Company Name: Foundation equipment
Founders: Zach Herbert, Ken Carpenter and Jacob Johnston
Date of establishment: March 2020
Location of the head office: Boston, MA and remote (worldwide)
Amount of Bitcoin in Treasury: Foundation holds bitcoin, but does not disclose amount
Number of employees: 24 full-time employees
Website: https://foundation.xyz/
Public or private? Private
Zach Herbert wants everyone to be able to store their own bitcoins.
This is why the co-founder and CEO of Foundation equipmenta company that makes hardware and software wallets for Bitcoin, has spent the past four years developing Bitcoin technology that is not only secure and open source, but also as usable as products from Apple, a brand Herbet loves (or at least used to love — read on).
What sets Foundation’s flagship hardware wallet, called the Passportfrom the competition is a “combination of design and user experience,” Herbert told Bitcoin Magazine.
He went on to say that the Foundation also has “very strong principles that we try to uphold around open source, privacy and freedom.”
Foundation’s strength lies in the way it stays true to its principles while developing products that are relatively easy for people new to the world of Bitcoin to use.
“I think you have to define those principles from day one and really know why you’re doing what you’re doing,” Herbert said of how he and his team achieve such a balance.
“I don’t think it conflicts with the idea of wanting to build the best possible devices or products,” he added.
Products of the foundation
Foundation is best known for its hardware wallet, the aforementioned Passport.
The device looks like a more luxurious version of a feature phone, but with a higher resolution screen.
One of the great things about Passport is that it is air-gapped. This means that it never needs to be connected to an internet-connected device. This provides additional protection for the user’s private keys.
As for the private keys, Foundation has created a simplified way to back them up compared to the traditional method of writing them down. With the Passport, users can store their seed phrase on the industrial-grade microSD card that comes with the device.
“We think that not having to write down those 12 or 24 words will help you get on board faster,” Herbert said.
Signing transactions with the Passport is also significantly less complicated than with most competing devices. You can do this by simply scanning a QR code with your Passport and mobile phone.
The Passport works best in combination with the Foundation Envoy mobile app, which also functions as a standalone hot wallet.
To make user onboarding even easier, Herbert and the Foundation team developed a system that allows users to use the app securely and almost instantly.
“We created something we call Magic Backups, where we actually store the seed in your iCloud Keychain or Android equivalent, which is only for the hot wallet on your phone,” Herbert explains.
“The great thing about Magic Backups is that you can be up and running within 60 seconds of first downloading the app, so you can always import your own seed if you want, or create and save your own seed instead,” he added.
“We try to gloss over things that may be complicated, but we do things based on industry standards.”
He admitted that this is definitely not as secure as storing your seed phrase on a microSD card or writing it down, as storing your seed phrase offline is more secure than storing it online. He also noted that the hot wallet is only suitable for minimal amounts: the same amounts that you would keep in your physical wallet in cash.
Another feature of Envoy is that you can buy bitcoins through KYC– free P2P marketplaces like Hodl Hodl and Bisq in the app and then send the purchases directly to hot or cold storage.
🎬 Start your Bitcoin journey right!
Avoid KYC hassles and take control with P2P Bitcoin platforms.
Within Envoy, you’ll discover the best P2P platforms to help you realize a truly sovereign future.
We build to support you every step of your journey 🧡 photo.twitter.com/hbCeAOCWZl
— FOUNDATION (@FOUNDATIONdvcs) July 8, 2024
One of the Foundation’s goals in creating Passport and Envoy was to satisfy all levels of bitcoin owners.
“We try to make products that the seasoned user will use and love, but that they will also feel comfortable recommending to their friends and family,” Herbert explains.
Why wallets?
Herbert entered the Bitcoin market in 2013, in the early days of hardware wallets.
“When I first came into contact with Bitcoin, hardware wallets were just emerging,” Herbert says.
He used to use a software wallet called Armory, which Challenging to use to say the least.
“The recommendation was to install Armory on an air-gapped computer where ideally you would remove the Wi-Fi card and use it purely to run Armory,” Herbert said. In essence, the computer in this case became the hardware wallet.
Herbert explained that there were no seed phrases at the time and you had to print the private key on several pieces of paper, creating a sort of physical version of a Shamir Backup system.
