Circle, the issuer of USDC, introduces beta version of MPC wallet for Ethereum, Polygon, and Avalanche.

Circle, the issuer of USD Coin (USDC), has unveiled a beta version of a multiparty computation (MPC) wallet service, as announced on August 8. This new offering will enable developers of decentralized finance (DeFi) applications, Web3 gaming, e-commerce platforms, and various blockchain solutions to design tailored wallets for their users. Initially, it will be accessible on Ethereum, Avalanche, and Polygon.

Creating crypto applications remains overly complex. Furthermore, fewer than 0.5% of the 100 million developers globally are currently engaged in building crypto applications.
This situation requires improvement. Our new wallet-as-a-service developer platform represents a significant advancement in this area. Explore it at https://t.co/ku9LTz8Z97

— Patrick Hansen (@paddi_hansen) August 8, 2023

MPC wallets enhance security by dividing a user’s private key into several shards and distributing them across a decentralized network. This innovative wallet technology has been adopted by numerous Web3 developers. MPC wallets can be accessed through an application programming interface, providing a “Web2 feel” that is preferred by some developers and users.

As detailed in a blog post from Circle, the new service will enable developers to “select the optimal wallet security and control configurations.” For instance, some developers might opt to manage their own MPC nodes to avoid complete dependence on Circle, while others may prefer the more straightforward approach of connecting to Circle’s nodes. Developers also have the option to “share transaction signing duties with users,” which allows them to recover keys if users misplace them, or they can create a noncustodial product that requires users to sign each transaction.

Circle co-founder and CEO Jeremy Allaire emphasized the importance of the new service in fostering the adoption of USDC:

“Circle’s Programmable Wallets form a new, fundamental aspect of our strategy to enhance global, mainstream utility and acceptance of digital assets like USDC and public blockchain-based payments. This new platform represents the initial phase for Circle’s Web3 services as we aim to alleviate common challenges faced by developers.”

MPC wallets have encountered scrutiny, particularly after the widely utilized Multichain MPC bridge was compromised on July 7, resulting in losses exceeding $100 million for investors. The Multichain team later acknowledged that all MPC shards had been stored on a cloud server controlled by the CEO.

In a statement to Cointelegraph, Circle’s senior director of product management, Gagan Mac, asserted that the new service “is developed and maintained internally and does not rely on external vendors,” suggesting that third-party cloud storage solutions will not be utilized. Additionally, Gagan mentioned that “some developers and enterprises may choose to host an MPC node,” which they will be permitted to do if they desire. Multichain did not provide partners with the option to host their own nodes.

Circle recently indicated that interest in euro-based stablecoins is increasing and also contended that a yuan stablecoin would be preferable to a Chinese central bank digital currency.