Breez, a fintech company known for its Bitcoin payment tools, has announced a partnership with Turnkey, a provider of wallet infrastructure solutions. This collaboration enables app developers to integrate non-custodial bitcoin wallets into applications that operate from centralized backend servers, a model widely used by large-scale consumer apps.
Addressing custodial risk for backend-run apps
Many mainstream applications manage millions of users from centralized servers, which historically required companies to hold users’ private keys in order to offer bitcoin services. This structure designated these companies as custodians—bringing regulatory responsibility, licensing requirements, and the burden of securing significant user funds.
The alternative to central custody has been device-based wallets, but integrating such solutions often requires rebuilding backend infrastructure, posing a challenge for scalability and user experience.
With the new approach, every user receives a unique wallet with cryptographic keys generated and secured inside Turnkey’s isolated secure enclaves. Breez and Turnkey both stated that neither the application server, Breez, nor Turnkey can access these private keys.
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AAPLApp backends retain only a credential that limits their operational power, while users keep sole authority to move funds. This structure allows backend-operated applications to introduce non-custodial bitcoin features at scale, without assuming custody or restructuring core architecture.
Mini dictionary: Secure enclave, a hardware-based security mechanism that isolates cryptographic keys, ensuring they are inaccessible to unauthorized software or systems. Secure enclaves provide an additional layer of protection for sensitive operations.
How the passkey-based approval process works
The solution leverages a passkey authentication flow. Each user creates a digital credential, such as a passkey, linked to Turnkey at registration. When a transaction is initiated, the server assembles the relevant details—amount, fee, and recipient—and presents them for the user’s approval.
Transactions only proceed once the user authorizes them with their passkey. The server cannot access or move funds independently, and users are not required to handle seed phrases or complicate their experience. The familiar application flow remains unchanged on the user side.
Turnkey’s infrastructure, used by various consumer finance apps, holds a SOC 2 audit for security compliance. Breez positioned this update as a step forward for exchanges, fintech firms, and neobanks seeking to provide bitcoin and stablecoin services without the challenges of asset custody.
| Solution | Custody Status | User Experience | Scalability |
|---|---|---|---|
| Centralized Key Storage | Custodial | Simple, but company bears risk | High, but regulatory challenges |
| Device-Based Wallet | Non-Custodial | User manages keys and recovery | Low, difficult to scale for server-based apps |
| Breez & Turnkey Model | Non-Custodial | No seed phrase, app workflow unchanged | High, fits backend-operated apps |
Expanding non-custodial services to fintechs and neobanks
By integrating Turnkey, Breez leverages Spark, an open-source network underlying its SDK, to allow backend servers to manage millions of wallets without ever storing private keys. Breez’s suite of features, such as Passkey Login, Stable Balance (to help with price volatility), and stablecoin support for USDT and USDC, lower the barriers to bitcoin adoption across consumer apps.
Breez highlighted that exchanges can now automate bitcoin payouts according to custom security policies, while fintech platforms can embed non-custodial bitcoin services within their existing interfaces. The result is a non-custodial model that maintains user control over all funds.
The latest release builds on Breez SDK’s ongoing attempt to simplify bitcoin integration for mainstream platforms reliant on centralized management. Combining new authentication methods and stablecoin support, Breez and Turnkey seek to offer a toolkit for bringing decentralized assets like bitcoin and stablecoins to larger audiences—without compromising user control.
Breez described the collaboration as a breakthrough for exchanges, fintech companies, and neobanks wishing to provide bitcoin and stablecoin access to large user bases while steering clear of custodian status and its associated risks.
