diff --git a/protobufs/auth.proto b/protobufs/auth.proto
index b0b3cd8..34eb330 100644
--- a/protobufs/auth.proto
+++ b/protobufs/auth.proto
@@ -20,12 +20,7 @@ message AuthChallengeSolution {
   bytes signature = 2;
 }
 
-message AuthResponse {
-  string token = 1;
-  string refresh_token = 2;
-  google.protobuf.Timestamp expires_at = 3;
-  google.protobuf.Timestamp refresh_expires_at = 4;
-}
+message AuthOk {}
 
 message ClientMessage {
   oneof payload {
@@ -37,6 +32,6 @@ message ClientMessage {
 message ServerMessage {
   oneof payload {
     AuthChallenge auth_challenge = 1;
-    AuthResponse auth_response = 2;
+    AuthOk auth_ok = 2;
   }
 }
diff --git a/server/crates/arbiter-server/migrations/2026-02-09-143015-0000_init/up.sql b/server/crates/arbiter-server/migrations/2026-02-09-143015-0000_init/up.sql
index 366cf76..1ca612d 100644
--- a/server/crates/arbiter-server/migrations/2026-02-09-143015-0000_init/up.sql
+++ b/server/crates/arbiter-server/migrations/2026-02-09-143015-0000_init/up.sql
@@ -14,24 +14,18 @@ create table if not exists arbiter_settings (
     cert blob not null
 ) STRICT;
 
-create table if not exists key_identity (
-    id integer not null primary key,
-    name text not null,
-    public_key text not null,
-    created_at integer not null default(unixepoch ('now')),
-    updated_at integer not null default(unixepoch ('now'))
-) STRICT;
-
 create table if not exists useragent_client (
     id integer not null primary key,
-    key_identity_id integer not null references key_identity (id) on delete cascade,
+    nonce integer not null default (1), -- used for auth challenge
+    public_key blob not null,
     created_at integer not null default(unixepoch ('now')),
     updated_at integer not null default(unixepoch ('now'))
 ) STRICT;
 
 create table if not exists program_client (
     id integer not null primary key,
-    key_identity_id integer not null references key_identity (id) on delete cascade,
+    nonce integer not null default (1), -- used for auth challenge
+    public_key blob not null,
     created_at integer not null default(unixepoch ('now')),
     updated_at integer not null default(unixepoch ('now'))
 ) STRICT;
\ No newline at end of file
diff --git a/server/crates/arbiter-server/src/actors/user_agent.rs b/server/crates/arbiter-server/src/actors/user_agent.rs
index 62fdd95..6aff08f 100644
--- a/server/crates/arbiter-server/src/actors/user_agent.rs
+++ b/server/crates/arbiter-server/src/actors/user_agent.rs
@@ -4,27 +4,40 @@ use arbiter_proto::{
     proto::{
         UserAgentRequest, UserAgentResponse,
         auth::{
-            self, AuthChallengeRequest, ClientMessage, client_message::Payload as ClientAuthPayload,
+            self, AuthChallengeRequest, ClientMessage, ServerMessage as AuthServerMessage,
+            client_message::Payload as ClientAuthPayload,
+            server_message::Payload as ServerAuthPayload,
         },
         user_agent_request::Payload as UserAgentRequestPayload,
+        user_agent_response::Payload as UserAgentResponsePayload,
     },
     transport::Bi,
 };
-use ed25519_dalek::VerifyingKey;
+use diesel::{ExpressionMethods as _, OptionalExtension as _, QueryDsl};
+use diesel_async::{AsyncConnection, RunQueryDsl};
+use ed25519_dalek::{SigningKey, VerifyingKey};
 use futures::StreamExt;
-use kameo::{Actor, message::StreamMessage, messages, prelude::Context};
+use kameo::{
+    Actor,
+    actor::{ActorRef, Spawn},
+    error::SendError,
+    message::StreamMessage,
+    messages,
+    prelude::Context,
+};
 use secrecy::{ExposeSecret, SecretBox};
 use tokio::sync::mpsc;
 use tokio::sync::mpsc::Sender;
 use tonic::{Status, transport::Server};
 use tracing::error;
 
-use crate::ServerContext;
+use crate::{ServerContext, context::bootstrap::ConsumeToken, db::schema};
 
