Investing in Entropy
Lisa Cuesta and I are proud to announce our investment in Entropy’s pre-seed round to build the first ever truly trustless Decentralized Asset Custodian protocol. The round was led by Dragonfly Capital and accompanied by The LAO and P2P Capital, alongside prominent angels such as MacLane Wilkinson, Jutta Steiner, Naval Ravikant, Robert Miller, Lucas Vogelsang, Henry de Valence, and Dean Eigenmann.
Working in infrastructure today is repeatedly coming face to face with the same set of tradeoffs — security vs usability. Nowhere is this more apparent than custody. Initially custody was simple — keep private keys secure and make assets available on demand. Over time it became more feature rich as users demanded to stake, vote, and participate in DeFi. However in all cases, users are limited by the blockchains their custodian supports and what services or transaction types they enable on those blockchains. This is simply not scalable because the rate of new blockchain launches and DeFi dapps is already too fast for custodians to keep up and will only get faster over time, not to mention the new use cases and token standards like NFTs, revenue streams, identity, and so on.
Entropy’s mission is to create a decentralized network leveraging advanced threshold cryptography and multi-party computation (MPC) to enable users to securely store and use their crypto on any blockchain. Put another way, Entropy allows you to implement secure business logic for how an address on any blockchain can interact with any of the assets it owns. I cannot stress enough how much this will unblock innovation because it will allow anyone to create their own custom custody solution for their needs. But also, it will be possible for custodians to add support for Entropy as well and serve as a backstop for their customers, greatly expanding their suite of capabilities.
However, the last bit that’s most important is that Entropy does not introduce any new protocol-level trust assumptions. If a user has an Ethereum address, there’s no bridge between Entropy and Ethereum, and there’s no need for a user to trust the Entropy validator set. Even if the entire Entropy network validator set is compromised or becomes malicious, they cannot steal user assets. Ultimately, the user is always in control.
It has been my pleasure to know Tux for several years while they were at NuCypher and I am elated to support them and the entire Entropy team on this new venture. The team is sprinting towards finishing their MVP now, at which point they’ll release technical details on how Entropy works. Until then, please follow along with their progress on Twitter, enroll in their Discord, and join their team by emailing hello@entropy.xyz with the role you envision for yourself.
