Welcome to Part 1 of a new series “Consumer Applications of Crypto.” I won’t be going deep into blockchain technology, or making crazy price predictions. I’m trying to find out how crypto-based products are actually going to improve our lives as everyday consumers. I’m still exploring a bit, trying to learn more and more about crypto networks, and I’ll be writing here to share what I find.
Bring Your Own Wallet (BYOW)
The first topic I want to touch on is wallets. In order for us to use any crypto-based application, we first need to set up our own wallet. Whether you believe that crypto is legitimate or not, its wallet-based system may show us the future of how we’ll be using the internet.
Let me explain.
In the physical world, we all carry around some form of a wallet. In these wallets, we hold a method of payment, whether it be cash, cards, or something else. Wherever we go, we know that we’ll be able to pay with what we have in our wallets. It doesn’t matter if it’s a store or a restaurant, or what company owns that location. We know that we’ll be able to pay and won’t have to give away any information unless it’s relevant to our purchase. You have a credit card? Great, you can pay and be on your way.
The internet today doesn’t necessarily work that way. The websites where we spend most of our time locked themselves into closed ecosystems. When we want to make a purchase, we’re usually asked to sign-up for an account. So, we enter an email and password, re-enter our password, wonder if you trust the site but go ahead anyway, enter our address, and input our phone number. Then, we type out a long credit card number, expiration date, and security code, before finally going ahead to purchase. We have to do this on every — single—site. If you decide that you don’t want to set up an account, then guess what? Next time you make a purchase, you’ll have to do this all over again.
Imagine having to fill out huge forms every time you went to a new restaurant? It would be super cumbersome and make you not want to try going anywhere new. You would probably just go back to the same place over and over again to avoid the hassle. I can think of a few websites today that I default to using, partially for this reason.
Why can’t I have a universal account that works everywhere? Enter consumer application #1 of crypto.
When I started venturing out into crpyto-based web applications, I found out that I would need to set up a wallet. One of the most popular wallets was called MetaMask. It functioned as a browser extension, just like Honey, Pocket, and Instapaper. So, I set up MetaMask, sent over some Ethereum (the native cryptocurrency for this network), and off I went. I could go visit the websites of applications in the Ethereum network and see what they were all about.
When I visited these applications, I didn’t have to make an account or enter any information. I clicked a button on the website to connect to my wallet, then clicked another button on MetaMask to confirm, and boom! I was in. It took all of 5 seconds. No pain, no hassle, no extra passwords. I would take 2 clicks over filling out a whole form any day of the week.
A crypto wallet is like our own universal “super account” that we can carry with us from site to site. We just need to click a button, and we’re in with all of our information already there for us. No more forms, and more importantly, no more lock-in to any site. Since we don’t have to enter in a bunch of information, we‘re more free to bounce around to wherever is best for us. We can plug-in or leave at anytime without any extra effort. That’s real consumer choice. +1 for us.
Rather than having wallets or accounts owned by companies (such as Google, Apple, or PayPal), this wallet is built-in to a part of the internet. Like a physical wallet, we own it, so only we can control our wallet. But, this also means that we have to be super careful with it. This internet wallet is your debit card and your ID rolled up into one, and there’s no customer service number to call.
What we gain in ownership and frictionless sign-in today, we lose in central customer support. Where do we go from here?
Crypto wallets set the standard for frictionless experiences on the internet, and they may be the future of consumer choice and personalization.
Today, crypto wallets are mostly used for financial products. But, in a world where we bring our own “super account” with us to every site, what would we expect to happen?
A feature of blockchains is that every wallet’s transaction history is viewable by the public. So, once we connect our wallet, each site will be able to pull in information about us. They can see what we’ve spent, where, and on what (also why you should be careful with your wallet). In a funny way, this completely flips the personal privacy conversation. Rather than arguing that websites shouldn’t save any information about you, we’re letting them see everything.
This transparency creates an even playing field. Every site sees the same data about us, and we know exactly what we’re sharing. This can be powerful as we bounce around from site to site. Now every site can use this information to build a personalized experience for us without having to ask for anything.
Imagine that you’re visiting a new shopping website for the first time. In today’s internet, this site wouldn’t know anything about you. So, they might show you products that aren’t relevant, clothes that aren’t your style, or homegoods that don’t make sense for where you live. Until you build up a shopping history, they won’t know what to show you, and this can be a frustrating experience. But, if we used an Ethereum-based shopping website and connected our wallet, then we’d be bringing our history with us. The website could see what digital art we bought, where we spent our money, who we’ve interacted with, and maybe even pull our preferences from another site. They could construct their understanding of us based on the information that our wallets provide, then use it to create an experience that is relevant and personalized for us.
Imagine a world where the entire internet is personalized for you. This is the power that a universal wallet provides. I could even hold multiple wallets and choose which version of myself I want to show to each site. Like a finsta for the internet. *finsta = Fake Instagram account
Today’s payment apps (e.g., Apple Pay, Venmo, Cash App, PayPal, Shop Pay, Fast) might also be building towards this future. Today, they’re battling to build the most frictionless payment experience, and win as many new users as possible. If one of them reaches some critical mass of users, they could be in play for becoming the universal account for the internet. But, they each face the challenge as crypto in how widespread their network can get. Apple Pay will likely never be available on Android, Shopify may resist letting Fast in, and you can’t Venmo someone who only uses Cash App.
So, the question remains open. Could a payment app, an Ethereum wallet, or another crypto network become our universal “super account”? We’ll see what the future holds.
Update 3/13/2021: Enter the browser? If our portal into the internet can handle our identity, than why should we need to sign-in to anything?