 #[derive(Debug)]
 pub struct ChallengeContext {
     challenge: auth::AuthChallenge,
-    key: ed25519_dalek::SigningKey,
+    key: SigningKey,
+    bootstrap_token: Option<String>,
 }
 
 smlang::statemachine!(
@@ -83,6 +96,41 @@ impl UserAgentActor {
         pubkey: ed25519_dalek::VerifyingKey,
         token: String,
     ) -> Result<UserAgentResponse, Status> {
+        let token_ok: bool = self
+            .context
+            .bootstrapper
+            .ask(ConsumeToken { token })
+            .await
+            .map_err(|e| {
+                error!(?pubkey, "Failed to consume bootstrap token: {e}");
+                Status::internal("Bootstrap token consumption failed")
+            })?;
+
+        if token_ok {
+            let mut conn = self.context.db.get().await.map_err(|e| {
+                error!(?pubkey, "Failed to get DB connection: {e}");
+                Status::internal("Database connection error")
+            })?;
+
+            diesel::insert_into(schema::useragent_client::table)
+                .values((
+                    schema::useragent_client::public_key.eq(pubkey.as_bytes().to_vec()),
+                    schema::useragent_client::nonce.eq(1),
+                ))
+                .execute(&mut conn)
+                .await
+                .map_err(|e| {
+                    error!(?pubkey, "Failed to insert new user agent client: {e}");
+                    Status::internal("Database error")
+                })?;
+
+            return Ok(UserAgentResponse {
+                payload: Some(UserAgentResponsePayload::AuthMessage(AuthServerMessage {
+                    payload: Some(ServerAuthPayload::Auth),
+                })),
+            });
+        }
+
         todo!()
     }
 }
@@ -92,7 +140,7 @@ type Output = Result<UserAgentResponse, Status>;
 #[messages]
 impl UserAgentActor {
     #[message(ctx)]
-    async fn handle_auth_challenge_request(
+    pub async fn handle_auth_challenge_request(
         &mut self,
         req: AuthChallengeRequest,
         ctx: &mut Context<Self, Output>,
@@ -106,21 +154,112 @@ impl UserAgentActor {
         })?;
 
         if let Some(token) = req.bootstrap_token {
-            return self
-                .auth_with_bootstrap_token(pubkey, token)
-                .await
-                .map_err(|_| Status::internal("Failed to authenticate with bootstrap token"));
+            return self.auth_with_bootstrap_token(pubkey, token).await;
         }
 
+        let mut db_conn = self.context.db.get().await.map_err(|err| {
+            error!(?pubkey, "Failed to get DB connection: {err}");
+            Status::internal("Database connection error")
+        })?;
+
+        let nonce = db_conn
+            .transaction(|mut conn| {
+                Box::pin(async move {
+                    let current_nonce = schema::useragent_client::table
+                        .filter(schema::useragent_client::public_key.eq(pubkey.as_bytes().to_vec()))
+                        .select(schema::useragent_client::nonce)
+                        .first::<i32>(&mut db_conn)
+                        .await?;
+
+                    Ok(())
+                })
+            })
+            .await;
+
+        // let nonce = match last_used_nonce
+
         todo!()
     }
 
     #[message(ctx)]
-    async fn handle_auth_challenge_solution(
+    pub async fn handle_auth_challenge_solution(
         &mut self,
-        _solution: auth::AuthChallengeSolution,
+        solution: auth::AuthChallengeSolution,
         ctx: &mut Context<Self, Output>,
     ) -> Output {
         todo!()
     }
 }
+
+pub(crate) async fn handle_user_agent(
+    context: ServerContext,
+    mut req_stream: tonic::Streaming<UserAgentRequest>,
+    tx: mpsc::Sender<Result<UserAgentResponse, Status>>,
+) {
+    let actor = UserAgentActor::spawn(UserAgentActor::new(context, tx.clone()));
+
+    while let Some(Ok(req)) = req_stream.next().await
+        && actor.is_alive()
+    {
+        match process_message(&actor, req).await {
+            Ok(resp) => {
+                if tx.send(Ok(resp)).await.is_err() {
+                    error!(actor = "useragent", "Failed to send response to client");
+                    break;
+                }
+            }
+            Err(status) => {
+                let _ = tx.send(Err(status)).await;
+                break;
+            }
+        }
+    }
+
+    actor.kill();
+}
+
+async fn process_message(
+    actor: &ActorRef<UserAgentActor>,
+    req: UserAgentRequest,
+) -> Result<UserAgentResponse, Status> {
+    let msg = req.payload.ok_or_else(|| {
+        error!(actor = "useragent", "Received message with no payload");
+        Status::invalid_argument("Expected message with payload")
+    })?;
+
+    let UserAgentRequestPayload::AuthMessage(ClientMessage {
+        payload: Some(client_message),
+    }) = msg
+    else {
+        error!(
+            actor = "useragent",
+            "Received unexpected message type during authentication"
+        );
+        return Err(Status::invalid_argument(
+            "Expected AuthMessage with ClientMessage payload",
+        ));
+    };
+
+    let result = match client_message {
+        ClientAuthPayload::AuthChallengeRequest(req) => actor
+            .ask(HandleAuthChallengeRequest { req })
+            .await
+            .map_err(into_status),
+        ClientAuthPayload::AuthChallengeSolution(solution) => actor
+            .ask(HandleAuthChallengeSolution { solution })
+            .await
+            .map_err(into_status),
+    };
+
+    result
+}
+
+fn into_status<M>(e: SendError<M, Status>) -> Status {
+    match e {
+        SendError::HandlerError(status) => status,
+        _ => {
+            error!(actor = "useragent", "Failed to send message to actor");
+            Status::internal("session failure")
+        }
+    }
+}
diff --git a/server/crates/arbiter-server/src/context.rs b/server/crates/arbiter-server/src/context.rs
index b2d3051..6da6a80 100644
--- a/server/crates/arbiter-server/src/context.rs
+++ b/server/crates/arbiter-server/src/context.rs
@@ -3,6 +3,7 @@ use std::sync::Arc;
 use diesel::OptionalExtension as _;
 use diesel_async::RunQueryDsl as _;
 use ed25519_dalek::VerifyingKey;
+use kameo::actor::{ActorRef, Spawn};
 use miette::Diagnostic;
 use rand::rngs::StdRng;
 use smlang::statemachine;
@@ -11,7 +12,7 @@ use tokio::sync::RwLock;
 
