TrustToken AutoSweep Could Make Smaller Exchanges More Competitive
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TrustToken, the company behind the TrueUSD (TUSD) stablecoin, has launched a technology that could be a game-changer for crypto exchanges. A new feature, dubbed AutoSweep, has been integrated into a TrueUSD smart contract, potentially making it much easier to manage large numbers of crypto wallets.
As the name suggests, AutoSweep combines the addresses of account holders into a main wallet, removing the need for exchanges to manage millions of keys and dole out gas fees. End users, meanwhile, won’t notice a difference in the way their transactions are handled.
In a press release, TrustToken compared AutoSweep to email aliases, which allow multiple distinct addresses to be managed from a single inbox:
With email aliases, users can set up multiple outward-facing addresses (e.g. [email protected]; [email protected]; [email protected]) that receive emails into a single inbox. Likewise, AutoSweep allows anyone to create multiple outward-facing deposit Ethereum addresses that automatically settle into a single Ethereum wallet.
Exchanges traditionally provide different deposit addresses for each user and token. When a deposit is made, the exchange must create a transaction for each address, manage private keys tied to each address and keep the tokens in a separate hot wallet, all of which cost gas fees. Enter AutoSweep, which according to TrustToken Software Engineer Terry Li solves a major “pain point” for exchanges and merchants. Li told Crypto Briefing:
We help partners to reduce that. When a user sends funds to an address, AutoSweep automatically forwards the tokens to a central hot wallet. Think of it as aliases to the hot wallet. It’s easy to set up for anyone that wants to use this feature.
Security and Benefits
TrustToken has had the new AutoSweep feature audited and says it’s no less secure than current ETH addresses. TrustToken Marketing Manager David Steinrueck told Crypto Briefing:
We wanted to make sure we erred on the side of practicality and that it would be theoretically impossible for anyone to exploit any issue. It comes down to how ETH security works. Essentially, we are betting [that with] the distributed computational power of the entire global Ethereum network, it’s impossible for anyone else’s computational power to crack the system.
Meanwhile, the benefits of AutoSweep are two-pronged: exchanges no longer need to manage so many wallets, and funds are automatically forwarded to a main wallet, slashing the gas fees to zero.
Typically, exchanges must pay hefty gas fees to move tokens into their main wallet. In an era where crypto exchanges like ShapeShift are tightening their belts, the new feature is a sign of the times that could go a long way.
TrustToken designed AutoSweep for exchanges, including OTC platforms, and merchants that accept crypto. In fact, TrustToken says, AutoSweep could help to foster adoption among merchants who otherwise shy away from the challenges tied to accepting crypto as a payment method.
This feature is actually best for people with much less technical knowledge or who have fewer people to manage millions of wallets. This makes it easier for smaller exchanges or merchants to automatically handle so many alias wallets and keys without needing accounts for all of them. We had mainstream adoption in mind for users who want millions of uses but who don’t want to manage millions of keys.
TrustToken’s AutoSweep feature is now live on TrueUSD as the first use case, but is also public code. As a result, it can be integrated with any Ethereum-based token.
Smaller exchanges are expected to be the first guinea-pigs for the new technology, but someone might want to let Jeff Bezos know that it’s now even easier for Amazon to start taking crypto.
The author is invested in digital assets, but none mentioned in this article.