There’s something refreshing, yet unsurprising, about a Bitcoin startup embracing open source.
As a currently trendy phenomenon, Bitcoin (and other cryptocurrencies) is not short on companies looking for ways to commercialize it, make a buck from it, and generally make it seem like any old commodity. But Bitcoin is decentralized at its core, which is why Y Combinator-backed Onename’s announcement that it’s opening up some of its software and is extending its protocol to decentralized authentication makes so much sense. Onename has also just raised $1.5 million in seed funding to help it do all that.
Founded by Ryan Shea and Muneeb Ali, Onename wants to make Bitcoin transactions easier by replacing the long wallet addresses and QR codes with a simple (you guessed it) name that you pick. You also have to use a Onename-compatible wallet, which currently includes RushWallet, KnCMiner, Electrum, Pheeva, Bitcoin Authenticator, and a few others.
One the downside for some people, you have to verify your identity through social media when creating an account, which sounds a bit counter to the anonymity of Bitcoin that many appreciate. Shea told VentureBeat via email that it’s just necessary in order to transact with people whose identity, not anonymous wallet number, you know.
“When you connect your various accounts to your Onename profile, you’re proving to others that the owner of that profile is in fact you. This becomes especially important when someone wants to send you Bitcoin or a private message and wants to make sure they’re sending it to the right Kia and not an impersonator,” he said.
Theoretically, as long as it’s consistent, even that social media-based identity could be an alias for someone, since it’s not tied to official documentation like a Social Security number.
One thing the startup is now opening up is the directory of people using Onename. In a blog post, the founders write:
The team is also open-sourcing some of the server-side tools it’s using on the backend.
In the bigger picture, the startup also announced Openname Auth, its approach to decentralized, password-free authentication that requires only an Openname to log in and approve authorization requests. What’s most interesting about Openname Auth is that Shea and Ali see it as a potential alternative to social media logins for anything, not just for Bitcoin- and cryptocurrency-related authorizations needs.
“Our goal is to be an alternative to login with Facebook and Twitter — one in which users are back in control of the information they release to applications, and one in which users are free from third parties tracking them all over the web,” Shea said in an email.
Of course, with the recent proliferation of Bitcoin and other cryptocurrencies, the Onename team isn’t alone in identity-related tools. 500 Startups graduate Bonafide is also taking a hack at it with its network for identity fraud prevention and reputation management.
Union Square Ventures led Onename’s seed round, with additional funding from Barry Silbert, Naval Ravikant, Cyan and Scott Banister, SV Angel, High Line Venture Partners, and others.
Onename is based in New York City and graduated from Y Combinator’s Summer 2014 batch.
VentureBeat is studying social media marketing tools. Chime in, and we’ll share the data with you.