Breez and Turnkey Enable Non-Custodial Bitcoin for Backend Apps

Breez has announced a partnership with Turnkey to facilitate the integration of non-custodial bitcoin wallets into applications that operate from their own servers. This collaboration addresses a common challenge faced by mainstream apps, which typically handle millions of users and have relied on holding user keys on their servers, making them custodians with associated legal and security responsibilities.

Under the new model, each user receives a wallet with keys created and stored securely within Turnkey's enclaves. These keys remain inaccessible to the app's servers, Breez, and Turnkey itself. Instead, the backend holds credentials that specify permissible actions, while the authority to move funds remains with the user. This setup allows large consumer apps, including exchanges, fintechs, and neobanks, to add non-custodial bitcoin services without overhauling their existing infrastructure or taking custody of user assets.

The process involves users registering a credential, such as a passkey, during signup. The server then prepares a transaction, which the user approves, completing the transfer without the app ever handling seed phrases or private keys. Turnkey's infrastructure, which is SOC 2 audited, supports this process and is used by various consumer apps.

This development is positioned as a way for financial services to offer bitcoin and stablecoin functionalities while maintaining user custody. It complements other Breez SDK features aimed at simplifying bitcoin integration, such as replacing seed phrases with passkeys and supporting stablecoins like USDT and USDC.

Overall, this partnership enhances the scalability and security of non-custodial bitcoin solutions for large-scale applications, potentially broadening crypto adoption in mainstream financial services.