December’s AMA Recap: The Nexo Wallet
The Nexo Wallet, our advanced Web3 and DeFi non-custodial wallet solution stole the spotlight in this month’s AMA and deservedly so. Nexo Co-Founder and Managing Partner Antoni Trenchev sat down with Product Owner Elitsa Taskovа for a deep dive on the Nexo Wallet, answering burning questions from our community. The innovations and solutions it offers made for a truly DeFinitive AMA session – read on and catch up on some of the hot topics discussed.
Q (5:10): With many wallets already available, how does Nexo aim to differentiate its wallet from the others?
Elitsa: We have the approach “Do as much as possible or nothing” and we proved that with our custodial 360-degree solution. Now we want to replicate that on-chain and it’s very different from the existing solutions in the space, because they focus on one particular chain or a particular feature. We, on the other hand, want to provide a holistic, 360-degree solution as we already do on our custodian platform.
We all know the pain of gas fees – the fact that every transaction on the blockchain has gas to be paid. Another one is the fact that you have to hold your native coins in your wallet to pay for that gas on any particular blockchain. Those two problems can be solved with smart contracts and we already did it with the option to batch transactions. By batching, you can really save on gas fees and we introduced a way to pay the gas fee with any coin you have in your wallet so you don't have this blocker to really use all features.
The second and probably the most important part is around security and smart contracts. One of the main problems is the recoverability of the wallet and smart contracts give us the opportunity to solve this problem by enabling not only the signers, but creating “guardians”. The so-called guardians will give you the option to recover your keys in case you lose them. Smart contracts provide you with the confidence that you are the only one to access and manage your funds.
The last part I want to cover is around identity. Having an identity in Web3 will give you this sovereign way to use your funds and your personal data. If I have to make parallels with Web2, we all know the social networks that hold your data and you cannot transfer it easily from one platform to another. That's yet to be solved in Web3 and we want to be the solution, to be there when that happens both for the financial part and the personal data part.
Q (10:46): How does the non-custodial wallet fit into the wider product strategy specifically in terms of generating revenue for the company?
Antoni: We have a good competitive advantage that we have a non-custodial solution and a traditional custodial solution. I think that the two can be interoperable in a way that will be easy to switch from one to the other, so that you can do as much as possible from similar interfaces and user experiences. We as a company strike a very nice balance between offering products for both sides of the equation. I don't think that the initial point of this product is to instantly make money – we are a company that listens to the clients and we had a lot of requests.
Q (14:40): Which tokens will be available for staking in yield? Is there any utility for the Nexo Token? Will we be able to connect a Ledger device to it?
Elitsa: We will try to enable our staking solution on our custodian platform around the Еthereum staking service, which is a fully decentralized service, but we decided to plug it into our custodian solution, because we see desire for such a product.
We will support five EVM-compatible networks, so once we start increasing the number of networks, we will naturally add also the staking component. We also decided to reduce the friction of importing tokens and that's why there will be 250 whitelisted so you can easily use our supported decentralized exchanges to swap those or deploy themin different protocols.
Yield generation will come in different forms – we will also introduce liquidity provision, which means that you won't be required to use a dApp browser to access different protocols.
We entertain our thoughts around a tokenized world program. What we imagine is a way to capture and tokenize the entire crypto journey of any user and reward you based on that – a tokenized version of our world program and the Nexo token will be at the heart of it as always. Ledger is something we will support as a signer as and as a wallet to aggregate your balances under your identity in our world.
Q (23:12): Announced features suggest the wallet will use smart contracts instead of EOS. How involved will Nexo be with contract interactions on behalf of users?
Elitsa: The identity is indeed controlled by a smart contract and what's important here is the fact that the identity cannot be created nor managed without a non-custodial wallet. The creation of this non-custodial wallet proves that ultimately you'll be the one to manage that identity because you're the owner of the signer of this wallet.
You can entrust your many wallets – if for example you lose your seed phrase for one particular wallet, but you created an identity which combines many of them, then you can recover your identity and your wallets with another wallet that you already entrusted, which is the best possible outcome.
There are some ways for us to also double-down on security – we are undergoing an audit and we want to make multiple audits on our smart smart contracts, which will verify the mechanisms in place that manage the signers’ and guardians’ logic. Open-source is also something we discuss internally – at least that part which is related to the signers management.
Q (32:46): Does Nexo have ambitions to become more DeFi or is this new wallet a standalone product?
Antoni: We have the centralized offering and we now have a decentralized offering – we are going to intertwine those two and make them as interoperable as possible. I think this is the ultimate sweet spot so that we cater to those who need solutions in one division and also anything in the other. This is super exciting to us. My ultimate dream is one day to have as many trustless things as possible – it won’t be a smooth path and it won’t happen tomorrow, but it’s the ultimate goal to pursue.