A Conversation with UniPass: Your Free Web3 Account by Nervos Network May, 2022

The following article was first written and published in Chinese by Jack Xiong, researcher and editor at BlockBeatsChina, and translated into English by a Nervos advocate.

Following the popularity of STEPN, a slew of X2Earn projects sprung up. From the perspective of BlockBeats, STEPN is the first sign of the rise of Web3 applications. We’ve observed the continued popularization of blockchain with technological advancements during the past years:

In 2016 and 2017, with the rise of Ethereum, the blockchain sector shed the narrative of “finding the next Bitcoin,” and ICOs laid the foundation for the “cripto industry”.In 2019 and 2020, DeFi Summer became a blockbuster hit. blockchain technology broke through at the protocol level, such as DeFi, NFTs, Layer 1, Layer 2, etc., and found the “application scenario.” The concept of “Web3” began to gain traction.In 2022, STEPN’s popularity has gone beyond the blockchain sector. blockchain technology is advancing by leaps and bounds at the application level, similar to apps like Facebook and Uber during the Internet’s boom.

Jack Xiong, researcher and editor at BlockBeatsChina, interviewed the UniPass team for this piece to cover everything from project introduction and positioning to the product status, from task priority to financing. In the future, BlockBeats will continue to focus on the progress of Web3 projects, keeping in regular contact with application builders, and closely monitoring this new wave of Web3 development.

UniPass is a protocol layer application that allows Web3 users to create a decentralized digital identity (DID). Its role is similar to that of email on the Internet, and it aims to make Web3 more accessible to traditional Internet users by lowering the barriers to entry and accelerating the mass adoption of Web3.

Built on Nervos CKB, UniPass helps users to create their DIDs, manage non-custodial private keys and recover accounts, and it serves as the bridging infrastructure between Web2 and Web3. UniPass is a useful tool for regular users to manage their on-chain identity, while it is the golden key for developers to expand their user base by removing restrictions and making dApps more accessible.

To summarize, UniPass has three major highlights:

In Web3, the concept of “digital identity” is becoming more and more important, because a wallet address not only lacks vitality but it is also difficult to measure the behaviour and reputation of the user behind it. UniPass will integrate various reputation systems, such as avatars, points, badges, labels, etc., and provide encrypted verification for wallet addresses, emails, social accounts, and even e-passports and driver’s licenses, breathing life into the wallet address. Thus, UniPass will bring many benefits to both users and application builders. For users, a positive reputation may lead to greater airdrop possibilities or the right to use certain dApps. For dApp builders, UniPass will help them select targeted users more precisely and implement user verification as necessary.

Although managing private keys is a basic operation for existing cripto users, it is a big barrier to the mass adoption of Web3 applications. In retrospect, the Internet saw a rapid increase in the number of users after resolving similar tedious user experience issues. UniPass will provide Web3 users with a smooth “login without a private key” experience, thanks to its non-custodial private key management solution. In the eyes of UniPass, the best private key manager will not be noticed by users, which is why this is one of the team’s aims.

Another major highlight of UniPass is its account recovery. With a unique on-chain email authentication mechanism, UniPass will offer a low barrier email-based social recovery when a user’s digital identity or private key is lost. Users can set multiple emails from different mail services as their guardians, without worrying about a single point of failure. Furthermore, family members and friends can also become guardians, providing protection and verification for users’ accounts with no requirement of blockchain knowledge; they will only have to know how to send an email.

During the talk, Frank Lou, founder of UniPass, mentioned the “gene hypothesis”, which states that a team’s previous work will influence its perception of the entire industry and market, as well as its prospects. The UniPass team has been working in the Internet industry since 2012, mostly in the area of Internet traffic. Whether it is a mobile game distribution or overseas advertising, Internet traffic has always been at the heart of everything, which makes the team understand the meaning of the phrase “Without users, there is nothing.”

Prior to 2015, Frank Lou’s team benefited from the rapid growth of Internet platforms. At that time, the distribution channels of the Internet were very fragmented. Take the Android app store, for example, there were 200 to 300 channels and countless app stores, and different channels had different requirements. Frank Lou’s team took the approach of integration, providing a unified SDK that covered the needs of each channel. When it came to 2015 and 2016, the industry became more oligopolistic, causing the shrinkage of many distribution channels. Small and medium-sized channels started to lose customers due to licensing issues, and one by one went bankrupt.

This made Frank Lou realize that you may catch a wave in a good sector with good timing, but the key is what have you acquired thereafter?

Although Web3 is very popular now, it is still in its early stages, with a modest number of users. The total number of Web3 users is optimistically estimated to be tens of millions at most. Furthermore, this field has high requirements of technical capabilities to use products, thus not everyone can enter. As a result, the most crucial thing at this stage is to seize the most valuable resource — users.

Web3, in contrast to Web2, stresses user autonomy. Applications can not be like traditional Internet applications and take users into their own hands. Instead, they must provide the best service and become the “closest touchpoint” to users, in other words, when the user thinks of a specific scenario and his first reaction is your product, then you have won.

According to the UniPass team, the contemporary cripto industry is remarkably comparable to the very early stages of the Internet — there is no unified low-threshold OS, user experience is too complicated, and end-users are exposed to numerous needless procedural details. As we all know, public and private keys are not inventions of blockchain technology, they have been in use on the Internet for decades, however, we seldom endure time-consuming processes like these on the Internet. This is because applications hide certain operating procedures behind the scenes in order to ease burdens on users.

Web3 should be similar. MetaMask and ENS, in the eyes of the UniPass team, are wallet applications, like U-shield and online banking in the financial sector, which cannot be classified as generalized accounts (or DID). In today’s Web3 field, there is no infrastructure that takes users into consideration when moving in this direction. Thus there is a huge market, whoever succeeds in doing so likely becomes the next MetaMask.

