How Ledger Stax Plans to Make Self-Custody More Mainstream

Ledger Stack has begun shipping to customers who pre-ordered. The new wallet design was created in collaboration with the builder of the ipod and hopes to bring clarity and confidence to securing digital value. Joining me now to discuss and unpack what's going on here is Ledger Chief experience Officer Ian Rogers. Hey, Ian. Hi, how are you? Thanks for having me. I'm great. Welcome to the show and I am actually very excited to talk to you because I remember when this product was announced, I think it was 18 months ago and it was really exciting. We spoke about it on a show that used to air on coin desk called the hash. We were all very pumped about it. 18 months later, it is shipping to customers for pre-ordered, talk to me about what happened, what what happened those last 18 months? Sure. Yeah, we so we did, we announced the product in December of 22 with the plan to ship it in March of 23. Uh We did pre orders, we stopped pre orders relatively early because we, we were, you know, we didn't know how many we would have when. Um and really the supplier of the screen had believed that it would be available and they were wrong. Um You know, so we made a little mini documentary to, to tell the full story um with, with many of the suppliers and the, the CEO of, of E inc you know, talking about it. But the, you know, this is AAA new technology. So this is the world's first um organic TFT. So it is a curved display. In this case, it's an E ink display where the um the screen actually goes all the way around the edge and curves 100 and 80 degrees to the to the back on uh on a on a three millimeter um uh radius. Um and that had never been done before. And what it is where most, you know, your kindle is um silicon on glass. This is an organic substrate on, on plastic. So the screen is a is, is actually, you know, plastic where your um your kindle screen would be glass. This technology has been around for 25 plus years in terms of, you know, being scientifically doable, but it's never been brought to mass production. Um So, you know, when we announced this in December of 2022 we had the devices in hand. The supplier was saying no problem. We're gonna, we're gonna have you in market by March. It's ramping up, it's going well that, that turned out to not be true. Um There were problems in the mass production process. So even though we could make them, they couldn't make them at scale and at a reasonable cost. Um, so that's what we've been, been going through for the last, you know, 18 months and, and actually, you know, more like 12 months because for the last three months we have been, um, in mass production and we've been, we started shipping them to, to customers now three weeks ago and, and we'll finish our, our pre orders by summer and get them back on sale by um by late summer. Talk to me a little bit more about the technology. I know um in the announcement, also in the documentary, it said that this is the first secure touchscreen. What does that mean? Well, so the, the screen itself is powered by the secure element chip. So to be secure uh from a, from a digital ownership perspective um with a, with a, with a, with a wallet and the, and the wallet can do you know Cryptocurrency, but it can also do things like your pass keys for passwords and those sorts of things. You have to have your um your your secret um your private key stored in the secure element. It needs to stay there when the transactions happen. So the transactions need to happen inside that secure chip and you need to approve transactions on your secure display. That's what it means to be secure. Um You know, so there are other devices on the market which either, you know, don't have a secure element at all or they don't do the transaction in the secure element or they don't have a secure screen. So ledger is the only device that checks all three of those boxes. But that also means that we need to power this screen with, you know, roughly the same chip that's in your credit card. So you have a chip that was designed for um for security, not for performance. And you're, you're actually powering the screen with that. And E INC is a help to do that actually, because since you only have 16 colors, you know, it's, it's you need less to power the screen than you would. Um you know, with a, with a, with a different screen. So this, this is, you know, the world's first secure touchscreen, which for approving Cryptocurrency transactions is not only important, it's a must. We've always had that in the Ledger Nano products. Um Again, many competing products don't have that at all. Um And you know, doing that with a touchscreen is what's never been done before. Tell me a little bit about the future. You imagine there's this massive redesign really on the Ledger wallet in this product. What do you hope this unlocks in terms of user experience, user acquisition and building towards the future that Ledger imagines? Well, what we're trying to do our mission as a company is to bring ease of use without ever compromising on security or self custody. Um So the question is, how do we bring more people to self custody? You know, if you look at, you know, depending on whose study you you want to refer to, you know, people somewhere on the order of half a billion people own digital assets. But there are probably, you know, tens of millions of people in self custody and probably 10 million people or fewer in secure self custody, right? So our goal is to, is to bring that that number much higher. Um you know, I think, you know, we, we believe that, you know, digital assets will be a big part of the lives of future humans. And we think