 My name is Sid, I'm the product leader at Coinbase Wallet, and today I want to talk to you guys about DApps, and specifically what does DApp adoption look like, and what can we do to get to where we are today, and to a new world where there's millions of users using DApps. So let's just kick off with DApps, like decentralized apps, like here we are at the biggest developer conference for what might be the most promising smart contract platform in history. And we all think that, I think we all believe that DApps are the future of how consumers will experience crypto, right? It's a packaged product where people can go and do something that's based on crypto. And so we all share this excitement, right? If you look at this chart, I think some of you may have seen this before, but the numbers and the adoption has been staggering. The shun amount of building that's been happening, right? We're almost 20,000 ETH related GitHub repos, and that's amazing. That kind of adoption curve does not happen very often. And it's the same story with DApps, right? We've steadily seen the number of DApps increasing quarter on quarter, just been like steady growth. And from all of our conversations in the ecosystem, it's clear that this base is not going to, is only going to improve from here. And this tons more DApps in the pipeline that are about to get launched. But when you look at actual adoption and traction, right? Like the number of users using crypto, that hasn't really taken off. And so, you know, that's 13,000 users is about what you would get from like a second tier app in the app store, right? It's not across the entire ecosystem. And it's the same story with ETH transaction volumes, right? Like daily DApp volumes are tiny. And so what's going on, right? This is not good at all. Like what's happening? Like on the one hand you have an amazing amount of innovation, creativity, building, happening, this worldwide movement, but users aren't biting. And so what's going wrong? What can we do better and to get out of this situation? So before we dig in there though, like why do I care, right? Like what's the story? And I've been spending the last year working on this product Coinbase Wallet. Some of you may know it as Toshi. And for those who don't know it, it's an app in the app store and the Play Store. It's available to anyone to download. And we are a user-controlled crypto wallet. We support all the Ethereum digital assets. So ERC-20 tokens, ERC-721 collectibles. We're also a DApp browser. And so we create a bunch of DApps and we support any Web3.js-based DApp. And so it's a really easy form factor and popular around the world to be able to use DApps on mobile. We were the first mobile DApp browser. We featured CryptoKitties back when they launched in December. We were also the first popular wallet to support collectibles. And so obviously CryptoKitties was the first and there's been hundreds more to come after that. And at this point we feature around 87 DApps. And it's really a cross-section of everything that's happening in the ecosystem. So there's all the financial services. You have decentralized exchanges. You have investment platforms, borrowing platforms. Then you have all of the games and collectibles, all of that entire kind of subspace. Then you have decentralized social media, decentralized marketplaces, and even jobs platforms where you can do stuff and earn in crypto. So pretty, quite a lot of activity going on. And we try and curate the best DApps and present them to our users so that they can find them easier, find what's hot, what's popular, what's useful. And then also we have some guardrails. So if you're new to crypto, we explain what DApps are, what ethers. So really the target audience is people that are relatively new and relatively inexperienced in crypto. So why did we even build Coinbase Wallet? I think the idea for us has been that you probably know Coinbase because of our first products, the brokerage and the exchange, and those were successful in onboarding millions of users into the investment phase of cryptocurrency. And the investment phase is really people buying crypto because it appreciates in value. But I think what we're all excited about, most excited about is the actual utility phase where people start to use crypto. And that's where Coinbase Wallet comes in, and it's the first of several products that we've launched in this space. And so we present this product to Coinbase users as being the gateway to the decentralized web where you can access all of these DApps. And so over the last year, we've just had this opportunity to engage with all the developers in the space, get to know all of you guys, get to know what you're building, try and create a platform to make DApps successful, and give them a stage to all of our users. And we also have the full spectrum of users, right? We have some very early adopters, and then we have like complete crypto nerds like a lot of us in the audience. And that gives us the kind of feedback which is much more kind of a lot more granular and like reactions of what people feel like when they first experience crypto. And so reflecting on all of these kind of exchanges, both with developers and people building DApps, as well as early adopters and users of crypto, right? We've come up with a list of the three things that we think are the most important, kind of hurdles to adoption. And so what's holding back DApp adoption is basically the first is use case, right? And I think it's the most fundamental problem that we have is like, what problem are these products and these DApps actually solving? The second is assuming that they're solving a good problem, how usable are the products? And the third is, are these products actually able to support many millions of users at scale? And so this is roughly ordered in what we think is the importance, right? First, you have to be solving an important problem. Second is, of course, then comes usability and then comes scalability. So let's tackle number one. So we were given, when ETH was created, right? We were given this amazing tool, right? A Turing complete programming language operating on top of a decentralized, borderless, trustless platform, right? Just something that we never had before. And for the first time, we had the concept of digitally native programmable value. And I think all of us agree that this building block is as powerful as the internet was when it first came along 30 years ago, right? Incredibly powerful, lots of promise. And what have we built with it so far? Well, mostly digital cats, right? And so, and I'm being facetious, obviously, because I just showed you like a bunch of different DApp solving, a bunch of different use cases. But really, when I go outside of our crypto community and I talk to people and they're like, hey, what's the most popular DApp in? And it's hard to keep a straight face when you have