 use crate::{
     context::{
-        bootstrap::generate_token,
+        bootstrap::{BootstrapActor, generate_token},
         lease::LeaseHandler,
         tls::{TlsDataRaw, TlsManager},
     },
@@ -44,6 +45,10 @@ pub enum InitError {
     #[diagnostic(code(arbiter_server::init::tls_init))]
     Tls(#[from] tls::TlsInitError),
 
+    #[error("Bootstrap token generation failed: {0}")]
+    #[diagnostic(code(arbiter_server::init::bootstrap_token))]
+    BootstrapToken(#[from] bootstrap::BootstrapError),
+
     #[error("I/O Error: {0}")]
     #[diagnostic(code(arbiter_server::init::io))]
     Io(#[from] std::io::Error),
@@ -55,7 +60,7 @@ pub struct KeyStorage;
 statemachine! {
     name: Server,
     transitions: {
-        *NotBootstrapped(String) + Bootstrapped = Sealed,
+        *NotBootstrapped + Bootstrapped = Sealed,
         Sealed + Unsealed(KeyStorage) / move_key = Ready(KeyStorage),
         Ready(KeyStorage) + Sealed / dispose_key = Sealed,
     }
@@ -78,8 +83,7 @@ pub(crate) struct _ServerContextInner {
     pub state: RwLock<ServerStateMachine<_Context>>,
     pub rng: StdRng,
     pub tls: TlsManager,
-    pub user_agent_leases: LeaseHandler<VerifyingKey>,
-    pub client_leases: LeaseHandler<VerifyingKey>,
+    pub bootstrapper: ActorRef<BootstrapActor>,
 }
 #[derive(Clone)]
 pub(crate) struct ServerContext(Arc<_ServerContextInner>);
@@ -138,9 +142,7 @@ impl ServerContext {
 
         drop(conn);
 
-        let bootstrap_token = generate_token().await?;
-
-        let mut state = ServerStateMachine::new(_Context, bootstrap_token);
+        let mut state = ServerStateMachine::new(_Context);
 
         if let Some(settings) = &settings
             && settings.root_key_id.is_some()
@@ -150,12 +152,11 @@ impl ServerContext {
         }
 
         Ok(Self(Arc::new(_ServerContextInner {
+            bootstrapper: BootstrapActor::spawn(BootstrapActor::new(&db).await?),
             db,
             rng,
             tls,
             state: RwLock::new(state),
-            user_agent_leases: Default::default(),
-            client_leases: Default::default(),
         })))
     }
 }
diff --git a/server/crates/arbiter-server/src/context/bootstrap.rs b/server/crates/arbiter-server/src/context/bootstrap.rs
index 2a00ed5..e765947 100644
--- a/server/crates/arbiter-server/src/context/bootstrap.rs
+++ b/server/crates/arbiter-server/src/context/bootstrap.rs
@@ -1,6 +1,11 @@
 use arbiter_proto::{BOOTSTRAP_TOKEN_PATH, home_path};
-use diesel::{QueryDsl, dsl::exists, select};
+use diesel::{
+    ExpressionMethods, QueryDsl,
+    dsl::{count, exists},
+    select,
+};
 use diesel_async::RunQueryDsl;
+use kameo::{Actor, messages};
 use memsafe::MemSafe;
 use miette::Diagnostic;
 use rand::{RngExt, distr::StandardUniform, make_rng, rngs::StdRng};
@@ -9,7 +14,10 @@ use thiserror::Error;
 use tracing::info;
 use zeroize::{Zeroize, Zeroizing};
 
