NuFi’s Plan to Onboard Millions to Cardano

The ‘Web2’ world is a scary place. Things are much more centralized there. In Web3, however, the average person has more autonomy, a little more freedom, if you will. How do we seamlessly yet securely connect these worlds? The NuFi team has a bright idea! They’ve submitted a Project Catalyst Fund10 proposal titled: “Onboarding Cardano’s next 1 million Web2 users: Connect to dApps by logging in with a social account or email address, via a non-custodial plug-n-play invisible wallet solution for dApps”. The NuFi team hopes to earn enough votes to receive funding so that they can build a new bridge between Web2 and Web3. 

Imagine this: you can log in and seamlessly access dApps using your social media accounts or email address. One of the unique attributes of this proposal is the idea of users enjoying Web3 without having to worry about setting up a wallet and keeping track of seed phrases; they don’t even have to know they have a wallet. Another unique component is how users can use the same social login wallet across multiple dApps, erasing the need to juggle multiple logins and/or wallets. There are also plans for a fiat onramp to make it easy to convert traditional currencies into digital assets with NuFi. In addition to maintaining user control and privacy, NuFi’s approach seeks to speed up the mainstream adoption of blockchain technology.

I was lucky enough to get to do an interview with Ben Goldie from NuFi. I asked him about the challenges that traditional users may encounter when entering the world of Cardano. He responded with the following:

BEN – “If you’re a Web2 or non-crypto user, there’s nothing straightforward about onboarding into Cardano. Imagine trying to play a Web3 game: you’d first need to deduce which Cardano wallets are compatible with the game, download one from the Chrome Webstore, set up your new wallet and carefully write down its seed phrase before navigating back to the game and connecting your wallet… Any of these steps can be a drop-off point, especially if you’re overwhelmed by crypto terminology, and we think this creates a huge barrier to entry. There’s also risk involved in self-managing a seed phrase unless you understand its importance, which a Web2/non-crypto user might not… We have a proposal for a fully non-custodial toolkit that makes onboarding as easy as it can be: arrive at a Cardano dApp and log in with a social account to connect instantly. Nothing to download or set up, no seed phrase to write down, and no technical know-how required.”

The NuFi team is focused on solving two major problems. Often, users are confined to a single dApp ecosystem because of a lack of interoperability. By acting as a non-custodial relay, NuFi will allow users to access multiple dApps. WalletConnect integration allows NuFi users to log in with their social accounts or email addresses while retrieving and assembling a private key. Additionally, NuFi addresses the issue of custodial wallets, where users have to share their private keys, which defeats the whole purpose of blockchain. NuFi eliminates this risk by providing a non-custodial wallet solution, so our private keys remain private and inaccessible to DApps.

I asked Ben about which characteristic of the NuFi proposal most differentiates it from other solutions out there. He said:

BEN – “Being able to use the same ‘social account’ wallet across multiple dApps is our key differentiator and it’s what makes our toolkit solution more practical than others… With existing solutions, if a dApp directly integrates with a walletless onboarding service (e.g. web3auth), the user’s wallet is usable only with that dApp (for security reasons). This means a Web2 user is forced to create/use a different wallet for each dApp they log in to and the user has multiple wallets with no way to use a single wallet with different dApps. This is inconvenient and impractical… Our proposed solution removes this problem, meaning a user can connect the same social account wallet to any dApp that integrates the toolkit we’re hoping to build. We estimate that it would take only one day for a dev team to integrate this toolkit into a dApp (and much less than a day’s work if the dApp already supports WalletConnect)… Bonus: there’s also a fiat onramp (so a user can purchase ADA with a card) and an NFT gallery built into our solution that other solutions don’t have as standard.”

WalletConnect is a protocol that connects dApps to mobile wallets securely, which is leveraged in NuFi’s plan. Other important facets of the proposal are Web3auth, which allows walletless and Web2 logins, and the Torus Network, which keeps people’s private keys secure on decentralized nodes. The Torus Network is operated by a diverse group of validator nodes, further enhancing security.

I asked Ben to explain in detail how the solution addresses security concerns related to private key storage and access, including the measures taken to securely handle private keys and the specific role played by the Torus Network in enhancing security. He said the following:

BEN – “Private key security is the be all and end all, and for this our proposal uses technology provided by web3auth and Torus Network… The user’s private key is stored securely in multiple parts (shards) on nodes of a decentralized network called Torus Network. When the user navigates to the dApp and logs in with a social account (e.g. Google, Facebook, Twitter), web3auth authenticates and fetches the private key shards from the decentralized network nodes to the user’s device… The separate shards are then reassembled into a complete private key on the user’s device; this happens only on the user’s device and the complete private key never leaves the device. The private key is then injected into a non-custodial NuFi wallet, which we then connect to the dApp (by sharing the public key – the private key is never shared with the dApp)… For additional security, web3auth allows a user to activate 2FA (which can make a social account wallet even more secure than a standard mnemonic wallet)… Furthermore, our toolkit provides each Web2 user with functionality to create a seed phrase backup for their social account wallet. With this, a user can write down a seed phrase that can restore their wallet at any time to any non-custodial Cardano wallet. This helps mitigate the risk of losing access to a social account or email address, and also gives users a way to transition to other Cardano wallets in the future.”

