Web3's coming of age, part 3: The carrot and the stick
How UX shapes products
Henri Stern
|Dec 4, 2023
Today, transactions are often the core proxy for product value in web3. Indeed, if a product interaction doesn't lead to a transaction, it's easy to wonder "why does this product even use crypto?" Native transactions are one of the sole well-known product features only available to onchain systems today. But it needn't be this way.
The Carrot and the Stick
Crypto UX today is defined by a carrot and a stick. The carrot is used to entice the user, the stick beats them down.
The stick is the set of raw technical abstractions a user is forced to consider to interact with onchain systems today. What chain are you on? How much gas are you willing to put in? Have you properly stored your mnemonic? These are all part and parcel of user control, but they expose users to a huge amount of mental overhead in order to have even a simple interaction with a product.
The carrot is speculation, the notion that you can make a quick buck, and then some. Tokens incentivize nodes to participate in distributed consensus in decentralized systems. But they are also the main reason users put up with crappy UX. "I’m ok jumping through hoops because I have a clear incentive to do so."
Accordingly, it makes sense that defi has arguably found the most PMF in crypto to date: the bigger the stick, the bigger the carrot has to be.
At Privy, we believe abstractions have to be handled with care, and that any amount of intermediation introduces risk for the user. But we also believe that letting users manage deeply technical systems on their own is a dereliction of duty and we must create better interfaces in order to grow users’ ability to interact with onchain systems.
With better UX, the aperture of viable products that can be built in crypto will widen. By decreasing the size of the stick, we can decrease the size of the carrot. By improving the experiences of mainstream users in crypto, we can shape products in which speculation has a lesser role in the product experience. Speculation itself is a powerful feature, but it is just one of the tools in the arsenal of a hybrid stack (onchain/offchain) builder.
This is how we open up Mars beyond the Casino.
As crypto UX smooths and products evolve, we can expect distributed systems will increasingly be used to garner user consent, using systems like Ceramic or Spruce for instance. With greater accessibility, we will see the emergence of wholly new experiences online, that combine composable assets with deeply personalized user experiences, all while keeping users safe. It’s an exciting time to build at the frontier.
