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Crypto Future Wealth Show – Episode 00 – Bill Barhydt – Abra Exchange
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What’s up everyone from around the world this is Jeff Lambert your cryptocurrency expert with crypto future wealth as you know this is my passion.

I love sharing cryptocurrency information with you.  I love meeting new founders and checking out new projects and interviewing them and just seeing what new stuff is coming out in this amazing industry that we have here.

Recently last week I had the opportunity to go to the World Blockchain Forum in London which was an amazing event put on by Keynote.

Keynote has been hosting the events worldwide in Dubai in Miami and also elsewhere absolutely amazing line-up of speakers. One of those speakers was Bill Barhydt, the CEO, and founder of Abra Exchange.

Abra Exchange is a mobile-based exchange that currently supports more cryptocurrencies than any other exchange out there that is mobile based.  It is also non-custodial, which means you would have to have your phone hacked for you to lose your cryptocurrency.

They do not hold anything, and that also includes the Fiat deposits that you make which you can now do in the EU in the US it’s an amazing app.


I had the opportunity to sit down with Bill bar Heights and ask him a little bit more about the hybrid exchange and what they’re doing the features involved and also about their new announcement that came up so without further ado I want to jump right into the interview.

I’ve got a lot more interviews lined up for you guys, and I hope you enjoy this one once again this is Bill Barhydt with Abra Exchange enjoy.


Interview Transcript

Jeff Lambert:

Welcome to the show this is the Crypto Future Wealth show. I’m Jeff Lambert, and we’re here with Bill Barhydt.  He is the founder of Abra Exchange which is a mobile wallet that’s supporting, in fact, many currencies than any other wallet that is currently out there so why don’t you tell us about your product and what differentiates it from what’s out there already in the market.

Bill Barhydt:

Absolutely.  Thanks for having me on.  Abra is a smartphone-based currency wallet and exchange service.  It is a 100% smartphone-based for iPhone and Android.  The app itself is what we call non-custodial which means you’re holding your private keys to your cryptocurrency assets.

It uses a proprietary Bitcoin-based stable coin technology to hold fiat currencies.  So the 50 fiat currencies we support as well as the cryptocurrencies we support are 100% non-custodial.  Abra is not even holding the cash.  So it’s the only app in existence that can hold 78 different assets.

 

Fiat and cryptocurrencies exchanges between all 78 of them in real time.  You can provide cash in and out via a US bank account and as of today via European bank accounts. That’s an announcement we made today, but Abra is never touching the funds.

Abra has users in dozens of countries right.  It’s just that like say in South American countries you can only use Abra by depositing crypto into the app.  Litecoin, Bitcoin, Bitcoin Cash.  Native Bitcoin Cash support for deposits and withdrawals is also something that we’re announcing today for the first time.

Jeff Lambert:

It’s perfect yeah and you had mentioned that it’s non-custodial so how does that work with your private keys are you able to back up the wallet itself.

Bill Barhydt:

You are, and import it into the app.  The first time you receive money into the app like via a bank deposit or a crypto deposit you get a big flashing pop-up message.

Now is the time to backup your wallets by using the normal 31 passphrase model.  It then gives you two other warnings and the third time it doesn’t let you use the app again until you’ve actually proven that you’ve done it by typing in the phrase.

We have 99% compliance with this, actually over 99%, because we forced uses to do it and we feel ethically bound to do that.  If you lose your phone with $100,000 with the crypto on it the crypto is gone forever.

But if you have the backup you’re good to go, so we forced users do that backup and it is by far the best way that we’ve found to have a compromise between ease-of-use and personal security which means never leave your keys online.

As an exchange, we hate that idea we think that’s a horrible idea that’s why the app is non-custodial right and making our app completely unhackable.

There has never been a hack at Abra and even if Abra itself was hacked, you can’t hack consumer funds because we don’t have them.  If we have a million users you would have to hack a million phones in order to steal crypto funds from the app around.

Jeff Lambert:

It sounds like a great feature.  That’s one of the things I’m always discussing with my students, and my audience here is never to store your crypto on an exchange overnight.  Get in, do your trades, get out.

Bill Barhydt:

I say this all the time, and my background is in PKI cryptography as well as consumer internet and payment, so it’s the confluence of all three worlds and one of my kind of big sayings and my team you know mean to say this all the time.  Don’t leave crypto online.  It’s like an open invitation for basically hackers to come in and steal it.  It’s a really bad idea.  That was the whole idea of Abra so that you could become your bank to take your cryptocurrency and store it on your own phone.

Jeff Lambert:

Perfect, and how does it work compared to other exchanges?  Are you commission-based? fee-based? What are the charges for the customer on there?

Bill Barhydt:

There are zero transaction fees.  We make a spread on the conversion between exchanges, so if you use Abra to send Bitcoin to another friend or send Fiat from my phone to your phone, we don’t charge transaction fees on Abra.  It is great for that.  You can do cross-border transfers from dollars to dollars or do an exchange of currency either on your phone or between our users we make money on the exchange between currencies.

Okay, and that’s dependent upon how liquid the currency is you can do it fiat to fiat if you have crypto to crypto, or crypto to fiat any direction you want and you can also use it for global money transfer as well as just investing.

