Henri Stern - Privy, Product-Building, and the Future of Embedded Wallets
Nov 15, 2023
auto_awesome
Henri Stern, Co-founder and CEO of Privy, talks about his journey in Crypto and how it led him to build Privy. They discuss Privy's product mindset, the current wallet landscape, and the tradeoffs of building embedded wallets. They also explore the future market structure for wallets and the importance of user-focused ecosystems.
Privy pivoted to become an embedded wallet company, focusing on building an onboarding system that allows users to seamlessly connect their wallets to email addresses, phone numbers, and social logins, creating a progressive onboarding process.
Privy recognizes the importance of self-custody for user freedom, while also addressing the UX challenges faced by developers in the crypto space, aiming to strike a balance between user control and developer flexibility.
The future of embedded wallets lies in offering users the flexibility to choose their own wallet experiences, with Privy envisioning a future where users can leverage self-custodial tools in any product and easily move their assets between apps, fostering innovation and user empowerment in the crypto space.
Deep dives
The Origins of Privy
Privy started off with the idea of self custody and data ownership in mind. The founders recognized the potential of blockchain technology to enable new forms of product interactions, but also acknowledged the current UX challenges in crypto products. They saw the need for a system that prioritizes user privacy and data management across different apps. The goal was to create a platform that helps developers take better care of their users' data upfront while embracing the concept of interoperability in web3.
The Evolution of Privy into an Embedded Wallet
As Privy developed its data system, they realized that the main pain point for developers was authentication. It was difficult to verify user identities across different apps, especially in the context of interoperability. Additionally, developers were using Privy to store identifiers alongside wallet data, indicating the need for an onboarding system. To address these challenges, Privy pivoted to become an embedded wallet company. They focused on building an onboarding system that allows users to seamlessly connect their wallets to email addresses, phone numbers, and social logins, creating a progressive onboarding process. This approach aimed to make the interaction with blockchain-based apps easier and more user-friendly.
Privy's Vision: User Management and Self-Custody
Privy sees itself as a user management company, prioritizing self-custody and data privacy. They aim to empower developers to build delightful and customizable interactions, while ensuring users have control over their keys, assets, and data. Privy recognizes the importance of self-custody for user freedom, while also addressing the UX challenges faced by developers in the crypto space. They strive to strike a balance between user control and developer flexibility, building a system that allows users to move their data seamlessly between apps while preserving privacy and security.
The Future of Embedded Wallets and Wallet Fragmentation
The future of embedded wallets lies in offering users the flexibility to choose their own wallet experiences. Privy believes that wallet fragmentation is a feature rather than a bug, as it allows users to have different profiles and levels of privacy across various apps. They aim to provide a range of wallet options, including embedded wallets for mainstream users and consumer wallets for power users. Privy envisions a future where users can leverage self-custodial tools in any product and easily move their assets between apps, while developers have the freedom to create unique and branded experiences. Wallet fragmentation, combined with interoperability, can foster innovation and user empowerment in the crypto space.
User control and the importance of an escape path
The podcast episode discusses the importance of user control and the necessity of providing an escape path for users in decentralized systems. It highlights the need for developers to own up to their mistakes, learn from them, and ensure that users have the freedom to disagree and leave the platform if they choose. An example is given of how an export button in a profile allowed users to recover their funds in case they made a mistake. The podcast emphasizes that while flawed, providing an escape hatch is crucial in empowering users and preventing lock-ins.
Balancing user education and usability in crypto apps
The podcast explores the challenge of educating users on cryptographic concepts such as private keys and ensuring user retention in the crypto ecosystem. It raises the question of whether users should be expected to learn about cryptographic primitives or if it's possible to build abstractions that make these concepts seamless. The importance of user education is acknowledged, but the balance between educating users and providing a user-friendly experience is highlighted. The podcast also discusses the role of previous role in user education, proposing the idea of building user education pages to guide users through the process of transferring their assets between different apps while making them aware of the implications and interrelations between their accounts.
In this episode, we chat with Henri Stern, the co-founder and CEO of Privy. We begin with Henri’s personal journey in Crypto, how it led him to build Privy, and how his vision for Privy has changed over time.
We then get into Privy’s product mindset, how the primitives it enables benefit both users and developers, and where the product goes from here.
We also explore the current wallet landscape and how Privy fits in, what their forward-looking vision for embedded wallets is, the tradeoffs that must be taken into account when building embedded wallets and the ones Privy is optimizing for, as well as how Henri thinks the end state market structure for wallets will shape up.
Get the Snipd podcast app
Unlock the knowledge in podcasts with the podcast player of the future.
AI-powered podcast player
Listen to all your favourite podcasts with AI-powered features
Discover highlights
Listen to the best highlights from the podcasts you love and dive into the full episode
Save any moment
Hear something you like? Tap your headphones to save it with AI-generated key takeaways
Share & Export
Send highlights to Twitter, WhatsApp or export them to Notion, Readwise & more
AI-powered podcast player
Listen to all your favourite podcasts with AI-powered features
Discover highlights
Listen to the best highlights from the podcasts you love and dive into the full episode
