Meet Tux Pacific: A Unique Visionary in the Crypto Space
Tux Pacific stands out in the tech industry as a self-educated cryptographer who chose to leave college, openly champions the transgender community, and identifies as an anti-capitalist anarchist. Their beliefs are steeped in the foundational principles of the cryptocurrency movement, particularly from the era when Bitcoin was the dominant force and traditional banks largely ignored the sector. Recently, Pacific made an appearance on the July 7 episode of TechCrunch’s crypto podcast, Chain Reaction, where they shared insights into their journey and vision.
Entropy: A Groundbreaking Custodial Solution
As the CEO and founder of Entropy, a decentralized crypto custodian, Pacific announced that the startup has successfully raised $25 million in its seed funding round, spearheaded by Andreessen Horowitz and supported by Coinbase Ventures, Robot Ventures, Dragonfly Capital, Ethereal Ventures, Variant, and Inflection. Notable angel investors, including Naval Ravikant, Sabrina Hahn, and James Prestwich, also contributed to this funding initiative. This recent investment follows a pre-seed round in January, where Entropy secured $1.95 million to kickstart its mission.
Transforming Digital Asset Custody
Based in Brooklyn, New York, Entropy aims to revolutionize how digital assets are managed by offering a decentralized self-custody solution. Prior to launching Entropy last year, Pacific honed their skills in cryptography while working at NuCypher, a cryptography network in Berlin. They gained extensive knowledge in advanced cryptographic methods that now inform Entropy’s innovative approach. Traditional custodians, such as Fireblocks and Coinbase, operate on centralized models akin to banks, which can leave users vulnerable to security breaches and restrict access to their funds.
Reassessing Custodial Limitations
Pacific highlighted the limitations of existing custodial solutions, sharing stories of users who faced significant delays when trying to move their funds, sometimes risking substantial financial losses due to custodians being unavailable. In stark contrast, Entropy utilizes advanced cryptographic techniques based on multiparty computation, allowing users to deposit and utilize cryptocurrencies across any blockchain whenever they need to. This flexibility is particularly beneficial for decentralized autonomous organizations (DAOs) that require governance based on collectively established rules.
A User-Centric Approach to Custody
Pacific compares Entropy’s functionality to Google Authenticator, emphasizing that the platform does not offer its own wallet or user-facing products but rather manages the cryptographic signing of user data. This means that businesses and DAOs can safely store user funds without being tied to the limitations imposed by centralized custodians. Unlike many cryptographers who start with a protocol and build a user experience around it, Pacific reversed this process, envisioning the ideal custody experience first and then developing the protocol accordingly.
Innovative Business Models for a New Era
Pacific believes that Entropy’s competitive advantage lies in its willingness to challenge conventional custodial business models, which typically involve charging users fees for asset safekeeping. Instead, Entropy seeks to create a revenue model that benefits both the protocol and the users themselves. Although the nine-member team has not yet finalized this model, investors appear to be supportive of the approach. Pacific noted that during fundraising discussions, they were transparent about not having a defined business model, focusing instead on product development.
Aiming for a Distinct Audience
Entropy is targeting a different demographic compared to traditional custodians, according to Pacific. They clarified that their offering is not designed for large enterprises like JPMorgan but rather for individuals and decentralized entities deeply embedded in the crypto ecosystem. This niche focus stems from Pacific’s own experiences within the crypto community, which they describe as largely supportive, particularly in relation to their identity as a transgender founder.
Breaking Barriers in the Crypto Community
Despite facing some challenges as a trans entrepreneur, Pacific has found the crypto space to be remarkably accepting of diverse identities. They expressed a longing for more visibility of LGBTQ+ founders, as research shows that these individuals receive a disproportionately small share of venture funding. Pacific reflected on how witnessing trans entrepreneurs with similar political values during their childhood would have been immensely impactful.
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