The Path Ahead: Onboarding a Billion Users - TOKEN2049 Singapore 2022

hi guys Welcome to our panel the person has onboarding the next viewing users I am Alyssa Tai and the founder and CEO of pennoni we are the BC focused on early stage with three projects and today we have LSL um CEO and co-founder of Health Trust text trust is a custodian Services solution and they have very brilliant list of institutional clients and they also are a co-founder of clear pool a lending and borrowing protocol and we also have Haskell CEO of major obviously everyone has a ledger so yeah nobody let's ask the room raise your yeah raise your hand if you have a ledger well that's not everyone so for those 1980 it looks like 80 of it for those who didn't raise your hand you can go to our booth yeah the QR code and you get 10 discounts nice cool I've done my job and we also have JD uh he's a co-founder of polygon one of the most uh adaptive layer one protocol and one of the most traded token for sure um so yeah without further Ado I think everyone knows who they are uh so how about we start with what's new with you and your company so just give us an alpha yeah sure um well hex trust digital assay custodian we uh started about five years ago originally in Hong Kong as of today we have operations in Hong Kong Singapore uh Vietnam Dubai uh Milan and Bahamas and we have about 200 institutional clients and around five billion dollars in assets on the custody we are also we also started additional offering additional Services late last year uh so we we have a it was a trading arm a financing arm and we provide additional blockchain services such as taking governance Etc yeah Pascal cool so hi everyone um so what's new at Ledger is first we have reopened our Asian office here in Singapore um and Andrew is leading it kovid uh riots in Hong Kong you know we have like difficult years to maintain business in Asia but we are very happy to be back and token 2049 is an amazing event so happy to announce that we're back in business in Asia and so come see this at the Boost the team is there uh what's new is ledger you know a ledger we we focus on two things retail on one side Enterprise on the other and really what's new is the OS new or what continues to be new and I'll tell you because most of people don't know is now the platform is open so what it means for you if you have a business is you can use Ledger as a security platform and build apps on top of it we will make the security the best in the world this is ledger and so you can focus on your app you can focus on the user experience if you want to check us out it's easy it's developers.ledger.com so that's what's new so polygon uh scaling solution um many many dabs uh more users tvl so two updates uh on the business side like as you can see Starbucks launched their loyalty program on polygon uh Instagram launched their nfts so people influencers instagrammers can use mint nfts on on that application directly and those are on polygon on the tech side uh we are launching many things we are like you know very soon we have a ZK evm ZK all up test net coming up uh we have Avail datability Solutions also coming up um and we have like supernet going live very soon um so we are working with many many uh dabs around the globe institutions and everyone so happy to kind of you know work with them uh to scale blockchain since the next level yeah thank you yeah I think what our panelists have common in here is like we are all trying to offer different type of text solutions to help either individual or company scale and I think one of the concerns that will come to either web to a web 3 projects or companies is that about the security and we also have been seeing a lot of hack not least few days but like every month we'll see a lot of heck is like going on and I know you both have different kind of solutions towards like the security so maybe you can yeah on different level tell us a little bit about how do you solve the security concern from institutions and Retail maybe we start with yeah yeah we can start with institutions I think um so the security problem is something that uh was really already a problem at the beginning when the the blockchain industry started uh to really develop uh companies like Ledger ourselves and other uh and other companies in the same uh in the space we've been working uh to provide solutions that can allow institutions to actually come to the space uh in a in a safe environment I think if we look at the space what happened in the last six seven years most of the problems related to security have actually been addressed we addressed the the problems related to the the cryptography the problems related to hot wallets called wallets the problems related to kind of a spread taking a priority and distributing across different uh different signing entities etc etc so the first part of the security I think as of today with all the certifications with all the regulations that we have to comply with security as a process Etc is basically I would say being addressed so we know how to tackle this problem now as we move from the real use cases of blockchain and that's what is actually happening right so we need to not just use blockchain to store Bitcoins for investment or speculation purposes but we want millions of users billions of users to use blockchain every day to play their own games to own their own digital identity XR Etc so in that case we need to move from just the safe keeping of the asset in a secure way but to make the asset available for everyday uses of the asset and that is really a challenge because obviously we know that there's always a trade-off between how security assets is stored and how available it is to use but I think this is really what companies like ours are working on to make sure that we can make not only the assets safely secured in a device we're always ready to be used for all the different use cases that we're seeing kind of