a mobile app can send transactions without maintaining a copy of the blockchain or sharing keys with a remote server. Transactions are final within just a few seconds, and all transactions are kept private.
MobileCoin takes a defense-in-depth approach to user privacy. This begins with established technologies like ring signatures, one-time addresses, and RingCT. They’ve added a suite of cutting-edge privacy tech on top of this existing foundation, from secure enclaves and information management designed to delete the final traces of Cryptonote on the blockchain. In MobileCoin, even if malicious attackers manage to compromise a node, they can never access user keys or data.
With this privacy layer at the heart of the protocol, MobileCoin also introduces microservices designed to enable mobile usage. This starts with MobileCoin Fog, a service run by apps to help find user transactions, check balances, and build new transactions, all without downloading the ledger (a prohibitively expensive task for mobile devices).
This is where cryptography gives users a feeling of security that no existing messaging app can provide: While Fog will be run by app providers, user privacy is entrusted to MobileCoin technology, not to the service provider. In other words, users don’t need to trust the company; they instead put their trust into the integrity of the MobileCoin Foundation’s open-source software.
We believe MobileCoin is the beginning of crypto’s marriage with mobile messaging apps. We hope to see far more experiments in the next year, as crypto marches us into a new era where users sleep at night with their faith in cryptography.