UniPass is designed for broader application scenarios, while cripto wallets today are still focused on financial scenarios.

Strictly speaking, UniPass does not have a direct competitor, according to Frank Lou. UniPass provides a one-stop service — from private key management to DID and social recovery.

However, in terms of accounts, Web3Auth might be considered a strong competitor to UniPass, as both products enable login through email. Email login is a key element to increasing Web3 users.

The main difference between UniPass and Web3Auth is the usage of on-chain operations utilizing emails. UniPass uses cryptographic authentication through emails, and thus email operations can be tracked on the blockchain, while Web3Auth has no on-chain component, its email login has nothing to do with a blockchain. Although Web3Auth adopts multi-node hosting, which is slightly better than centralized hosting, it is still using hosting services, in turn, this is no different from using a phone to receive a verification code.

There are two problems for Web3Auth. The first one is the threshold to log in on new devices, and the second one is security. Firstly, although Web3Auth has lowered the threshold for users, logging in on new devices will be much more complicated. To reduce its centralization, Web3Auth requires users to provide multiple authentication methods such as email, password, and previous devices before they can log in on a new device, making it difficult for users to switch devices. Secondly, as the cryptography of Ethereum is incompatible with that of the Internet, the private key of Web3Auth can only be stored in plaintext in the storage of the front-end of the web browser, which brings hidden dangers to the security of the account and assets.

According to Frank Lou, there are also differences in the values and choices of the two teams. In the current multi-chain world, each application often has to choose between a better architecture and a better ecosystem. In this case, Web3Auth chooses to expand its popularity in a better ecosystem, while UniPass chooses a better architecture and more sustainable growth.

The current business model of Web3 is not clear, each application is experimenting and exploring. UniPass has found a suitable business model after extensive research and investigation.

Fee Model (similar to MetaMask). When an application has a sufficient number of users, payments, and application scenarios, charging a tiny fee can generate a significant amount of revenue.Premium Service. When the number of users exceeds a particular threshold, there will be advanced user needs such as permission management, customized identities, etc. UniPass can charge users an annual fee for these advanced features.B2B model with XaaS. This is a customized service that might be found in different applications. UniPass not only serves individual users but also works in different application scenarios.

There is an old saying — “Software comes and goes, hardware is forever”. Although this old saying no longer seems to apply to today’s IT industry, it nevertheless reflects a universal truth about the importance of mastering the core resources of the industry. We can apply the same logic to Web3: though business models come and go, users are forever. Although the current business model of Web3 is evolving every day, having users is always the correct thing, as Frank Lou has said “With users, you will always be invincible. This is a basic assumption.”

By now, UniPass V2 has more than 20,000 users and UniPass V3, which was recently released, has 5,000 users. Although UniPass is already used by several NFT projects as a whitelist verification tool; however in the team’s eyes, UniPass has not yet shown its real application scenarios, nor has the team started the onboarding work in earnest.

The team has been working on UniPass for nearly a year. Last year, the team released the UniPass beta version, which included updates on private key management, connector, and authenticator. Now UniPass V3 is live.

The UniPass team will mainly focus on two things this year: bootstrapping application scenarios and optimizing product structure.

UniPass is a scenario-driven application, just as MetaMask’s success is dependent on the Ethereum ecosystem. As infrastructure, UniPass is meant to be the first thing a GameFi player thinks of when they want to log into a new game.

In the coming months, the UniPass team will actively look for application scenarios in Web3 and Web2 to attract users, and adopt the strategy of serving B2C and B2B together. Because UniPass aspires to be the bridge between Web2 and Web3, the team will not only focus on Web3 users.

A very interesting thing is that UniPass chooses to pick a somewhat limited Web2 scenario — federated social networks.

The idea of a federated social network is very similar to that of Web3. Application servers and domain names can communicate with one another. For example, users can see the content of Twitter users on Weibo, and can like, follow and privately send messages to Twitter users. In other words, although the social platforms on the federated social network are different, functions such as chat and private messages can be extracted, which is similar to today’s Web3 applications indexing users’ NFTs and then using them in different application scenarios.

From the perspective of UniPass, the federated social network is already Web3 in spirit, but technically it still lives on the traditional Internet level. This has resulted in issues such as account ownership, which is where Web3 applications can provide solutions. UniPass can help users of federated social networks manage the decentralized digital identity that controls their data and assets, through an on-chain social network, data ownership, privacy protection and other functions.

By optimizing federated social networks with Web3, UniPass can show its usage to other Internet apps. If other applications see the potential of UniPass, they can download the UniPass SDK and easily adapt the module to their own applications.

Optimizing the product is significant here. Frank Lou expressed great confidence during the interview. “We are seasoned veterans of making Internet products, so we are confident in our capacity for developing new products.”

The existing technology that UniPass uses on Nervos CKB is called SMT, which is similar to “rollups”. However, the structure of SMT is not suitable for developing more complex logic, so the UniPass team will design its own application chain. With the application chain, customized services can be provided, such as covering the gas fee for whitelisted users. The application chain is live on testnet and is estimated to be integrated into UniPass in Q3.

Designing an application chain is a product structure optimization within UniPass. Although users will not notice any difference in the experience, it will bring the benefit of simpler and faster integration when UniPass works with other projects and application scenarios.

UniPass now has ten employees, most of whom are involved in R&D, and UniPass has completed its seed round financing.

The team intends to adopt a long-term approach. The current objective is to optimize the product and expand application scenarios, so no external promotional activity is planned. As a result, the voice of UniPass is seldom heard, but this is also a sign of a hardworking and qualified team. “Our team always keeps in mind to do things first, then talk,” Frank Lou remarked.

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