Lessons - Keep Your Crypto Safe | Pascal Gauthier - Chairman & CEO of Ledger

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All listeners can save 30% off their first order. Just head to cornbreadhemp.com slash success and use code success at checkout. That's cornbreadhemp.com slash success code success for 30% off your first order of these amazing gummies. In this lessons episode, discover how the collapse of FTX reshaped the crypto industry forcing a shift towards self-custody and redefining trust in digital assets, learn why centralized exchanges lost credibility, how self-custody became a necessity and why crypto's future depends on balancing security with usability. Do you find that because you're sort of boots on the ground so I don't want to make assumptions but do you find that more people are still keeping their crypto on the spot where they bought it or do you see user adoption to hardware people understanding security better. No, we've seen people understand money and they don't want to lose their money. So now a lot of people lose money. A lot of people lose money but after FTX is like you know when you burn yourself and you know not touch the flame anymore. So FTX was the big earthquake I think much bigger than you know mongogs or you know all of these things that happened in the past and by the way they keep on happening and they will keep on happening. FTX was not the last. The same way that lemon brother was not too big to fail like you know it's like why would you trust a central authority with your money. I mean exchanges are very useful like you should use them to do the trade but like you should never leave your coins on an exchange. And so I think people understand that and we've seen this in our numbers like it was you know a hard way to learn but but but it was away and and you see it in the coins moving from exchanges to sort of somewhere else and we see a lot of coins moving to our platform and then we see a lot more people now are engaging with the services that we have in later lives especially the buy the sale and the swap services the numbers are you know very impressive you are like you know triple digit gross and very constantly in q1 continuing in q2 when the market is not definitely not doing a triple digit gross. No no no at all not at all. So you see is you're not even taking over people that are like very very adamant crypto users. You still are you're bringing people in. Yeah. It was never used crypto before even in a on the transaction thing what I'm describing is more like our user base now understand that the undo more was ledger than just store the crypto and they prefer to do the trades from their ledger rather than from the exchange. So they so they so they they keep it in the ecosystem correct but you also see people like you still see of the course the industry is not growing a triple digit growth but they all see people that are are entering crypto with ledger versus entering crypto with coinbase and keeping things on coinbase. Oh yeah for sure and actually more and more like well first of all before in 17 it was not possible so yeah to do coinbase first and then ledger second in 23 now first of all it's not just cryptocurrency but it's also NFT so sometimes you enter you enter through an NFT and not really through through crypto you can go and open c take your credit to debit card you know coinbase providing a service and then you buy your NFT and then you have to put it somewhere and actually through the payment service coin pay will ask you what you want to put it and so it could be on your minimize could be on your ledger etc etc and so yes more and more actually what we've seen in 22 when everybody was saying it was a bear market we saw that sure and certain things you know certain things were not flying as high as they would have had in the past but other things like you know the NFT business and those communities being built around those projects kept on growing and so that brought a lot of people in that brought a lot of ledgers and and what do you know now again you see you see people that are older crypto users as well as new crypto users using ledger for all the transactions they want to take care of what do you think is the key to user adoption do you think that there is unfortunately the requirement for more FTX type things that I'm actually not for not user adoption so that would be that would be migrating people over that are already crypto users but let's say bringing new people in so FTX pushes people away that have never touched crypto it makes them scared they say oh thank goodness I never bought any crypto because look at what just happened but what on the flip side of that what is the key to user adoption okay but first I think so far everybody got it wrong to think that speculation over coins was actually crypto I mean it is not crypto to speculate on FTT on FTX that's like the worst of financial speculation I guess and if to you crypto just like buying an Apple stock I mean you know sure like you can do that but I don't think is the use case for crypto and by the way like you know the token only has value if you bring security to the blockchain and if the blockchain has a vibrant ecosystem of developers companies applications get right that are built on top of it and so I think that the even this the market is just taking care of speculation like you know they're not looking you know sort of deep enough into the protocols etc and you have like and it's difficult because you had so many like meme coins that have like sort of no value but it's just like people pumping and dumping the market that it makes that whole speculation aspect of crypto a bit ridiculous if you want my honest point of view I think where crypto is interesting is if it's in self-custody because this is why and how it has been designed like you know if you used to leave your crypto at a bank again sure but why there are other things that you can invest in that are that are probably good good investments and yeah so the interesting thing is like what can you do with your with your private keys and how can you engage in you know product they're interesting like defy is one a good example if you don't have your private keys you cannot really engage in defy we always overlook payment as if it's a given but I still think that store value and payment with Bitcoin or Lightning or payment in general with crypto is the killer app I mean you have like a peer-to-peer global