ZenGo: Your Crypto Wallet Solution With Ouriel Ohayon
Security is always key when dealing with any currency. That includes cryptocurrency which has already become as vulnerable as traditional currency. In this episode, Ouriel Ohayon, the CEO of ZenGo, an innovative new crypto wallet solution, shows us the capability of their software. He shares what makes ZenGo innovative and simple, and why you should download it over other similar apps. Experience security that will give you peace of mind as Ouriel dives more into crypto security and how ZenGo delivers its purpose to the US, Europe, and many other countries across the globe.
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ZenGo: Your Crypto Wallet Solution With Ouriel Ohayon
I’m with Ouriel Ohayon, the CEO of ZenGo, an innovative new crypto wallet solution that I’m excited to hear more about. Thank you so much, Ouriel, for joining us.
Thanks, Monika. It’s a pleasure.
I would love to learn more about what you’ve been doing at ZenGo. It sounds like you’ve been making progress at a pretty significant clip. Can you tell me more about ZenGo and how you got started?
ZenGo is a crypto wallet that we launched a few months ago. We’ve been working on the project for two years. There was a lot of significant research behind it. It’s a very simple product. It’s a mobile app that you download on your phone. It helps you store, send, receive and buy cryptocurrencies. It does that in an unprecedented, simple and secure way. We’ve tried to significantly augment the past to reduction of crypto, but also listening to the complaints of new crypto users, which were subjected to hacks, errors and crypto loss and things like that. We wanted to also bring up something that was a better solution that the hundreds of variants of crypto wallet that there is on the market. This is what we do.
How did you make something that was very distinguished, different and even harder to hack? What are some of the main components of what makes your wallet so innovative and simple?
Let’s first look at the market as it is now. A typical crypto wallet, whether this is a software wallet or a hardware wallet, you can also buy that from a hardware relies upon the user to manage his own security and his private key. I’m assuming your audience knows what a private key is. Otherwise, we need to get into crypto directly. This is the key to ownership and to spend your Bitcoin or Ethereum or whatever assets you have. This is what you are required to keep safe as long as you own these assets. Typically, when you create a new crypto wallet, they will ask you to store that private key. It could be done in very various ways, but typical experience will be to write down a set of 24 words to rewrite them, verify them and store them somewhere safe.
No one will tell you what somewhere safe means. You have to figure it out by yourself and you have to trust yourself that it’s going to be the right way. At some point, you realize that you are not the security expert that you are. You wrote it the wrong way. You put it in the software that was not secure. You don’t remember where it was. You have a new iPhone 11. You restored your old phone. The money is not there and the money has gone forever. This is a very common scenario and the other scenario is people trust more exchanges with their friends. It’s more convenient. The exchanges are centralized honeypots. The day they get hacked and which has happened very often now, the money’s gone forever.
Some of them claim insurance, but most of the time, the insurance is fractional so your money is gone forever too. This is the world as we know it now meaning you have to pick your poison. You either die by your own doing or by the doing of someone else. We didn’t want anyone to die. We wanted to have something that enables people to thrive in what could be the next revolution of the economy. We looked at all the existing solutions and we could not figure out something that would be at the same time an augmentation in user experience and security. We had to take a blank page and look at the new fundamentals at the cryptographic layer. The typical crypto wallets rely on public, private cryptography. As long as the private key is required and the security is revolving around the private key, we could not find a solution that would work for what we were imagining.No one will tell you what 'somewhere safe' means. You have to figure it out by yourself. Click To Tweet
We took a blank page and started from scratch. We use a sign that has been around for 30 years called multiparty computation. The basic principle is that the secret is distributed between parties without exposing their own secrets. They can perform together some computation. In our case, the computation is simple, it’s private key management. It’s the notion of owning and managing together secrets to sign a transaction. We wanted to build a wallet where at the same time the user would be complete control, but it would never be alone to handle its own security. We wanted to build a wallet based on that principle, which sounded promising. The bad news was that at the time when we started, it was no one will ever get something like that. There were no libraries. There was open source code. There were no existing wallets performing.
That’s why we have to build everything from scratch. There was a lot of research before we arrive to the extreme simple reason that we are in. ZenGo is the word that is using multi-party computation and what’s called as a derivation of MPC, Multi-Party Competition threshold signatures. For the user, what it means is you will have an extremely simple wallet where no password is required. More importantly, it’s a wallet that you can recover nearly every situation including in the case that we get out of business as a company. He has the guarantee that it’s only him as a user can access his wallet. We are using also deep biometrics versus any other wallet where usually if someone has your password, it’s game over.
There is a lot of innovation, not at the crypto graphic layer but also at the fundamental security user experience. We consider that user experience is security. Security is user experience. They go together. They’re not a separate chapter. We’ve built that application, which has been launched a few months ago. We progressively did more and more features to that wallet, more assets. We’re supporting Bitcoin, Ethereum. We were the first one in the world to support the Libra Test Network. It has attracted a lot of attention around us. We are enabling people to buy of those assets in matter of seconds from within the wallet with a credit card. That’s basically the fundamental functions of the wallet now.