-use crate::db::{self, schema};
+use crate::{
+    context::{self, ServerContext},
+    db::{self, DatabasePool, schema},
+};
 
 const TOKEN_LENGTH: usize = 64;
 
@@ -28,3 +36,70 @@ pub async fn generate_token() -> Result<String, std::io::Error> {
 
     Ok(token)
 }
+
+#[derive(Error, Debug, Diagnostic)]
+pub enum BootstrapError {
+    #[error("Database error: {0}")]
+    #[diagnostic(code(arbiter_server::bootstrap::database))]
+    Database(#[from] db::PoolError),
+
+    #[error("Database query error: {0}")]
+    #[diagnostic(code(arbiter_server::bootstrap::database_query))]
+    Query(#[from] diesel::result::Error),
+
+    #[error("I/O error: {0}")]
+    #[diagnostic(code(arbiter_server::bootstrap::io))]
+    Io(#[from] std::io::Error),
+}
+
+#[derive(Actor)]
+pub struct BootstrapActor {
+    token: Option<String>,
+}
+
+impl BootstrapActor {
+    pub async fn new(db: &DatabasePool) -> Result<Self, BootstrapError> {
+        let mut conn = db.get().await?;
+
+        let needs_token: bool = select(exists(
+            schema::useragent_client::table
+                .filter(schema::useragent_client::id.eq(schema::useragent_client::id)), // Just check if the table is empty
+        ))
+        .first(&mut conn)
+        .await?;
+
+        drop(conn);
+
+        let token = if needs_token {
+            let token = generate_token().await?;
+            info!(%token, "Generated bootstrap token");
+            tokio::fs::write(home_path()?.join(BOOTSTRAP_TOKEN_PATH), token.as_str()).await?;
+            Some(token)
+        } else {
+            None
+        };
+
+        Ok(Self { token })
+    }
+}
+
+#[messages]
+impl BootstrapActor {
+    #[message]
+    pub fn is_correct_token(&self, token: String) -> bool {
+        match &self.token {
+            Some(expected) => *expected == token,
+            None => false,
+        }
+    }
+
+    #[message]
+    pub fn consume_token(&mut self, token: String) -> bool {
+        if self.is_correct_token(token) {
+            self.token = None;
+            true
+        } else {
+            false
+        }
+    }
+}
diff --git a/server/crates/arbiter-server/src/db/models.rs b/server/crates/arbiter-server/src/db/models.rs
index 63810ec..7417875 100644
--- a/server/crates/arbiter-server/src/db/models.rs
+++ b/server/crates/arbiter-server/src/db/models.rs
@@ -28,21 +28,12 @@ pub struct ArbiterSetting {
     pub cert: Vec<u8>,
 }
 
-#[derive(Queryable, Debug)]
-#[diesel(table_name = schema::key_identity, check_for_backend(Sqlite))]
-pub struct KeyIdentity {
-    pub id: i32,
-    pub name: String,
-    pub public_key: String,
-    pub created_at: i32,
-    pub updated_at: i32,
-}
-
 #[derive(Queryable, Debug)]
 #[diesel(table_name = schema::program_client, check_for_backend(Sqlite))]
 pub struct ProgramClient {
     pub id: i32,
-    pub key_identity_id: i32,
+    pub public_key: Vec<u8>,
+    pub nonce: i32,
     pub created_at: i32,
     pub updated_at: i32,
 }
@@ -51,7 +42,8 @@ pub struct ProgramClient {
 #[diesel(table_name = schema::useragent_client, check_for_backend(Sqlite))]
 pub struct UseragentClient {
     pub id: i32,
-    pub key_identity_id: i32,
+    pub public_key: Vec<u8>,
+    pub nonce: i32,
     pub created_at: i32,
     pub updated_at: i32,
 }
diff --git a/server/crates/arbiter-server/src/db/schema.rs b/server/crates/arbiter-server/src/db/schema.rs
index f662849..38f8afe 100644
--- a/server/crates/arbiter-server/src/db/schema.rs
+++ b/server/crates/arbiter-server/src/db/schema.rs
@@ -19,20 +19,11 @@ diesel::table! {
     }
 }
 