developing in the blockchain industry yeah maybe uh maybe JD can start with the layer one part because it's an underlying infrastructure yeah and then we can move to Pascal our retail institution side yeah yeah so we are very very uh kind of you know put our money in into the security uh of the protocol so we uh I think modit Gupta is very popular uh security advisor in the industry right now and he is our chief security officer at polygon and he has created a Ultimate Team to lead the the whole operations of the crypto and everything and our bridge for example uh we have like four billion dollars tvl on the on our Bridge uh we have sticking contracts which have like you know forty percent of those open supplier on on that on those smart contracts so we for the security of our users like very top priority for uh for us in general uh even if like for example we are launching zika Roll-Ups very soon it also we kind of you know help users directly to you know make their assets very secure we are working with institutions as well we are working with custody on systems as well uh multiple custody like fire blogs and uh so yes so we kind of know in general like VC is a kind of different level security is a different level for example users like wallets and everything for example we are working with sequence uh wallet which is like MPC based uh or multi account level like a smart contract based uh wallets uh something similar like you know the user level on the smart contract level also the Social Security level like we have like many validators running the uh decentralized systems and everything so we obviously like now we we are very careful where to put our kind of efforts for example like some people just start with from day one they just make everything decentralized even if they're smart not upgradable so we are very optimal like you know very seen like you know okay uh even if we write our code we make sure that it's we put out there we have big bounties uh on top of that so all those things we we kind of yeah comprehensive because only one park or wrong everything exactly right everything is connected so one loose end and you can lose money so yeah and about Pascal yeah well maybe to help with Clarity I think there is a common mistake that we the industry Keeps On Doing which is to call custody everything so custody there when you think about custody there are two things on one side you have financial institutions there are financial institutions they are or not regulated but you know if you want to hold coins on behalf of someone you become a custodian and those financial institutions of course need technology because you have to put the coin somewhere and the question is who do you get the technology from and then the second part of custody is custody technology and so you have companies like like Ledger uh or even you know delay ones that are pure technology companies and don't do the custody Ledger don't hold coins for anyone anywhere in the world Etc we power custodian with technology so they can become custodian and so this is a common mistake actually some I have a lot of conversations with VCS and they're like oh but Ledger you are like Anchorage we got nothing to do with Anchorage encourage does a business that is very very different from ours they are a bank they're a financial institution of course they have technology have they developed their own technology yes will they develop their own technology for the next 10 years probably not if you look at the world of custody outside of crypto there are five major custodians in the world it's a highly concentrated business and so it is very likely that crypto we follow the same paths you have many custodial actually you don't have so many custodians today in crypto but let's say that you have some custodians today in crypto there is strong possibility that tomorrow there'll be less there'll be a concentration and it will probably follow the same rules of having five or ten top actors to cover the world so when we looked at this world of custody in the normal world then the question is if you have five actors probably they do their own technology I mean what is so hard about building their own technology so I give you a news you know a fun fact they don't build their own technology they relied on technology partners and they spend billions of dollars buying technology why because technology ever evolves and so if you're a financial institution you have so many problems to solve that you will need Partners depending on the part of the technology stack that you need or you need partners for many things the same way that you hire lawyers you don't have all your lawyers internally you hire law firms and the same way they hire a law firm you're going to hire a specialist to do your security and so this is where Ledger comes in not just Ledger you have other technology companies in the space now I finished just with one thing the confusion in the space comes most of the time from technology companies that fail at setting technology and certainly they use the technology to build a financial institution it has happened in the past with bitgo this is sort of what's happening with fire blocks with copper etc etc selling technology is very hard and if you integrate the technology into a financial institution it's much easier to go to market it's uh yeah it's much easier to to sell and so this is sort of what's happening and so you see bid go fireblocks copper and it's a great strategy by the way I'm not being uh I'm not criticizing the strategies they start by presenting technology or even Anchorage Anchorage started as a technology company and they were like [ __ ] it we'll just build a custodian and they become a financial institution and so what I think is important is Market is that Marco there should be a segregation of Duty of companies that are doing technology being specialists at what they do and other companies uh being specialists