But what if I get locked out of my social media accounts? Do I lose my dApp assets? Not with NuFi’s wallet recovery solution. As Ben mentioned above, NuFi’s innovative functionality lets you extract your wallet’s seed phrase, a lifesaver in case you lose social media account access. Users can then choose to download an encrypted backup file or transcribe the seed phrase for offline storage. This approach allows users to restore their wallets independently and gain complete control of their Cardano wallet. Navigating the ocean of dApps will become infinitely easier for newbies with a tool like this! 

Using familiar Web2 accounts, users may soon be able to access Cardano dApps without the need to install wallets, manage seed phrases, or have any technical knowledge. For Cardano dApps building right now, this means more efficient onboarding, uniformity of wallets, and more! The Cardano ecosystem stands to benefit from a growing user base, improved liquidity, and improved accessibility.

To measure their impact, the NuFi team set a target of creating 50,000 new wallets through their solution in the first year, a milestone that would signify a seamless transition for Web2 users to Cardano dApps. NuFi’s social media channels will be used to share updates on the progress. During the same timeframe, ten dApps will be the target number integrations. They’ll also get feedback from users and dApps, so they can make improvements, with seamless onboarding and user satisfaction in mind. Keep an eye out for quarterly updates on NuFi’s project.

I asked Ben about the customer service that NuFi plans to provide to Web2 users. He had this to say: 

BEN – “Most Web2 account providers (e.g. Google) have effective account recovery mechanisms but we know that this isn’t a failsafe, so to mitigate risk of losing access to the social account, our toolkit includes seed phrase backup functionality. With this, the user can store a seed phrase offline for the social account wallet, and use the seed phrase to recover that wallet in any non-custodial Cardano wallet. This way, even if access to a social account is lost, the funds in the wallet are always recoverable… Any user who creates a social account wallet and needs assistance will be able to read how-to guides in our knowledge base and has access to our support team at all times (users can submit a ticket for 1-to-1 help and ask our Discord community too).”

The project’s mission revolves around creating a Cardano-first Web3 wallet and a relay solution that extends its support to multiple blockchain networks. To ensure transparency and accountability, the team plans to share ongoing progress and completed milestones through various channels, including social media, newsletters, podcasts, and town hall meetings. This approach would encourage community engagement and also demonstrate a commitment to transparency.

One of the key strengths of the NuFi Wallet team lies in its proven technical capability. They have already created the NuFi wallet, which supports multiple chains, and integrated it with web3auth’s protocol, a significant accomplishment within the Cardano ecosystem. Moreover, the team’s successful delivery of a Project Catalyst Fund9 proposal, adding support for Ethereum and Milkomeda C1 to the NuFi wallet, underscores their capacity to navigate and contribute to the evolving landscape of Project Catalyst. 

I raised a question to Ben pertaining to the complexity of the proposed solution. I mentioned how its successful execution will rely on balancing several systems, then asked if the various moving parts ever make the team feel overwhelmed? He responded with following:

BEN – “No, we’re already very familiar with the technology we use in the proposal. We integrated social account login functionality (which uses web3auth and Torus Network) in NuFi wallet earlier this year and, in doing so, developed a deep understanding of all components (and developed Cardano compatibility for them). WalletConnect is also used in the proposal and this is something we added to NuFi’s web wallet in Q3.”

NuFi’s proposal has five key milestones, each contributing to the realization of a user-friendly, walletless, and streamlined onboarding experience. The first milestone involves the creation of the custom dApp connector window, integrating walletless/Web2 onboarding tools and providing users with access to wallet functionality and fiat on-ramps. Subsequent milestones include the development of a plug-n-play ‘Log In’ library for dApps, integration into a popular Cardano dApp, the launch of a promotional campaign, and feedback collection and implementation of improvements.

By delivering a plug-and-play SDK, NuFi will make it easy for dApps across the ecosystem to integrate. Strategic promotional marketing targeting Web2 users will feature engaging content like promo videos, a Twitter campaign, and Medium blog posts; all backed by professionally designed media, to encourage mass adoption. This ambitious proposal could redefine how many Web2 users think about Cardano. 

I asked Ben to discuss the scalability of the solution to accommodate a growing number of users and dApps, he said the following:

BEN – “The solution can scale as much and as quickly as it needs to (there’s no technological limitation to consider), and we believe that the more things scale through integrations in more dApps, the better the experience will be for Web2 users (who can access more dApps) and the more interest we’ll create for all dApps overall – there’s lots of room for cross-promotion. Increasing cost (of using web3auth) may be a factor as more users onboard, but we need to wait and see how many costs are offset (e.g. from commission for using fiat onramp, cross-chain exchange). After we know this, we will know if we can keep it free forever or if we need to introduce (for example) a tiered subscription plan for usage over a free amount.”

NuFi’s core concept revolves around the aspirational goal of stimulating a surge in adoption of Cardano dApps among traditional Web2 users. The only way to drive adoption is to maintain a commitment to inclusivity of all dApps. NuFi’s plug-and-play interface will encourage new projects to join. Aside from saving dApp developers time and resources, NuFi will cover monthly costs typically associated with onboarding providers, as well as simplifying WalletConnect integration. This is a prime example of a win-win deal!

There are many great Project Catalyst Fund10 proposals out there, unfortunately I will never have the time to read them all. I’m grateful to have had the opportunity to interview Ben Goldie for this article and learn more about this exciting proposal. I hope everyone takes the chance to check out as many proposals as possible and vote for the ones you support! 

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