Jeff Lambert:

You had mentioned that it’s a stable coin model for US dollar or euro deposits or pound deposit or whatever fiat you’re using what stable coin are using is it your own?

Bill Barhydt:

It’s our own.  It’s a unique model, and this was the basis for building Abra.  All of the assets in the system except for the three that I mentioned, Bitcoin, Litecoin, and Bitcoin Cash are all stored using Bitcoin-based multi-sig contracts.

Now for the non-technical people in your audience let me explain what that means.  If you buy gold in the US for example, I don’t know how it works here but, in the US, you buy gold usually be an ETF an exchange-traded fund.  That gives you dollar-based exposure to the value of gold.

What Abra is doing is we’re giving you Bitcoin-based exposure to the value of any asset, Fiat, or other cryptocurrencies, so if you’re holding dollars let’s say you put 50 dollars into the Abra app what actually happens is at that moment we give you 50 dollars’ worth of it onto your phone but that’s not in a normal single private key it’s in a multi-sig contract.

If the value of Bitcoin goes up, you’re no longer holding $50; you’re holding more than $50 because some of that Bitcoin belongs to Abra.  The multi-sig contract takes that Bitcoin back from the user if the value of Bitcoin goes down.  You’re not holding $50 anymore, and you’re holding too little Bitcoin, so the multi-sig contract causes the Abra app to get more Bitcoin to bring your dollar balance back up to $50.  This also hedges away our counterparty risk on those contracts using very sophisticated hedging techniques in the background.

We’ve never lost a penny even when the price of Bitcoin was plummeting earlier this year.  This works with fiat currencies and with other cryptocurrencies.  Today we launched support for Tron and Cardano.

Those are stored using synthetic currencies as well because you can’t deposit and withdraw those currencies you can only invest in them.  The way you invest in them is using the same multi-sig contract I just described.  The way we determine which currencies are in the app is they have to be liquid enough for our hedging system to hedge our counterparty risk on those contracts.

The good news is the consumer doesn’t have to understand any of that, all they have to know is that just like a gold ETF, I can put in dollars put it in gold and if the price of gold goes up I have more dollars the same thing with your dollars in Tron and Tron goes up and you sell the Tron you have more dollars or more pounds or more euros that’s all you have to know.

In the background it’s extremely complex what’s going on, but that complexity is a huge advantage for Abra because we can add more cryptocurrencies on-the-fly, we can add more fiat currencies on-the-fly, and in the future we can actually add more asset classes like stocks, equities, commodities, actually relatively easy and you’ll be seeing other announcements about that later.  The Abra model was designed to use cryptocurrency smart contracts as the basis for a new type of investing.

Jeff Lambert:

Yeah, it sounds brilliant you’ve made it very easy for the everyday person to get involved in crypto.

Bill Barhydt:

That’s exactly right, that’s the whole point of Abra.  To allow the everyday user easy access to the crypto world without having to understand all the mumbo-jumbo but taking advantage of crypto the way it was meant to be used you’re holding your key right we’re using multi-sig contracts but hiding the complexity to the user.

Another analogy that I like to use is it would be like saying I don’t have to know what a TCP/IP socket is to watch a Netflix movie.  Computer scientists would say but TCP is cool, but I would say yeah but your mother shouldn’t have to know what TCP/IP is to watch a Netflix movie.  That’s the beauty of those services.  Abra is doing the same for crypto-based investing.

Jeff Lambert:

That’s great that you’ve thought about that ahead of time.  It is one of the things that I’m trying to teach other projects as well.  There is a lot of confusion in the market behind technology and how it works. I think the way forward for mass adoption and crypto is to put the technology aside much as you mentioned with TCP/IP.  You don’t need to know how Netflix works you want to know that when I click this button, a show will start playing.

Bill Barhydt:

That’s right, and at Abra, it took years up front to build the right platform to enable these investment contracts.  We took advantage of the fact that Bitcoin or Litecoin itself is programmable money.

Jeff Lambert:

So what’s the future?

Bill Barhydt:

Well, I hinted at it a little bit you can see more at new asset classes coming in the future probably next year, but that’s way out. We want to add more cryptocurrencies and means of liquidity so that people can get money in and out of the app and use the app in different countries.

Today we announce,d that we now support over 30 countries in Europe with SEPA transfers.  We also support the United States, Asia and we want to add dozens more over the coming years.

We want to be the number one cryptocurrency investing platform in the world, and we think that the smartphone is the right way to do that and then eventually segway into being a real crypto-based bank.

This would eventually include credit products so you can earn interest on your crypto, other asset classes, all in the same app but using a smartphone and taking advantage of these cryptocurrency bases smart contracts.

Jeff Lambert:

Sounds amazing how do people get started? What’s your website?

Bill Barhydt:

Abra.com or you can search for Abra on the iPhone App Store or Google Play Store and download the app.  You can be up and running in seconds, and you can do a transfer as of today directly into the app.  The app will give you instructions on where to send your money to.  You can start out with a couple of hundred pounds or euros, etc…

Most of our users say it’s incredible how fast they’re up and running.

Jeff Lambert:

Thank you very much.

Bill Barhydt:

Thanks for having me.


I’m going to be posting more interviews that I have from the World Blockchain Forum in London which was an event by Keynote also a big thank you to Amanda for inviting me to come out to the event that was absolutely amazing top line of speakers.

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