at becoming financial institutions you will see there will be a shade of gray in the next five years where people you know where companies will build their own Tech be custodians be financial institution you can have guys like us that will focus on on technology but in 10 years you're going to have a segregation of Duty technology companies will do technology financial institutions will be financial institutions yeah I think Deja also it's like more like a retail facing fund so you also hold like a educational responsibility in getting like a common like common users to understand like how to like protect themselves I think that's also like an important role you guys play in a space yeah yeah and so to that point I think you know the the industry needs technology standards what works what doesn't work etc etc and best be very careful with the new shiny objects when it comes to security and PC is very cool but it's very new MPC was hacked not too long ago and it would be hacked again Etc and security needs time to develop and I think the education piece is actually very important but also standards are very important because as the end user what matter is the end user when they're going to trust their coin with custodian a custodian B custodian C and they have no idea how the tech is run this is usually where the hacks happen because everybody will claim technology superiority everybody will claim that they're as secure as but in the end it's not necessarily true yeah maybe let me add a couple of points here that I think are important so the first the first one probably less important is that um it's true that you have a lot of financial institutions today that are also playing the technology the technology provider role uh but I think at this stage of development of the industry where you have a technology that is evolving very quickly and whether were you if you want to be competitive as a financial institution you have to be fast enough or you have to be faster than the competition relying on always on third-party providers can actually either make you not uh competitive with respect to your competition or maybe not be as Innovative as you would like to be and I think that that's kind of sometimes the push that financial institutions as you rightly mentioned have to develop things by themselves by themselves instead of versus what happens in the traditional industry which is quite much more you want stable technology rather than very Innovative technology the second thing is for traditional custodians they do custody digital assets because the assets in the traditional world are still digital right but there the digital asset in traditional Finance they're kind of pure Ledger entries they don't do anything right they're just a an entry of what that represents some kind of ownership or settlement Etc in our world is a little bit different because the asset is just not an asset it's a piece of code it's a smart contract and it has certain Financial functionalities so certain Financial Services functionalities embedded in the asset itself so if you want to make this asset available to vote on a specific protocol to be staked to be lent out on a D5 protocol Etc you have to really be able to control the asset right to be able to sign generic transactions Etc so the financial services that are on chain not just the normal Financial Central centralized C5 Financial Services the kind of a at a level down closer to technology compared to the traditional Financial Services that's true I mean it doesn't change the point that I'm trying to make you know like again the market is one way today will be very different tomorrow I think you know it's not true that every company that does crypto finance will code directly on blockchains will be experts in defy Etc you know the segregation of Duty is how a company will scale in the future but you know okay I'll give you a fun fact I'll tell you who is our toughest competitor in the market so we have Ledger Enterprise selling to businesses and so when we go present to clients okay it's the Nano s that is the toughest competitor of Ledger most financial institutions in the space keep their crypto on Nanos so this is the state of the market today Nanos have not been designed to keep crypto for financial institutions Ledger Enterprise was but the market is still uh very young so we in this market there is a lot of things that we call security theater like it's fake security people talk about security a lot but they don't really do security security is typically if you're gonna run in any kind of Technology first if you're a security company and so if you if you if you want to do your own security number one you need to have an attack lab otherwise you can't do security because you need to be able to attack your own products every security company in the world has an attack lab we have the biggest uh and best attack lab in the space is called the dungeon it's in Paris we have 20 of the meanest hackers actually if you don't believe me you know give me give me your give me your website and then I'll tell you how it's broken you know give me your give me give me let me know where to attack and we'll probably probably break everything that you present and so if you're a security company first you need to have an attack lab just to make sure that what you think is security is really security and the second thing once you've attacked yourself you need to hire other attack labs to attack you on product and so finally you need to get certification and so I'm not talking about stock because that's process I'm talking about product and security certification no one in the space as product and Technology certification it's very hard to get is delivered by people and you know it takes very long and so so oh by the way no one apart from Ledger but uh it and that's why it takes time and and investment into security it's a huge investment and so financial institutions today I