You talked about how user experience is security and security is user experience. Can you talk a little bit more about that as it relates to this new threshold signature? How does that work?
Typically, when a wallet is generated, you will have a couple of public and private key generated together. They are tied together. To sign transactions, you need to have these private keys so you can sign the transaction, broadcast it to the blockchain, whatever blockchain it is. That’s the world as we know it. In threshold signature, when a wallet is generated, no private key is ever generated. There is no private key to hack or there is no privacy key to lose. This is very important to understand because sometimes people make the confusion. It’s a secret where a private key is generated and then split.
Here there is no private key ever generated. Instead we are generating independent mathematical operations on independent devices. In our case, it’s going to be your mobile phone and the server of ZenGo. Independent mathematical operations are generated. They are never going to be run in the same place. They are never going to be exposed to each other. We are using a lot of zero knowledge proofs and I will pass on the technical terms. What’s going to happen is by iteration, encrypted integration. They’re going to perform the same role as one of the private keys. They’re going to be able to together sign transactions to the blockchain.
Those are the multiparty. Essentially, we have one party that’s held in the mobile device and one party that’s held somewhere else. Is it difficult when there are only two parties in a multi-party computation or is it preferable to have six parties in a multiparty computation? I think about a blockchain meeting to have multiple nodes to be more secure. Wouldn’t that also hold true? You would need more than two?
Now, it’s extremely hard to perform multiparty computation even at two parties. There’s already a challenge to achieve that level. We are going to release small parties in the future. We have already the code for it. The challenge is performance and security as always. You can have many parties involved. The problem is if you have many parties involved, you need packed transaction time and transaction signature. There is a question of user experience. Are people ready to wait 10 minutes or 20 minutes for a signature to be signed? Here we’ve managed to build the first ever crypto wallet with 2 parties or 2 out of 2, which is extremely fast.
It’s super snappy. You don’t feel even the amount of calculation that is done behind the scene and iteration between the parties. That is extremely smooth. If we involved in more parties, which we will in the future, we involve more time, which we plan to do it only if we can guarantee speed and security. For now, it’s 2 out of 2, which is already in itself an achievement. We have that now. Those two parties sign and the transaction is broadcasted. To the blockchain, it’s identical. It’s agnostic to the fact that we’ve done that. We don’t require any change.
How did you end up getting into this to begin with? How long have you been at this and what were you doing before? At what point did you get involved with ZenGo specifically?
I don’t have a great story to tell. I know like many entrepreneurs the way they tell is fantastic. There were amazing mythological moments, where they discovered crypto because of their parents were. They were in the poor country and they lost all their money. I stumbled upon it very late. I am ashamed to admit it. I was moving back from the US back to Israel. I was starting to think about what to do next. I was running out of ideas. I stumbled upon the podcast that opened my eyes. It was not a crypto podcast. It was the podcast unrelated to crypto but talking about the advancement of cryptography and duplication at every single level of the society. The fact that we were building a trustless society and all the applications around cryptography.
I realized that it was not the Bitcoin, which was at the time the buzz word. The fact that you can use it for money. For me, there was like a revelation moment that this was a huge revolution that would apply to every single level of the society, including the parliament. I wanted to be part of that. I’ve been involved for many years in nearly every single technological revolution, the revolution of the web that arrived on the desktop. When I was in my first company, I saw the revolution of social media. I was the Founder of TechCrunch in France. I saw the birth of blogs and social networks.
I saw the birth of mobile and mobile apps, which was my prior company. When I saw that, I said, “I cannot miss that revolution.” It’s probably the biggest one that I will ever see in my lifetime. I want to be part of it. I got more curious about it. At some point, I realized that the solutions that were required to start with crypto were not good enough. It was like in what we described before. It was very tedious and looked very pre-historical to me compared to what was expected. I decided that it was an important program to spend my time on. I decided to look for a team and we started to build it.
When did this happen? What year was this?
It was about a few years ago. Everything went very fast. When I decide to do something, I don’t waste time and I zoom in very deep. The funny part is I have to admit that a few years ago, I was listening to the podcasts talking about crypto, which I’m participating on to tell what I’m doing. What an achievement to the next level. We started a few years ago for one year we worked without funding. It was self-funded. We worked night and day to make our first workable prototype to build an MPC-based wallet. Once we got the conviction that we could build something that is quality, we knew that we had the possibility to build a company. We went after investors very quickly. We got funded. We created the company. During the ten months, we build the first version of what is live in the app store.