if that's true, then self custody and ownership is incredibly important, which means sovereignty for the, the user. And if that's the case, then security is paramount, you can't compromise on security at all. So our, our question, we ask ourselves every day is how can we improve the ease of use in that? Because, you know, the the wallets and self custody has been either difficult or scary and, and not only to kind of buy and hold, but also people want to do more and more with their digital assets, you know, they want, they want to use them um every day or they, whether you know, whether it's trading or it's identity or there are, you know, we're all pushing toward more use cases of, of scarce digital assets brought to us by blockchains. But if, if that's the case part of that is being able to, um, you know, not only own my value but also be the person who can use my value and do it easily and securely. So that's, that's what, that's what we, that's what we are pushing for and that's what we hope with, with these devices and really everything that we do, if you look at everything that Ledger has done, um you know, since, since the last cycle, we have been building very hard. Um you know, through the bear market. I think if you watch our little mini documentary, the 20 minutes that it shows, you know how hard we have been building, but that's only part of the picture because we've also been pushing forward our software road map, you know, we have, we have all kinds of software services um in Ledger, buy, sell swap, um you know, stake uh or credit card, et cetera, which are all about trying to bring the usage of digital assets into people's lives. And also Ledger recover is about bringing more people into self custody with a, with a very simple interface, right? And uh and a simple and you know, less scary interface than, you know, writing down 24 words. And then, uh and then, you know, stressing over, you know, where you put them, what do you think needs to happen to make self custody more mainstream. And I ask this because you brought up a good point. People are scared of self custody, right? And it's because of how we live our lives in the world. If we lose our money on our credit cards, we know that there's an insurance there, we're going to get that money back and self custody is not that you do have to take ownership of your own assets. Talk to me about what you think is going to change the mindset of people, bring them more into self custody, especially when products like the spot. Bitcoin and E ETF S are being approved. Um, exchanges are becoming more, um, there's more regulatory clarity that are allowing exchanges to operate uh, in different jurisdictions. What do you think it's gonna take to make people want to do this? It's a, it's a, it's a great question and I think for us, we believe that the world is heterogeneous. You know, you have custody and you have secure self custody for me. The dangerous part is everything in the middle, right? I think, you know, let's, let's ask ourselves who are the custodians that we trust and you know, and, and you know, exactly who are they and, and how, and why do we trust them and, and their security? You know, there were many people that trusted FTX in the last cycle and not only their custody on their side, but also their security. Well, it turns out to have been a joke, right? But many, but many people um, did trust them in the last cycle. Also every cycle, you have people that, um will are willing to compromise on security, self custody or both. And, and they usually use the phrase on boarding the masses as part of their justification for compromising on either security or self custody or both. And we see the ruin that leads to in, in every cycle. So to me, there's, there's only two options, you either have a very trusted custodian. And I think we have very few of those on planet earth today where, you know, we could kind of agree as an industry that, that, you know, there's a lot of trust behind that custodian or you have secure self custody. So all of this stuff in the middle. So whether that's uh an untrusted custodian or a slightly trusted custodian or a software wallet or a wallet that doesn't meet the three requirements that I, that I laid out earlier. You know, those are the things that are really to be avoided. So, um, but I do think that the future will be, you know, heterogeneous. And so what we have to do is I think we have to improve the the user experience. And I think that sta sta is a um a big step in that direction, you know, simply having a touch screen, um, brings self custody to an entirely different group of people. Um you know, I think about, you know, my mom and, and you know what, she really wanna click two buttons with, you know, her, her two thumbs to say, OK, that's not a familiar um you know, user interface for her. So I think simply having um you know, a AAA touch screen with a, with a, a big clear U I where you can see transactions. I also think things like clear signing, which we're working on now. So there's a lot of, if you're using your Ledger every day, you're probably blind signing a lot of the time. And, and that's, you know, that, that actually in some ways defeats the purpose of, of the security that you have on your device. I mean, if your device is secure, but you're effectively signing a blank check. You're just, you know, pushing the, the lack of security to a different, a different place in um in the stack. So I think we need things like clear signing. I think we think need things like Ledger recover which, you know, bring self custody and a bit of peace of mind. You know, with Ledger recover, if your seed is recovered to someone