mean you know maybe they have unlimited money but if you have a good security technology for cheap then you can focus your money on growing other parts of your business yeah I think I think yeah I think other than security users um like massively I think I would say web3 to me is still like in the early and middle stage we still have like a long way to go most companies still not touching with three I know a lot of them are considering but they are somehow hesitant for multiple reasons so maybe you can give the sound Insight on how do you play your part uh to help accelerate the web to companies to adapt web3 to integrate maybe we can start from JD because I know polygon has a studio and you also work with multiple like either web 2 or like emerging like a web series startup yeah so for webto companies is still they are taking the custody of the people's users asset and creating the uh for example nfts or trading robino just recently started doing non-custodial uh trading platform on their under app so there is one major move by webto companies who started with the non-custodial product for their users so I think uh on currently what is happening is that all the webto companies are figuring out how they could integrate web3 ecosystem directly into the platform and for example some people are doing custodial way for example Starbucks what they are trying to do is that let give our users something on the web 3 level and if it picks up you can do much more thing on top of that and Robin did the same the crypto Market was like very very successful in the past so that it started in the Second Step second stage they started doing the non-custerial trading on on polygon so now like the polygon user or Robin Hood user you can trade your cryptos on chain uh on polygon without fees so uh that will bring like millions of users by the way like it is not a small thing like uh if you consider like the number of users in web 3 totally like you know in total like it's very very less compared to any app in web 2 companies right and this web to uh the more Robinhood did is was phenomenal like you know many people will just start using trading crypto on chain um what I see is that in the future like all the like measure of the web to uh companies start doing the similar thing uh Twitter I think doing something similar where you can generate your own wallet connect with your uh I'm not sure if you've already wrote out to everyone or not um but they were planning to do that like you know you you have like you know transfer some tip or subscription on the Twitter using the crypto uh and which is a non-custrial right so but the problem with the non-construction is again like this is security issue uh the people don't know how to uh use their assets and everything so we need a better security measurements for example NPC that is is growing very well as a tech wise uh there's a second a point is that second security aspect of a wallet would be maybe account abstractions and a smart contract based wallets and but still like you know it's very hard for users to understand so we need to figure out like how do we fix those issues um and make sure like no users are secure their assets are non-custodial uh and still uh they can use the this uh big big applications without any in any kind of no uh problems so still unknown like people are figure like there are many wallets are trying to figure this out like user experience for uh everyone in web3 but still like you know I see we have many work to do there and the status right now is it do you guys reach out to those like webto companies more or to like come to you right now yeah just curious about what Dynamics so we have we have a huge BD team for just for web to uh company so we go after them like maybe we talk with them see okay how how we can work together maybe it's a small use cases for example nft or simple non-custrial trading right so it's uh we just see like you know if they are interested at least if they are interested like what we can do with them uh and if they are interested maybe internally they talk with you know internal board and now like meta and due to Starbucks and ready they're also very interested okay let's do something uh but sometimes they don't know like what to do and then we kind of you know brainstorm with them figure out this key part and build on a polygon and push that yeah yeah and I think uh yeah it doesn't it has to be like everybody is ready like in a space like not just like one project or one layer is ready because there's like so many different parts to be integrated yeah maybe uh unless you maybe you can elaborate uh how do you try to onboard uh web to companies into website in your case yes for us it was a uh it was really a big bet that we did uh early in 2021 when kind of all the nfdn metaverse kind of Market was not as hot as it is today and maybe not even well known um our largest investor in HEX trust is a company called Animal Care Brands they're one of the leaders in the I would say metaverse game five web three uh market and since we started a collaboration with them we decided to uh I would say craft our offering towards companies that wanted to kind of Enter space and either develop a native web free application or kind of studying to from their web tool application and moving into the web three I'll give you an example um there's a lot of uh there's a lot of uh movement and Dynamics happening in the gameplay space we understood that there was a need for some products and Solutions in the in the space so next week we are going to launch a a new product um it's a it's been developed as a joint venture between extras and any Market Brands it's called Griffin um it is not just a wallet it is it is more of a kind of a an application that can be embedded in every web software or it's a it's a software it's an SDK okay it's kind of a wallet SDK with embedded kyc and passport and identity and it can be it comes natively with