When you say live on the app store, people can use their credit card to purchase crypto. Did you run into regulatory issues in different jurisdictions around that? Did you wait and hit it late enough that all of those things had been worked out?You either die by your own doing or by the doing of someone else. Click To Tweet
It’s a very important point. Compliance and regulation are one of the hammers that every entrepreneur in the space is up in his head. Luckily for us, we are building a noncustodial wallet so meaning that the funds are on chain and controlled by the user. We are enabled to spend the funds even if we are multi-party and part of the co-signature. This is proven cryptographically. We are saved by this architecture and not to be like a money service business and having all the compliance. For the purchase of crypto, we partner with a liquidity provider, which handles all the compliance with respect to KYC and AML. You cannot buy crypto without a piece of ID that you have to provide except if you buy low amounts. If you buy less than €200, you will not be required to provide a piece of ID. That makes the experience super smooth in 60 seconds with Apple Pay, which is integrated, you can buy your crypto. There is no easy way to buy crypto. It’s much easier than any other service on the planet. That facilitates a lot first steps for someone who wants to start.
This €200 threshold, is that something that the European governing body is determined or is that across the globe? Is that the same as approximately a similar amount of money invested in the US would be fine as well for US user? Did you find that was specific to European users?
It’s specific to European users. The service is not yet available in the US. In the US, it will be different. Also, there is no regulation or law that says it should be €200 or not. It’s an assessment of liability and risk that has been taken. Also, it’s not €200 every day or every amount, it’s capped per month. You cannot like go by €200, €200. You accumulate like that €10 million. Without KYC, that would be a risk. This is kept at least for now and this is a fine way to get started. As you buy your crypto, it gets immediately delivered into your ZenGo wallet. You’d get a real time that it arrived. You don’t have to wait and check every 5 minutes or every 5 seconds if your funds have arrived when the network, for example is busy. It’s to find and sweet experience for customers.
As a US user, I can’t download this in the app store yet. It’s only available in what countries right now?
It’s available everywhere. You can download ZenGo in any country in the world. In China because China, there are rules on crypto apps.
The KYC issue is what is specific to European users. Otherwise, it’s going to be KYC across the board no matter what.
The purchase is available in 38 countries. We released in Japan and Brazil. The US will be releasing in the next couple of weeks, something like that. For now, we’re touching all those countries in Europe, Korea, Brazil and some other countries in the world. It’s already covering a large number. If you want to use the wallet, anyone in the world can download it from the app store.
I can go to the app store and I would search for ZenGo, be able to download the wallet. That sounds wonderful. I have a couple of questions about your background. I know that you are involved in tech this entire time. Is that because you got involved in tech straight out of college? Did you end up as an entrepreneur with a different technical background? What was your background initially?
I’m not a technical person. I’ve never been and I will never be. I’m not that smart enough probably. I do have frequent founders that are extremely technical and competent. One for cryptography, one for security and research and one for engineering. They are brilliant in their own field. I’ve been more in the other side of the coin, no pun intended. I’ve always been on the business side. I have a very strong background for anything related to product, design, marketing, business development and funding.
Did you study business?
Yes, I went to business school in France. I’m finished my studies in Spain where I worked for two years. I started my career not in tech. I worked for a very traditional marketing-oriented companies for the product that you buy in supermarkets. I’ve done that, but very quickly I realized that I had the tech bug. I wanted to be part of that field. In the early days of the web, I created my first company and that was a long process. I had many years or so on the other side of tech, which means investing in startups. I worked in venture capital for a few years. I also co-founded one of the leading venture fund in France, which is one of the top performing, not just in France but in Europe. I’ve seen the other side also what it means to work as an entrepreneur. At some point, I decided that I wanted to be an entrepreneur again. This is what I do now.
Once you get the bug, it’s hard to get rid of it. Is there anything else that you would like to touch on to make sure that we cover about this wallet before we sign off?
This is surprising, but I would like your audience not to try our wallet first. I would like them to try any other wallets so download any wallet that you want. Feel the pain and you feel it very quickly. I’m saying that with a certain level of confidence and once you have done that. I usually encourage, if you want to learn to play the violin, the best way to learn to play the violin is not to start with scales and everything. Buy a good couple of boxing gloves, two different boxing gloves, try to play the violin. It’s going to be very hard because you’re not trained to manage. Remove them and you find it very easy. The equivalent of the boxing glove is try any other wallets. Once you’re done, you use ZenGo and you will realize that it’s like playing violin for the first time. Hopefully, you would like it.
Thank you so much. This has been wonderful learning about the ZenGo wallet and how much easier it’s going to make it for users to experience. I feel like driving adoption and making the whole cryptos experience is a huge part of getting everything else crypto has got to ride on the backs of user adoption. I thank you for having the innovation to make a better interface for people to have a secure way of storing their crypto.
It’s my pleasure and tell us what you think. The best way to find out about it is ZenGo.com.
It’s been a pleasure, Ouriel. Thank you again for being on the show.