Developers can create customized wallets for their consumers using the stablecoin issuer’s service and API.
USD Coin issuer Circle announced a beta version of a multiparty computation (MPC) wallet service on Aug. 8. Decentralized finance (DeFi) apps, Web3 video games, e-commerce services, and other blockchain applications can construct personalized wallets for their users using the new service. Ethereum, Avalanche, and Polygon will launch it.
A decentralized network distributes a user’s private key into many shards to secure MPC wallets. Web3 developers use it. An API gives MPC wallets a “Web2 feel” that some developers and consumers like.
Circle’s blog post says developers may “choose the best wallet security and control configurations” with the new service. Some developers may wish to host their own MPC nodes to avoid dependence on Circle, while others may prefer to connect to Circle’s nodes. Developers can “share transaction signing responsibilities with the users” to recover lost keys or make the system noncustodial by asking users to sign every transaction.
Circle co-founder and CEO Jeremy Allaire believes the new service will boost USDC adoption:
“Circle’s Programmable Wallets is a new, core pillar of our strategy to advance global, mainstream utility and adoption of digital assets like USDC and public blockchain-based payments. Circle’s Web3 services begin with this new platform to alleviate developer pain points.”
The Multichain MPC bridge was hacked on July 7, leading investors to lose over $100 million in MPC wallets. The Multichain team then confirmed that all MPC shards were saved on the CEO’s cloud server.
Circle’s senior director of product management, Gagan Mac, told that the new service “is built and maintained in-house and doesn’t leverage external vendors,” meaning that it will not employ third-party cloud storage systems. Gagan also mentioned that “some developers and enterprises may prefer to host an MPC node,” which they can do. Multichain did not allow partners to host nodes.
Circle recently indicated that demand for euro-based stablecoins is rising and that a yuan stablecoin would be preferable to a Chinese central bank digital currency.