certain blockchain based games I can be embedded in any web3 application and I think really solves the issue of having to kind of bring your users to an application having to kind of download certain wallets uh go into kycs and then different platforms and then transfer the assets write down your uh your keys Etc so kind of combining what we had what we're offering on the custody side and bringing a solution together with any Market Brands specifically for gaming like for games it is yeah it is specific for uh for gaming at least for now but I mean it is not necessarily limited to uh to gaming so for example we are always games but I mean we're thinking of using it for example in defy for some kind of permission use cases of Define protocols and we're very excited I mean it's going to go live next week Griffin so you can check it out on them yeah and Pascal I know like obviously later also worked with a fashion company it's like Fendi till lunch like a very fashionable like a item to tap into like the fashion market and I also see you guys partner with a lot of different webto companies yeah what's your secret in onboarding those web 2 companies yeah I mean there are two answers to your question you know first there is a cultural aspect to Ledger that we are developing now and you know these core Brands the Fendi that you're referring to but also at weeblo and we have a bunch that are coming just like you know web 3 is going to be part of your everyday life and so we're just trying to show to people like how to start interacting with your with the device and and how do you finally interact with web3 how does web3 comes into your normal cultural life and you know cultural the cultural aspect of of what we're doing is extremely strong you know people when they get into crypto it is Meaningful to them like it is not it's not like downloading yet another app on your iPhone it is something that has much deeper meaning it is something that defines you almost and so the cultural aspect is uh very important but there is this phenomenon you know the uh yeah unless you just mentioned it like you know it's all about you know those nfts that was an interesting phenomenon it's not it's not very old you know it's started like you know a long time ago from a technology perspective but you know from a usability perspective and go to market it's like what two years a year and a half and so that's bringing in the game of web 3 a lot of new users you know people that didn't really care about the wars between Bitcoin and ethereum and now they they care more about Collectibles they care more about gaming they care more about like you know all these experiences and so web 2 companies especially Brands and you know back on the cultural aspect sort of can't ignore this cultural phenomenon and so for a lot of Brands it's a very natural extension of what they're doing all the brands have tried to go digital in the past 10 years and now they're trying to go web3 because it's a very natural extension of what they do and Brands and especially luxury Brands understand this very well because if you have a very nice Chanel bag you know to have a very nice nft that goes with it I mean you know there is something that is very natural and where they also understand that the this nft could have utility when it comes to the channel back they could be it could be a Tracker it could be but also it could be a beautiful piece of art and so what's happening is you know Brands come to us for support in terms of how they can handle their nfts like how they can win them how they can distribute them Etc but very quickly we talk about like probably the most important thing for them which is treasury management once a brand decides to go into crypto they have a real question of Treasury management I mean Northeast will run on layer one layer two I mean those nfts will run on layer 1 or Layer Two whether they use Solana tezos polygon ethereum the question is you know to get those nft you you need to have money first Etc so it's very interesting conversation and I think this is how Brands and web too I mean I think what you call web2 FN well we would call web2 in your question would be the brands coming to the space I think this is the entry door and it's happening very fast too it's not something that they're thinking about doing like in in 10 years again it's a very natural extension of the business so it's really something that they're doing now it's happening and we are about to announce a bunch of Partnerships oh you're about to announce what a lot of Partnerships a lot of brands have signed with us but not today okay okay cool cool we'll learn till that yeah come to our last uh question uh it would be like what would be the you know your real mad for this a couple of years and I think it also ties to probably where do you see uh which sector is picking up because there are so many sectors in webs readers I mean there's like nft makeovers and obviously defy still get going strong yeah so just curious uh how would you pick up the trend and integrate your future roadmap yeah maybe um JD yeah yeah um so to answer a question like on the roadmap why is like we already working on the multiple products ZK rollers coming very soon we have supernets coming over where if if you are building a games and if you want your own chain uh you can build in the supernet um we have zikril so also open it will be converted into zero of Sanity in the future as well so it's kind of a part of the package uh for the for the people for the developers um we have Avail and multiple other products coming off down the line three to five years we are working on multiple uh research problems called statelessness where data can be everywhere anywhere else and then blockchain will be very very abstract and you can verify the state and the data without downloading the all the blockchain itself so we are working on that uh we are also working on like you know how to