-diesel::table! {
-    key_identity (id) {
-        id -> Integer,
-        name -> Text,
-        public_key -> Text,
-        created_at -> Integer,
-        updated_at -> Integer,
-    }
-}
-
 diesel::table! {
     program_client (id) {
         id -> Integer,
-        key_identity_id -> Integer,
+        nonce -> Integer,
+        public_key -> Binary,
         created_at -> Integer,
         updated_at -> Integer,
     }
@@ -41,20 +32,18 @@ diesel::table! {
 diesel::table! {
     useragent_client (id) {
         id -> Integer,
-        key_identity_id -> Integer,
+        nonce -> Integer,
+        public_key -> Binary,
         created_at -> Integer,
         updated_at -> Integer,
     }
 }
 
 diesel::joinable!(arbiter_settings -> aead_encrypted (root_key_id));
-diesel::joinable!(program_client -> key_identity (key_identity_id));
-diesel::joinable!(useragent_client -> key_identity (key_identity_id));
 
 diesel::allow_tables_to_appear_in_same_query!(
     aead_encrypted,
     arbiter_settings,
-    key_identity,
     program_client,
     useragent_client,
 );
diff --git a/server/crates/arbiter-server/src/lib.rs b/server/crates/arbiter-server/src/lib.rs
index afb7d56..da05100 100644
--- a/server/crates/arbiter-server/src/lib.rs
+++ b/server/crates/arbiter-server/src/lib.rs
@@ -2,32 +2,18 @@
 
 use std::sync::Arc;
 
-use tracing::error;
-
 use arbiter_proto::{
-    proto::{
-        ClientRequest, ClientResponse, UserAgentRequest, UserAgentResponse,
-        auth::{
-            self, AuthChallengeRequest, ClientMessage, client_message::Payload as ClientAuthPayload,
-        },
-        user_agent_request::Payload as UserAgentRequestPayload,
-        user_agent_request::*,
-    },
+    proto::{ClientRequest, ClientResponse, UserAgentRequest, UserAgentResponse},
     transport::BiStream,
 };
 use async_trait::async_trait;
-use futures::StreamExt;
-use kameo::actor::Spawn;
 use tokio_stream::wrappers::ReceiverStream;
 
 use tokio::sync::mpsc;
 use tonic::{Request, Response, Status};
 
 use crate::{
-    actors::{
-        client::handle_client,
-        user_agent::{self, UserAgentActor},
-    },
+    actors::{client::handle_client, user_agent::handle_user_agent},
     context::ServerContext,
 };
 
@@ -67,58 +53,9 @@ impl arbiter_proto::proto::arbiter_service_server::ArbiterService for Server {
         &self,
         request: Request<tonic::Streaming<UserAgentRequest>>,
     ) -> Result<Response<Self::UserAgentStream>, Status> {
-        let mut req_stream = request.into_inner();
+        let req_stream = request.into_inner();
         let (tx, rx) = mpsc::channel(DEFAULT_CHANNEL_SIZE);
-
-        let actor = UserAgentActor::spawn(UserAgentActor::new(self.context.clone(), tx.clone()));
-
-        tokio::task::spawn(async move {
-            while let Some(Ok(req)) = req_stream.next().await
-                && actor.is_alive()
-            {
-                let Some(msg) = req.payload else {
-                    error!(actor = "useragent", "Received message with no payload");
-                    actor.kill();
-                    tx.send(Err(Status::invalid_argument(
-                        "Expected message with payload",
-                    )))
-                    .await;
-                    return;
-                };
-
-                let UserAgentRequestPayload::AuthMessage(ClientMessage {
-                    payload: Some(client_message),
-                }) = msg
-                else {
-                    error!(
-                        actor = "useragent",
-                        "Received unexpected message type during authentication"
-                    );
-                    actor.kill();
-                    tx.send(Err(Status::invalid_argument(
-                        "Expected AuthMessage with ClientMessage payload",
-                    )))
-                    .await;
-                    return;
-                };
-
-                match client_message {
-                    ClientAuthPayload::AuthChallengeRequest(req) => {}
-                    ClientAuthPayload::AuthChallengeSolution(_auth_challenge_solution) => todo!(),
-                    _ => {
-                        error!(actor = "useragent", "Received unexpected message type");
-                        actor.kill();
-                        tx.send(Err(Status::invalid_argument(
-                            "Expected AuthMessage with ClientMessage payload",
-                        )))
-                        .await;
-                        return;
-                    }
-                }
-                todo!()
-            }
-        });
-
+        tokio::spawn(handle_user_agent(self.context.clone(), req_stream, tx));
         Ok(Response::new(ReceiverStream::new(rx)))
     }
 }