payment network isn't interesting how you know your offices on that as much as they said because that was the original white paper yeah and this is where it's amazing like you know to pay anything for me in the US with my European credit cards oh my god like it's so difficult it's very difficult like it depends what you want to pay etc I mean if you live on you know five dollars a day I guess you good but like if you have to go to hotels you're entertaining you know your customers because you you have a business dinner we are certainly ten people come you know that has a cost etc and if you start to use your credit cards like you max them out like you know the one after the other etc and so and and the fees that you pay like every time that you go to the ATM in the US like four dollars to get a hundred dollars out that's ridiculous and so yes payment with crypto is a huge case you know and if you if you think that it punishes to volatile okay fine so do it in stable coins and like that's I think that's what people actually have to that's a really good point a huge shout out to bank on yourself for supporting today's episode entrepreneurs here's the retirement secret that Wall Street doesn't want you to know while you are pouring everything into growing your business they want you gambling your future in their 401k casino with no guarantees as a business owner you already take enough risks why gamble with your retirement to it is time to discover the financial strategies 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report that's bank on yourself dot com slash Scott bank on yourself dot com slash Scott so people that are scared of crypto because of FTX FTT or anything else you're right it's because they're focusing on the wrong thing because I think too many people tried to gamble on it for a long period of time and they realize that oh it actually is volatile it doesn't just go one way it's yeah I can go both ways now it's like going to the casino and be like fuck you know I got it yes yeah that's how casino's work yes that's that's the casino that's not a good behavior you you shouldn't you know when I when I got into crypto the theory was to say you only invest in crypto what you can lose and then you're long like you wait like you know it is not like coming in and out and people that are trying to buy low sale high you know sure like everybody would love to be able to time the market but it doesn't work like that how do you balance when you're building this hardware product how do you balance security and usability because you're attracting you're attracting the most complex users that want the most complex features as well as someone's parents that just are starting it for the first time okay so first of all I don't think we're building technology for parents or grandparents sorry to to bring the news to the parents and grandparents are using this podcast but we are building technology for the younger generation you know I think if Bitcoin and crypto have to become what they ought to become you know it will be for the younger generation I remember when I was a kid we switch uh Frank's from the old Frank's to the new Frank's and it was the division of a thousand I think no division of a hundred something like that uh a thousand ancient Frank's where suddenly ten new Frank's and I remember my grandmother never being able to actually is on to my grandmother did the switch but her sister never did the switch so she would always talk to me in old old the old innovation etc which always I always tell that it was going to be super rich but actually you know I had to do the math and you know the division in my head and in the end I was not that rich and so my point is other people move with technology and it doesn't matter if your father or grandfather etc like if you pay attention and you move with technology you will understand but the technology is developed for younger generations okay so now that I've said that how do you combine you know security and ease of use you do so stacks was an interesting story where Tony Fadel the inventor of the iPod joined ledger and to design stacks and there has been that healthy tension between Tony it was a product guy and you know one's product features and a product easy to use and the ledger team that is a security team and it's like that's not possible that's not possible we can't do that etc and so in the end you you make it work and you make it work by saying number one there is zero compromise on security ever like there's no it's not even a discreet we don't even open the discussion if there is a flaw or if there's a way even if it's very difficult that someone could get into the device then it's a no go then we have to change design we have to change your product etc so but once you you pass that hurdle of zero compromise on security then you try to develop products where basically you make the onboarding easy and the connectivity easy there's a two pain points that you're really trying to to solve for so I need to set up my bank account I need to set up my wallet I need to set up something how easy it is and by the way coming back to your previous question I'm like oh this shit is hard I don't know like you know last time I tried to set up like an exchange account he was an easy you have to have your ID you know you need to understand the kind of levels you know so level one is like okay just one ID level two you need two IDs approved for residence etc like it's not so easy like to register at a bank it's not so easy either some make it like easier than others like rebel it as a very slick service but this is why they're super successful yeah yeah you're right actually because they they brought that into into into the market so even in the the old financial market most of the UX UI are really bad and so I would actually argue that what we're doing now and especially we stack in terms of onboarding is going to be flawless and then in terms of connectivity is like okay once I have that thing like what can I do with it that's the second problem that you're trying to solve and to make it as connected as possible think about the iPhone like the iPhone was a hit because suddenly you could connect to the internet thanks for tuning in if you found this valuable don't forget to hit that subscribe button so you never miss an episode and if you want to dive deeper into this conversation check out the links in the description to watch the full episode see you in the next one