As a Bitcoin* infrastructure investor turned Bitcoin infrastructure provider, I spend a lot of time speaking with builders in the Bitcoin space about issues that come up in Bitcoin application development. The fundamentals of Bitcoin are such that it can pull in the totality of IT and commerce into a Bitcoin based system that fuses information and value. Even a decade after its release, Bitcoin was a raw, untamed technology which presented great difficulties to app developers. In recent years, great strides have been made in making Bitcoin approachable for builders. But, the area where arguably the greatest innovation has occurred is still the place that is presenting the greatest challenges.
Wallets - Bitcoin’s Greatest Success and Failure
Most Bitcoin developers knew the number one issue before opening this article, wallets. Wallets are the gateway to Bitcoin. Wallets are the way most Bitcoin users manage their keys and the transactions those keys can unlock. Since Bitcoin best practices dictate using a unique key for each transaction, the challenge of securing users keys is a big one. Since the restoration of Bitcoin script in the February 2020 Genesis upgrade, wallets were opened up to far greater complexity as new transaction types now call for different forms of key and transaction management.
Challenges aside, wallets have made amazing strides in the past few years. Wallet companies like Money Button and RelayX have paved the way for a slick, single sign on experience for Bitcoin apps using a wallet. If you have a Money Button account, it is easy to sign into apps which have integrated Money Button and use your Bitcoin and keys within the app. RelayX has gone a step further by introducing an application directory within the wallet.
Powping is a Bitcoin social media app which uses Money Button for an easy single sign on experience
Some of the biggest steps forward in wallet technology have come from Handcash. Handcash’s incessant focus on simplifying Bitcoin user experience has led them to develop solutions like cloud signing and multi-party signatures. Combined with Handcash Connect, an SDK which makes integrating Bitcoin payments into an app exceptionally easy, Handcash users have access to the simplest, most powerful way of using Bitcoin to date.
A peak into a modestly funded Handcash wallet and its app directory
The Challenge for Developers
If your application does what wallets do well, then building on Bitcoin is becoming a fantastic experience. The problem is what to do if your application doesn’t do what wallets do well. Take, for example, the Metanet Protocol, released by Bitcoin R&D firm nChain in 2019.. Metanet is a way of structuring data on Bitcoin to create an on-chain internet. The problem is that wallets don’t support Metanet and its unique use of keys. Building an application using the Metanet protocol means that Money Button, RelayX, and Handcash aren’t going to be options. If your application uses Metanet, you are probably working on your own wallet right now, spending time duplicating many of the security features and user interfaces which already exist in other wallets.
Even if your application is well supported by current wallets, supporting multiple wallets is a challenge. Some application developers just support one wallet to keep things simple. This is far from ideal since it introduces risk that a killer app gets built with some other wallet and one’s application is cut off from these new users. Supporting multiple wallets isn’t much better since it requires multiple implementations of application logic to support each wallet.
It is worth mentioning that between the initial draft and final publication of this article, both Money Button and Handcash shipped major releases - Money Button releasing Fabriik token support and Handcash releasing a browser based wallet to complement their mobile app foundation
Our Project
At Unbounded Enterprise, we are focused on making it easier to build on Bitcoin. This means that we care a lot about the wallet issue. This article is the first of a series of articles addressing the challenge application developers face when choosing or building a wallet solution. We have interviewed and are continuing to interview Bitcoin builders, wallet companies included, about their ideas, needs, and solutions to the problems being faced today. If you want to contribute, please get in touch with us here.
*For Unbounded Enterprise, Bitcoin SV (BSV) is Bitcoin. Check out our blog post ”Why BSV?” to find out more.