While Herbert is well aware that wallets have become significantly more user-friendly than they were in 2013, he still finds most hardware wallets unnecessarily difficult to operate. He said that some hardware wallet manufacturers even seem to pride themselves on making products that are difficult to use, and argued that learning to use these wallets is akin to a “rite of passage.”
With Foundation, Herbert wanted to create technology that is ‘more accessible and more thoughtful’.
A love-hate relationship with Apple
Herbert’s vision for Foundation includes building more products that sync with each other in the same way that Passport and Envoy do.
“We want to be like the Apple of the industry,” Herbert said. “(We want to) build hardware, software and services that are all tightly intertwined and work together seamlessly.”
Herbert shared that Foundation plans to launch “potentially a new product category” by the end of the year.
Could it be the Bitcoin-focused phone he’s been asking his followers on X about?
What features would you want in a smartphone that runs on Bitcoin? https://t.co/8dIon71apI
— Zach Herbert (@zachherbert) May 18, 2024
Don’t hold your breath.
There are a few things that stand in the way of bringing such a device to market. Ironically, Apple is one of them.
“A phone is definitely an option,” Herbert said of projects he’d like to work on, “but I think it’s more of a project for later in the decade, because I think we need to be further along as a company, and I think the industry needs to be further along as well.”
The other problem is that Apple has hampered the adoption of decentralized technology, said Herbet, who wrote a series of blog posts about the issue called “Not in love with Apple anymore” for 2020.
“(Apple’s) app restrictions are very bad for the (Bitcoin) space,” Herbert said.
“I think a very simple and easy example is NFC payments on iPhone. There’s a reason Bitcoin wallets can’t do Tap to Pay with NFC, and that’s because Apple doesn’t allow it. You can only use NFC for Apple Pay,” he added.
Herbert also pointed out that Apple is even hampering the design of mobile Bitcoin wallets, which not only affects the quality of mobile Bitcoin wallets for Apple users, but also those for Android users.
“More than half of your users are going to be iOS users, and you don’t want to deliver a completely separate Android experience,” Herbert explains. “No matter what Apple does, even if Android enables more, you ultimately decide to just go along with the limitations that Apple imposes.”
If Foundation wants to continue its mission to become the Apple of the Bitcoin industry, it will have to get rid of Apple.
What’s next for Foundation?
Besides the idea of creating a mobile phone in the distant future, Foundation is also involved in the implementation and development of other technologies.
Herbert said the Foundation is considering Taproot multisig within the next few months.
“When we get to the point where we actually have users actively using it, we will add support,” said Herbert, who also pointed out that the Passport already offers an excellent multisig experience.
On another front, the Foundation will retain its Samourai Whirlpool Postmix Extension live on Passport, allowing Passport users to connect to Sparrow Wallet to move their bitcoins directly into cold storage with the click of a button.
We are not removing the Whirlpool Postmix extension on Passport🌀
We eagerly await the return of Whirlpool and Samourai once their names are cleared and charges are dropped.#FreeSamurai photo.twitter.com/SltJpDThFv
— FOUNDATION (@FOUNDATIONdvcs) May 9, 2024
Although Sparrow has suspended this service in the wake of the arrest of Samourai Wallet developersHerbert and the Foundation team are confident that the wallet will restore service once the Samourai developers are exonerated.
“We believe the Samourai team broke no laws,” Herbert said. “We donated half a bitcoin to their legal defense.”
Herbert also noted that Foundation was on the verge of adding the Whirlpool feature to the Envoy mobile app before news of the Samourai developers’ arrest broke.
And finally, the Foundation plans to Lightning to Envoy to make sending and receiving bitcoins as fast and cheap as possible.
“Having Lightning in Envoy allows us to provide the best possible user experience,” Herbert said.
“We can obscure a lot of the complicated stuff that happens behind the scenes and have a simple transfer flow from Lightning to cold storage or from your hot wallet to cold storage. You can just tap the transfer button in the app, just like you would do a transfer from your checking account to your savings account in an online banking interface,” he added.
It’s clear that Herbert and the Foundation team are not short on ideas or vision.
Considering how much they’ve delivered since the company’s founding just four years ago, it’s not hard to imagine that future versions of their hardware and software (and any new products they create) will only become more user-friendly and dynamic.
“We’ve barely scratched the surface of what Bitcoin wallets can actually do,” Herbert concluded. “There’s going to be so much rapid progress in the coming years.”