who isn't you coin cover, who is our partner and provides, you know, up to $50,000 of coverage, which for many users is a, is a great um you know, bit of insurance on their um on, on or assurance on their, on their self custody. Um And, and then we have more, this is exactly what we're focused on every day is how can we make, you know, how can we keep self custody secure and not compromise on security and then through improvements in the user interf interface. Um And then just the overall user experience, you know, from, from buying your first crypto um to whatever you want to do with it today, um making it really easy to use. I know if you, if you, if I could, I'd like to give one more analogy which is, you know, I did digital music for 20 years and um I remember uh the, the MP3 players before the ipod, I worked on, on, on Winamp and there was an MP3 community before the ipod. Um We felt like we were a pretty big group in those days, although in retrospect, I guess we were pretty early and small, much like what we feel in, in crypto today. Um And, and there, there were mp3 players before the ipod. Most of them have been forgotten about at this point. Um But they, they did exist and so, but something changed with the ipod where if you had an MP3 player, like a hard piece of hardware that played MP threes. Um Before the ipod, it went like this, you had MP threes, you were an enthusiast and then there was a little device and you're like, oh That's cool. Let me get that and I'll put my MP Threes on that with the ipod. It was the first time that someone said, look, I, I'm not in this world yet. I don't have digital music yet. I've got a disc, man and compact discs, but I see this digital music thing and I see that my friends have it and I'd like to be in that world. So I'm gonna buy the ipod and then I'm gonna rip my C DS or buy, you know, songs from the itunes store. So you really turned it around and I think that Stax has exactly that, that same potential. I think it's almost like a, like a cool factor. I think it's also just a comfort factor, right? I mean, it's an, it's an ease of use factor, right? It's something where you can imagine someone who is crypto curious but doesn't yet own any crypto having friends who, you know, have, have kind of given them the confidence to say I want to jump into this pool with you and they're at Best buy and they can make a purchase and they can go home and buy their first Bitcoin and they can from day one be in secure self custody. Whereas the path to Ledger today is generally buying some crypto on an exchange. You know, you, you watch your value, you become more educated, you become, you know, more interested in, in security and self custody. And then you find yourself with Ledger. But also I think the other thing that will happen is the use cases will explode. So the use case for Ledger used to be, you buy some Bitcoin, you put the Bitcoin in the Ledger and you put it in your closet. But now many of us are using our Ledger every day. You know, my ledger is not only what I use if I'm going to, you know, if I'm going to mint or if I'm going to swap, it's also my um security key for um pass keys and two fa so, you know, instead of using um Google authenticator or another security device, um you know, my, my ledger is something I carry around with me every day. Not because it has, you know, tons of crypto on it, but because, you know, it, it, it's how I log in from a two fa perspective and it's much more secure than doing that same two fa it's actually both easier and secure than doing it with say Google authenticator or, you know, pass keys on an iphone. Um So I think that, you know, those use cases explode both within crypto, you know, where we're using it. Um for, you know, our, our social media accounts with things like XMTP or lens um or forecaster, but also beyond and into other, um you know, other other parts of our lives. Uh where, where we, where we need more security than cell phones are able to provide and there's no path to cell phones um becoming, becoming more secure in the immediate future. I I got to ask you about the price. I believe it cost just over $300. You can correct me if I'm wrong. I know that it is new technology. It takes a long time to make you kind of took us through the journey. And so that's an expensive process, any plans to try and drive that price down so that it is actually more accessible to the people that we're talking about. It's a great question. So, you know, right now, we have the NANO S plus which is an $80 product. And we have the NANO X which is 100 and $50 product. So um you can get and, and really the security of those devices is from a security perspective equivalent, right? So from a, from a user experience perspective, not the same, from a security perspective, it's excellent security on, on those devices. Um When we preorder this product, it was 2289. And now because the screen has been difficult to make and more expensive to make than we had anticipated the price that that original um supplier of the screen told us um is not the price that I'm able to buy them out today. Um The the device will be more expensive when we put it back on sale later in the summer. Um and we have um some other plans for making ease of use um accessible to everyone. It's an incredibly uh important topic and that's we have more news coming later on that. How much is it going to be when it goes on sale in? We haven't said yet but the preorder, but the preorder has got a great deal. Amazing. Well, Ian, thank you for joining the show. I look forward to seeing some of the products IRL and uh congratulations on the launch. Thank you so much. Thank you for taking the time.