like in build bridging between the multiple chains like how users would feel like moving from one chain to another chain moving there are sets uh you know when we have multiple multigen world uh on the industry wise as a platform we don't kind of uh choose like if if you want to go with the gaming nfts or if you want to go with a D5 or Dao or any other industry right we are open to all uh as a platform we kind of now help uh every industry but what I see right now like now gaming nft leading the whole ecosystem so far because it's very easy to understand for users they don't have to worry about like what is going on internally in the in the D5 protocol everything so it's very intuitive uh for normal uh web to what who doesn't understand like who don't understand uh web 3 world or anything tech tech uh also right so for for them like gaming nfts I feel like you know driving the whole ecosystem right now uh for uh you know many many game studio also looking into that nowadays uh how do they kind of know Drive the web 3 ecosystem as well in their games um so there won't be any one particular um industry we are targeting we are kind of everything uh so far so but yeah but of course like no gaming nft is a huge industry and that's why like now we created this polygon studio just for just for that but now like we are expanding it to for uh D5 as well and multiple yeah yeah I think yeah you know we're album Builders at right now are we more saturated in games or yeah so currently like gaming we have seen more people uh kind of you know going towards that meta was for sure uh because the hype recently created uh D5 people want to create D5 but the problem is that uh liquidity Etc like you know very hard to get by and also like there is there are very few users on the device side so still people figuring out like what to build on D5 how to so now like people also talking with institutions uh fintech web 2 companies to how to kind of migrate them on the D5 the bridge between those two worlds so uh still people people there are few people building on those lines like web 2.5 kind of a uh path so let's see how it how it pass out oh yeah and maybe I'll see how you can give us some more insights about your yeah your future roadmap and no I mean I completely agree I think what's um what's really what's really interesting right now that it's that is happening is that um it looks like it's all coming together right so in the past we had oh no I don't know uh stable coins we have sdos yeah I'm just trying to get some Alpha a lot of you guys yeah we had D5 we had MSDS and everything but now I think the alpha if you're on the alpha I think uh we will as the as these all these platforms and solutions are really improving uh not just in terms of performance now we have better obviously better networks but we have better Solutions we have better D5 protocols better games and everything uh so the the user base is growing there's actually adoption there are actually for the first time probably since we study in the industry there's actually people that are using the blockchain for something and it's all coming together uh very well of having kind of a decentralized exchange within a game where you can swap a coin for another and then you can use a bridge and move seamlessly with a decent or good ux already from one chain to another so if you want the alpha I would say that we'll see C5 services not really uh kind of losing a little bit of market share when compared to what is kind of being offered in the in the D5 space right and also like uh for regulation wise what's happening is that if you go in the D5 Direction regulation might follow you like you get some notices from the SS and everything gaming other way around like getting an nft like you are pretty secure and it's kind of you know their own ecosystem so it's very easy to experiment there uh in a crypto also yeah there's one more point and Pascal was coming and was picking up except for Alpha you can tell us the announcement you can tell us now no no it's okay so you know you ask me what's coming I'm looking at the ruin I'm like so guys what's coming I don't know we don't know and um and we focus on the core which is the security platform and we want to be continuing on being the best at what we do in terms of endpoint security and like I said at the beginning developers.ledger.

com then you know the market will tell us what's new and what's next and this is why we've opened the platform because we've seen in the past that you know I I would dare anyone to say that the they saw coming the nft boosts you know suddenly picked up and you don't really know how uh why etc etc but and why was the year of nft 2021 and not 22 or not 2020 you know there are many things that are played that sometimes you don't control don't understand there is you know the the protocol layer I mean you know whether it's layer one layer two Etc you know this is if you try to build a security platform around all these protocols that are all evolving already that's that's hard enough as a job and so being able to predict the future of every usage that then is going to come until onto these type of protocols that's very difficult what we know is the future is not just going to be Finance I mean you know this industry has been focused on finance for a long time and so that's good and well and you know the future of Finance is crypto but there are many other uh things that will become crypto we're talking about those Brands and this nft phenomenon so the Loyalty uh uh Health uh they they may identity there are many things that will come uh and those things will be secured by your Ledger and so but we know that we won't develop every app there's not enough time not enough developers that we can hire and so we are counting on you to do this with us okay cool yeah I think we are right on time and yes thanks everyone for coming and thank you for our amazing panelists thank you yeah thank you