I met Nithin Mani, the founder and CEO of Xoken Labs, at the recent CambrianSV event which was held this past February in Lisbon. CambrianSV is marketed as a Bitcoin Bootcamp, but it’s really more of an extended meetup for top Bitcoin entrepreneurs, many of whom could be found onstage at the Coingeek conference in London the following week, myself included. I was one of two VCs in attendance, the main perk of a modest sponsorship Unbounded Capital provided to the event.
During the first day, each of the entrepreneurs presented what they were working on to the group along with their progress goals for the week. I knew or knew of most of the entrepreneurs in attendance and their projects, but not Nithin or Xoken, and I sensed that I was not alone in my unfamiliarity. As Nithin began describing Xoken’s technology, I looked around the room to see if others were having a similar reaction to myself, one of some disbelief and immense excitement. Cambrian attendees are not easily impressed, and jetlag surely played a role in the mild response, but I firmly hold that Nithin’s full unveiling of Xoken, an event reserved for CambrianSV, was deserving of a standing ovation.
To understand why Xoken is such a game changer, some historical context is needed, both in Bitcoin’s broader history and Bitcoin SV’s relatively short one. Xoken’s first core product is an SPV solution. SPV, or simple payment verification, is a method of verifying that a Bitcoin transaction is included in the Bitcoin blockchain. SPV’s importance to Bitcoin is underscored by the fact that an entire section of the Bitcoin whitepaper is dedicated to SPV. In our view at Unbounded Capital, SPV is an essential component of Bitcoin’s unbounded scalability.
However, SPV has been largely discarded in Bitcoin’s history, particularly by Bitcoin Core (BTC). They assert that running a full node, tracking all Bitcoin transactions oneself, is more secure than using SPV and thus should be the standard approach. That view is akin to saying that Amazon shoppers should record a complete list of all sales in Amazon’s history rather than accept a receipt to use as proof of purchase. This type of mindset that seems to lack an awareness of cost/benefit analysis has caused Bitcoin’s scaling to stagnate, ultimately resulting in a Bitcoin landscape where SPV is not utilized.
Bitcoin SV and their commitment to scale has brought SPV back into the picture as a necessary component of a successful Bitcoin. However, in the early days of Bitcoin SV, there was no practical SPV solution. This led to a conflict about the scalability of applications which were utilizing non-SPV technologies. The degree to which those concerns are correct isn’t relevant, but the echoes of that conflict were certainly in the back of the minds of CambrianSV attendees.
That context is what made Nithin’s presentation so special. After a decade of SPV being neglected and months of concern about the scalability of non-SPV solutions on BitcoinSV, suddenly there was a functional SPV solution in the world. With the announcements at Coingeek London followed by the saga of COVID-19, Xoken’s announcement has been overshadowed, but in my view, its launch is the most significant development in the BSV space since the Genesis upgrade.
Xoken’s products reflect the qualities of the founder, Nithin Mani. They are courageous in subject and scope but pragmatic in execution. Nithin is the rare technical mind that can see the big picture from both a technological and economic perspective, identify what is missing, and then deliver an outstanding product. Xoken’s Nexa Node, the core of their SPV solution, is immediately a preeminent application architecture in terms of peer-to-peer scalability. Xoken’s Allegory and Allpay protocols will follow in becoming the most scalable and secure standard for on-chain namespaces, payments, and ultimately identity. I’m privileged to know enough about Xoken’s workings to be confident that these products won’t be the last time that Xoken creates something which elegantly fills a void in the Bitcoin SV architecture. A world that needs an updated, commercialized internet infrastructure is a world that needs Xoken and Nithin Mani. At Unbounded Capital we are extremely proud to be the first Xoken investor and we couldn’t be more excited to see what can be done with a new internet built on Bitcoin SV and on Xoken.