SEP-10

Key points

• SEP-10 is a Stellar network standard that defines how to authenticate a user through the signature of their key.
• It proves that a person controls a given account, without relying on a password or traditional registration.
• It is used by services that integrate with the network, such as on-ramps and off-ramps, to verify account identity.

What is SEP-10?

SEP-10 is one of the standardization proposals of the Stellar ecosystem, known as Stellar Ecosystem Proposals. It defines an authentication method based on cryptographic signature: instead of a username and password, the user proves control of an account by signing a challenge with their key. It is a form of authentication that relies directly on blockchain keys, suited to services that operate on top of the network.

How it works

The flow follows a challenge-response logic. The service that wants to authenticate the user generates a challenge, a specific message, and sends it. The user signs this challenge with the private key of the account they want to prove they control and returns the signature. The service then verifies, using the corresponding public key, whether the signature is valid. If it is, it is proven that the user controls that account, without the private key ever needing to be revealed.

The advantage of this method is that it dispenses with traditional credentials. There is no password to create, store, or steal; proof of identity comes from possession of the key, the same mechanism that already protects funds on the blockchain. Once authenticated, the user typically receives a session token that authorizes their subsequent interactions with the service for a period of time, avoiding the need to repeat the process for every action.

This standard is especially relevant for services that connect the Stellar network to the traditional financial world, such as on-ramps and off-ramps. Before allowing operations like deposits and withdrawals, these services need to be certain which account they are dealing with, and SEP-10 provides that assurance in a standardized way. It is usually the first step, on which other standards, geared toward the deposit and withdrawal flows themselves, rely.

Understanding SEP-10 helps in understanding how services built on the Stellar network securely verify who controls an account.

Why it matters

Understanding SEP-10 helps in understanding how services built on the Stellar network authenticate users securely, using the keys themselves rather than passwords. For a company integrating with this network, it is a central technical piece. This is a technical concept, and none of it represents any operating recommendation.

Risks and limitations

SEP-10 proves control of an account, but on its own it does not replace identity verification required by applicable rules, which depend on other processes. Its security rests entirely on the protection of the private key: if it is compromised, authentication is too. In addition, it is specific to the Stellar network. None of this represents an operating recommendation. </content>