Thresh0ld Co-Founder and CTO Hakim Mamoni was an early mover into the cryptocurrency space, having first learned about bitcoin and the blockchain in 2012. Mamoni, who has been coding since he was 15 years old, didn’t jump in initially, as he didn’t have the time. Nonetheless, he said it sounded “weird and wonderful” in 2011 and by 2012 he looked more closely into it, realizing that there was an “amazing paradigm in technology that was being introduced to the world.” He said,

“With a background in both the tech and financial world, it hit me as something quite spectacular.”

By 2013, he started working in the industry in China but later returned to the UK to launch a bitcoin startup incubator with a friend. They eventually took that company to the stock market in the UK.

Today Thresh0ld is helping companies with the big problem that many have faced since the early days of Bitcoin and that is private key management. Mamoni pointed to the many companies that have had assets stolen as a result of hackers managing to take over their private keys. He says,

“That’s what today Thresh0ld is about, helping to solve this issue.”

Mamoni explains that the issue that companies have seen over the past decade involves the wallet needing to have a private key that is on the server and connected to the internet. He says hackers have found many different ways to get their hands on those private keys, which has led to the theft of assets.

Additionally, the loss of private keys can cause large damages to exchanges and their customers. For example, Canadian cryptocurrency exchange Quadriga was crippled because one person had access to a private key that was needed to unlock the transactions, the CEO, and unfortunately he died, taking access to the funds with him to the grave.

Mamoni explains that the issue of private keys surrounds where and how you can manage your wallets without running the risk of someone stealing the private key because of an online wallet, or if it’s an emergency wallet that’s not necessarily online, losing access to your private key and your funds.

Thresh0ld  is dealing with this problem head-on using threshold cryptography, from which the name of his company derives. This system dates back to the 1980s by mathematicians who back then were facing the issue of private key management. Mamoni said,

(5:48) “This is not something that is unique and new to the blockchain ecosystem. It’s an issue that anyone who has to deal with private keys, with cryptographic keys, whether those keys are used to sign data or encrypt data or decrypt data, the problem is the same.”

This is especially true for businesses, which must grapple with making sure the cryptographic keys for their business do not suffer being destroyed or taken over. Mathematicians created a new way of doing cryptography where instead of relying on one party who will be in charge of holding onto that private key and managing that key, they flipped the script and started to instead work on multiple-party where none of them needs to have the private key nor any portion of the private key.

Instead, he explains, multi-party computation and threshold cryptography relies on a mechanism where the parties that are involved in the computation generate some cryptographic material that is not the private key or a portion of it. It’s a cryptographic material that is sufficient so that in combination with the others and without the need to share the cryptographic material, they are capable of signing data,  encrypting data or decrypting data.

The mathematicians came up with a theory that stayed a theory until 2008 when a team in Denmark cracked the implementation and turned the theory into applied mathematics. In 2018, that same team, Mamoni explains, brought this to the world of blockchain technology, and that is what the Thresh0ld platform is built on.

Thresh0ld platform is a B2B platform for multiple parties including the customers, the company and cybersecurity partners.

8:04 “We are in the position now to offer to businesses a keyless wallet infrastructure where there are no private keys to be found anywhere,” said  Mamoni.

He goes on to explain that this changes the paradigm of security because now you are in a position where you can have wallets online that are in a position to send transactions when need be without delay and without that same risk of potentially someone snooping around and getting their hands on the very precious private key that controls the funds.

While Thresh0ld is focused on the B2B space, there are other companies that are dedicated to the consumer, such as ZenGo Wallet. They also leverage the threshold cryptography and multi-party computation so consumers can benefit from the technology. For example, you can have a wallet on your mobile phone, but losing your mobile device doesn’t mean losing your private keys because your wallet is a party in the computation so there are no private keys on the mobile phone.