Alby: A Hub For The Bitcoin And Lightning Economy
Company Name: Alby
Founders: Michael Bumann, Moritz Kaminski and René Aaron
Date Founded: Open-source project founded in December 2020 / Company founded in March 2022
Location of Headquarters: Fully remote
Amount of Bitcoin Held in Treasury: N/A
Number of Employees: 10
Website: https://getalby.com/
Public or Private? Private
Michael Bumann wants to make it simpler for people to send value across the internet.
This is why he created Alby — an open-source initiative-turned-company best known for its browser extension wallet app, which enables users to send and receive sats via the Lightning Network.
Bumann, a soft-spoken and introspective German web developer with decades of experience in his field, believes that bitcoin should be able to move as freely as information does on the internet. To accomplish this, he’d like to see Lightning integrated into all corners of the web.
“The mission is to make Lightning available within web applications,” Bumann told Bitcoin Magazine. “We want to make this accessible — to have this real deep integration, a very seamless thing in which payments are no longer blocking user experiences.”
Bumann and the team at Alby are currently succeeding in their mission, as Alby is one of the easiest Lightning wallets to both set up and use and has become a go to for creators around the world.
What many don’t know about Alby, though, is that its much more than just a Lightning Wallet.
What is Alby?
“Alby initially was the browser extension [wallet],” said Bumann of the Alby wallet, which lets users a create a convenient LNURL address (e.g., yourname@getalby.com) that they can use for sending and receiving bitcoin over Lightning.
“The goal was to have the browser talk to the Alby extension, which then talks to a node on the Lightning Network. Back then we had mainly LND (an implementation of a Lightning node) and talking to LND from a browser was and still is actually super complicated,” he added.
After some time, Bumann and his team at Alby created a wallet API, which can be used to integrate Lightning payments into any application. Think integrating Lightning payments into your favorite podcasting app to help you get paid as a podcaster.
Alby also provides its users with an LNDHub, which allows them to plug in and manage multiple Lightning accounts via one interface and node.
Many use the Alby browser extension wallet as a custodial wallet, but users can also use it in a non-custodial fashion with Alby Hub, which enables users to connect to Alby via their own node or pay a small fee to have Alby run a node for them.
“Ideally, we move in a direction where it’s easy enough for people to run their own nodes and their own wallets,” said Bumann. “Anything in between is an intermediary step.”
Alby has something for everyone from new users to the most advanced, which is part of the reason why it’s gained so much traction in just two and a half years.
On that note, Alby has grown faster than even Bumann and his team anticipated, prompting them make setting up an Alby account invite-only for the time being, so that they can keep up with demand — a demand that should only grow as Bumann and his team implement Nostr Wallet Connect (NWC).
Nostr Wallet Connect (NWC)
While Bumann acknowledges that Lightning is “still very small” and believes that we’re still in a “research phase” regarding the Layer 2 and its use cases, he sees Nostr Zaps as a great use of Lightning.
Beyond Zaps, though, Bumann and the team at Alby found another way in which Nostr could help further Lightning adoption.
They saw that they could use Nostr relays to send requests to pay Lightning invoices. And so they created a protocol called Nostr Wallet Connect (NWC) in conjunction with the team from Amethyst, a Nostr client.
Over the past few months, Alby has been prepping for the release of its new wallet, which will harness the new and unique capabilities that NWC gives it.
“We are currently about to launch our new self-sovereign Lightning wallet focusing on NWC,” said Bumann.
“It’s a new wallet that focuses on NWC as a protocol to interact with the wallet. It’s different from the typical wallet that has a send button, a receive button and a transaction list,” he added.
“[With this new wallet, users] only have to set up channels, liquidity and their keys only once. Then they can give certain permissions to certain applications and allow, ‘OK, you can receive money in my name. You can send a certain amount of money in my name. Here is a subscription service that I allow to pull $10 from my wallet each month’ — things like that.”
Bumann went on to share that a non-custodial Lightning wallet that accepts and dispenses payments in such a manner would be impossible without NWC. He added that the protocol isn’t necessarily optimized for human use. Instead, it was designed primarily to be connected to other applications, and he believes this will “make many more applications possible.”
“It’s a wallet that’s optimized for being always on, because one of the limitations we have with Lightning is that you have to be online to receive and send [sats],” said Bumann.
“Especially if you want to automate things in other applications, the wallet has to be available. That’s why we said, ‘Optimize for that.’ The user doesn’t need to interact with the application. You get it running once and that’s it,” he added.
This type of wallet can run from your desktop, a server or a cloud provided by Alby. Using the cloud option, the users’ data and keys will be encrypted by nothing more than a password.
What’s Next For Alby?
While Bumann and the Alby team will be fine tuning NWC has it’s rolled out — which will include the release of an NWC mobile app — they’ll also be looking at further ways to take Alby into the future.
Bumann noted that Alby still doesn’t have a plan to release its own mobile app as mobile UI is not well-suited for the integrated UX Alby offers via its browser extension product.
He says that implementing Bolt 12 is “definitely on the list,” though, it doesn’t seem to be his highest priority.
He’s also paying attention to burgeoning ecash systems like Cashu and Fedi and considering how he might be able to incorporate them into Alby.
More than anything, though, he and the team at Alby are paying attention to the feedback that they get from users in efforts to improve their product. To obtain this feedback, Alby prioritizes customer service.
“[Customer service] is also needed because the whole thing that we do is really early,” said Bumann. “It has rough edges, and even Bitcoiners that are excited are still facing problems.”
Bumann and the Alby team work to alleviate these problems in two ways:
“First, [we] trying to make it easier for users to get around these rough edges, to get on the Bitcoin and Lightning train somehow,” he said.
“Second, it’s just super important for us to identify where are people struggling. It’s a great feedback channel. We see it also as like it’s a bit of a collaboration with the users,” he explained.
And when Bumann says “we,” he means it. Despite being a co-founder of Alby, a project that’s grown by leaps and bounds in almost no time at all, he’s remained humble and in touch with those he serves.
“It’s very important that the developers that are in the code and building the features get the user feedback or are close to the user feedback,” said Bumann. “That’s why I, especially in the beginning, [do customer service] and we all still do it.”
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