Cryptocurrency investment app Abra announced to its users on Tuesday that it will switch to a “hosted model” to boost transaction speeds and introduce new features. The app was previously partially “non-custodial,” meaning users had control of the private keys used to validate transactions and recover lost wallets.
Abra CEO Bill Barhydt told Decrypt that it had been using a hybrid model, where some assets like Bitcoin and Ethereum were non-custodial. But others such as XRP and XLM, which were added to Abra later, were partially stored through third-party custodians. “This change simply unifies Abra under one simple architecture that is in-sync with what the vast majority of our users want,” Barhydt said.
While some users may prefer the non-custodial model, Barhydt said over half of their users already withdraw their crypto to hardware wallets for long-term storage. “Most of our users prefer that Abra offer faster trades via a high-quality custodian,” he said. “This migration just gives our users what they’re asking for.”
In recent months, Abra has also expanded to hosting native crypto assets. While the company had previously allowed users to directly hold Bitcoin and Ethereum, other crypto and fiat currencies, even stocks, could be invested in through synthetic versions that were pegged to the price of their real-life counterparts. When users wanted to cash out from a synthetic version, they initially had to always go back to Bitcoin. Now they can hold the real thing.
Barhydt said going native allows Abra to “dramatically lower” costs for offering these new cryptocurrencies to their users.