Company Name: Cake Wallet
Founders: Vik Sharma
Date Founded: October 2017
Location of Headquarters: Saint Kitts and Nevis (and staff is remote)
Number of Employees: 14
Website: https://cakewallet.com/
Public or Private? Private
When Vik Sharma isn’t serving as the CEO of Liberty Steel, he’s focused on making bitcoin and other cryptocurrencies easier and more private to use via Cake Wallet.
Sharma believes that a product must be user-friendly if it is to be adopted widely, which is why usability is at the center of the Cake Wallet mission.
“The very broad mission of Cake Wallet is to bring cryptocurrency to the masses, to enable people to easily send, receive, hold, swap, on-ramp, and off-ramp crypto like you would with Venmo or PayPal,” Sharma told Bitcoin Magazine.
The other primary dimension of the Cake Wallet mission is privacy.
Sharma is a staunch believer in the idea of transactional privacy, something he came to value after experiencing just how public bitcoin is by default.
Prioritizing Privacy
Sharma first started acquiring and mining Bitcoin in November 2013. (The ASIC miners he purchased from eBay and ran in the basement of his office building back then were minting him a cool 0.2 bitcoin per day at the time.)
By the mid-2010s, Sharma wanted to do more with his bitcoin than just HODL it. He wanted to use it, and, at that time, it was mostly only illicit online marketplaces that accepted bitcoin.
“Back then, it was hard to find anyone that took bitcoin,” began Sharma. “You had Silk Road, and then AlphaBay and other darknet markets, and I thought, ‘Let me check this out.’”
After attempting to make a purchase on one of those darknet sites, Sharma was promptly notified that he’d crossed a legal line.
“I sent Bitcoin directly from my Coinbase account to the darknet address,” said Sharma.
“And, I kid you not, within seconds, I got an email from Coinbase saying ‘Your account has been suspended or deleted or canceled because you’ve violated some terms of service and you need to move your assets ASAP. I was like, ‘What the heck? How did they find out? There must be millions of addresses out there. Are they tracking millions of addresses?’” he added.
“That woke me up to the transparent nature of Bitcoin.”
Not only did Sharma’s experience using bitcoin in a darknet marketplace enlighten him as to just how public a ledger Bitcoin actually is, but it also introduced him to Monero (XMR).
“There was this other special coin on AlphaBay called Monero, and I thought ‘Why not Litecoin or Ethereum or whatever was big at that time — why only Bitcoin and Monero?’” said Sharma.
It was in pursuing an answer to this question that Sharma went deep down the Monero rabbit hole. His research led him to embracing the concept of transacting privately with cryptocurrency.
And so he created Cake Wallet — a Monero-only wallet at its inception.
Cake Wallet And Silent Payments
Cake Wallet launched in January 2018. Approximately one year later, Sharma added Bitcoin functionality to the wallet, as well.
However, for over five years, Cake Wallet users had little ability to transact privately with bitcoin using Cake Wallet. The wallet didn’t have a Lightning implementation (Lightning offers more privacy than the Bitcoin base chain), nor many other privacy-enhancing features (aside from letting users add or select the node they want to use within the wallet).
If a user wanted to make a private payment, they were better suited using XMR.
But transacting with Bitcoin via Cake Wallet became somewhat more private (though still not as private as using Monero) in September 2024, when Cake wallet became the first bitcoin wallet to implement Silent Payments.
Silent Payments enable users to receive bitcoin payments without revealing their public Bitcoin address. They’re like a P.O. Boxes for public Bitcoin addresses — static addresses that allow users to receive bitcoin without having to reveal their actual Bitcoin address — and they’re great for anyone doing fundraising or accepting payments via a public Bitcoin address.
“When I read about Silent Payments, I liked it right away,” said Sharma. “I wish the Bitcoin community was more enthusiastic about it, because I think it's a great feature, especially if you're posting an address publicly, whether for donations or payments.”
Because one of Cake Wallet’s most notable features, Bird Pay, hinges on users posting their address publicly, Silent Payments is a game changer.
Unveiled approximately one year ago, Bird Pay enables Cake Wallet users to send bitcoin (or other crypto assets) to a contact using nothing other than an X handle.
The receiver simply has to add their bitcoin address, which can be a Silent Payments address, to either their bio or a pinned tweet, and Cake Wallet can fetch the information from there.
“CakeWallet will use the Twitter API, pull the address and send the payment to you,” explained Sharma, also noting that this same feature can be used via Nostr or Mastodon.
“There’s a place where you should put your Silent Payments address,” he added.
Cause For Concern
While the Bitcoin and Monero communities have embraced the privacy that Cake Wallet offers, Sharma is concerned that the U.S. federal government could turn out to not be so keen on it.
In an era in which the government is cracking down on privacy-enhancing Bitcoin and crypto services, including Bitcoin Fog, Tornado Cash and Samourai Wallet, it seems difficult for anyone who’s creating such privacy-preserving crypto technology to not think twice about what’s at stake.
“It does worry me — and not because we're doing anything wrong,” said Sharma. “But something could be twisted or construed to make it seem as if we are doing something wrong.”
As a precautionary measure, Sharma has moved the headquarters of Cake Wallet overseas, from Florida to Nevis and Saint Kitts, something that Roger Ver advised him to do.
He also discusses all updates to Cake Wallet with the company’s general counsel to make sure that Cake Wallet isn’t breaking any laws. While his lawyers have assured him he isn’t, he’s aware that skewed interpretations of laws and legal guidelines could potentially cause problems for Cake Wallet.
“If you dig deep enough into the way the laws are written, they might say, ‘No, you're a money transmitter business, even though we're not,’” explained Sharma.
“We're not touching users’ funds. We don't have access to them. Even though we built the app, once that app is on the user's phone, it's being generated on their phone, not on our servers,” he added.
“But they might come back and say, ‘But it connects to your node initially.’ Who knows? I'm just using that as an example — even though we give the option right up front for users to not connect to our node.”
Staying On Mission
Despite a concerning legal backdrop, Sharma and the Cake Wallet team plan to stay the course and to remain mission-driven, focused on making Bitcoin both easy and private to use.
“We have stuck to our ethos,” said Sharma.
“The team will call each other out like, ‘No, we shouldn’t put this feature in because it violates this privacy or that privacy or could in the future. We have those debates internally all the time,” he added.
And because Sharma has never taken VC money for Cake Wallet, the only people that he and his team have to answer to, aside from themselves, is their users.
“Since we’re not beholden to a VC, investment firm or an angel investor who's looking for a return, nobody’s on top of us. We're able to do what our users want, what our community wants.”
Source: Bitcoin Magazine - Bitcoin News, Articles and Expert Insights
#SilentPayments, #Monero, #Privacy, #Business, #Bitcoin, #CakeWallet