Welcome to the crypto age
It is impossible to talk about money today without talking about virtual currencies and the blockchain technology that is the infrastructure of that ‘virtual money’. Two Israeli companies, Kiribo and Zango, have created solutions that seek to address the complexity of the operation and the risks that exist in the crypto world.
The crypto market is a growing market that many compare its innovation and future impact, to the impact of the internet at the end of the last century. Experts in the field predict that in the coming years blockchain technology will touch every area of our lives, from using it as a means of payment, through tracking the movement of goods to registering assets on the blockchain (‘crypto taboo’).
Blockchain is a sophisticated computer technology invented by the developers of the first virtual currency – Bitcoin. It is a method of encryption (cryptography) of data in a way that enables open and secure business activity on the Internet and verification of transactions without the need for a central management entity.
The problem with using a blockchain is that it may be very secure, but not as simple and safe to use as a bank. There is no government body or bank overseeing the transfers behind it and can come to the aid of users in case of human error or fraud.
There is no government body or other responsible body behind the blockchain. The ‘ledger’ in which all asset transfers are recorded, is controlled by the user public and is secured at an unprecedented level. This mode saves bureaucracy, reduces costs and speeds up procedures (transfer between account holders in different countries in a few seconds instead of a few days). However, with the start of the use of the method, a number of worrying scenarios were discovered and some unfortunate cases occurred. For example, in the normal world, you can, relatively easily, deal with a case of losing your wallet containing your credit cards. If a person forgets his bank account number, you can contact the bank and get the number again, after an identification process. In the blockchain world in a similar case, there is no central-responsible factor that will help.
According to Assaf Naim, CEO of Kirobo, this is exactly where the company he founded in 2018 enters the picture: “We want to make blockchain operations as simple and secure as online banking. At the customer bank, they know that it is possible to stop transferring money to the wrong account in the event of a mistake. A customer who deposits all his capital in a bank, rest assured that after one hundred and twenty, his assets will be handed over to his legal heirs under the supervision of the court system and the authorities.
Banking system protections do not exist in the blockchain. Here, if you accidentally send a million dollars to the wrong address, there is no one to call, no central factor to contact. “In February 2021, for example, $ 682,000 was sent to the wrong addresses in 128 incorrect transactions. This is lost money. It is not even possible to find out the identity of the account holder to whom the money was transferred by mistake. This is a crazy barrier that is delaying the deployment and adoption of the method, “notes Naim.
Kirovo has developed technology that allows, among other things, to stop a transfer to the wrong account. Here’s how it works: Simultaneously with the transfer of the virtual currency, a security code is given to the recipient (similar to the identification code in SMS that has recently become commonplace). In order to complete the transfer, the receiving party needs to enter the code. If the transfer was made by mistake to the wrong person, then he will not be able to complete the transfer because he does not have the verification code. The transfer will be canceled after a set time or as soon as the account holder discovers the mistake he made and cancels the operation.
Kirovo has developed additional products of backup and inheritance. “We give backup on the assets and not on the wallet itself,” explains Naim. “That is, even if the wallet is lost – the assets are not lost. There are many stories about people who have huge sums in Bitcoin, but can not access them. About three years ago a billionaire was killed and virtual coins worth about $ 500 million stuck and heirs can not access them. These are things that our technology addresses. ” Kirovo’s Undo button works in both Atrium and Bitcoin and very soon they plan to add it to all ERC 20 currencies. That is, to 95 percent of all existing currencies.
Kiribo’s method creates a virtual wallet that ‘sits’ directly inside the blockchain and is controlled by the physical wallet that created it. If you lose access to the physical wallet, access to all the money is lost – but by adding a ‘smart’ programmable virtual wallet, you can change the situation. It can be determined, for example, that if the wallet is not opened for six months, the ownership will pass to another account holder that the customer has defined in advance. This way you can back up the assets and also bequeath them in a ‘will’, which is also kept in a blockchain.