to tell them, well, it's been these digital cats that you can buy. And so the problem is that no one has yet built DApps that really solve user problems that people feel a lot of pain around. And so there isn't a DApp out there where people wake up every morning and there's hundreds of thousands of people that say, I really need this DApp. I need to use it, right? If the DApp didn't exist, that it would leave a vacuum in their lives. And so that's a bit of a hurdle, but maybe that's okay for the first generation, right? So we're increasingly seeing the first generation of DApps as being kind of primitives. These were, we were given a new technology a few years ago and we built proofs of concept, right? These are the things that you can do when you're given a smart contract platform, right? You can create fungible tokens. You can create non-fungible tokens. You can create identity on the blockchain. You can write smart contracts that enable trustless transfer. You can enable, you can create smart contracts that allow you to deposit assets and then withdraw them, withdraw collateral against those, those assets that you've deposited. You can create stable, stable coins. You can create state channels. So these are all proofs of concept of the things that we can do. But I think what needs to happen next is the next generation of DApps. And so, you know, Sam Altman of YCE once said, right? Like, make something that people want. And this has now become something of a mantra for, like, the startup factory that's YCE. And it is because this idea works, right? The next set of DApps, we need to change our mindset from developers that are kind of exploring and playing with this technology to entrepreneurs that are trying to build businesses and solve real problems. And the good news is that there's a playbook for this, right? There's an established playbook for this. You find problems that people really need to solve. You build a product around it. You talk to your users nonstop and iterate and improve the product. You figure out how you're measuring traction and hold yourself accountable to that. And then you have a strategic plan for how you're going to grow that business. And these are what we feel needs to happen next. So the next DApps will answer these questions, right? So what problems are we solving for users? What about crypto uniquely enables us to solve these problems for the first time that we couldn't solve before? And then, are these products that we're building, are they going to be 10 times better than anything else that exists today? And another thing to keep in mind is that we may find that we actually have to leave our comfort zones. And so traditionally, when you build a tech product, the early adopters were in Silicon Valley and it radiated out from there. But maybe where we need to go is kind of outside of this and go to places where people aren't being served by today's financial system. And so that's not normal, but maybe that's the new normal. That's where we have to go to find users and find adoption. Next, if you're trying to pitch your app, try and do it without using the word crypto or blockchain. It's not easy, right? Because for a lot of us, what's cool about our app is that it's using crypto or blockchain. But normal people don't really care about this. So this is another challenge when you go out and try and build a product for people. And you've got to keep in mind that game changing innovations, they eventually rule and they eventually take over, but it takes time. So obviously, when the motor car was first created, it took, I think, 23 years for us to actually embrace it and move away from horse-drawn buggies. And similarly, when the internet was first created, 30 years ago, there was this whole generation of entrepreneurs that immediately kind of thought of all of the new ideas that were going to come. They thought of everything that you could possibly do with the internet. And they built the first prototypes and they raised a lot of money and we saw the dot-com boom. And most of them ended up crashing because it was right idea, wrong time, just too early. And some, of course, survived. And so some of the biggest companies of today, Amazon and Google, started then and survived. So what we have to keep in mind is, when you look at the DAPS space today, there's a lot of that too. We have a lot of ideas that are amazing, really game-changing ideas. But is it too early for some of them? Probably. And so we have to figure out what are the ideas that will actually get traction in today's market. And so that's about finding the right use case and finding the right problems to solve. When we look at the DAPS that we have today, there are some teams that are super strong. We've even invested in some of them at Coinbase Ventures. They have strong entrepreneurial teams. They're talking to users, trying to solve real problems, trying to fix scalability issues. But when we talk to them, they say that the number one issue that they're having is actually usability. And so that's, I think, the next thing that we want to talk about is, what's the state of usability and how can we help improve that? So I think we all agree that the state of DAPS today and using DAPS today is pretty awful, right? So just to get started, you have to first install a wallet app or a browser extension. Then you have to write down this 12-word recovery phrase, which people completely, it's a new concept for most people and it's a complete pain in the ass. Then you've got to go to crypto to fiat exchange or fiat to crypto exchange and buy crypto. Then you've got to copy and paste your wallet address over to the exchange and send the money across. Then you wait for five or 10 minutes. The money shows up. You've got to click off your transaction. You see gas prices and you're like, if you're new, you're like, what the hell is a gas price? Then you come to terms with that. You enter the transaction, wait a few more minutes. The UI updates and finally it's like mission accomplished. And that's pretty painful. And I think most of us here in the room today, we have this dream that we want to replace. We have this new technology that can build an open financial system and we want to replace like the entrenched interests of Wall Street, right? But here's the problem. The user experience today, because of Fintech, the user experience on traditional finance has become really, really good. And so there's, and both the user experience and the distribution. So there's a billion people around the world that have visas and master cards and they can make electronic payments anywhere at any time. With Stripe, developers can start to accept crypto payments with just a couple of lines of code in 60 seconds. I can send money to my family in India with Transferwise, basically overnight for like maybe 10 bucks, right? Apps like Venmo, Alipay, WeChat, you can send money like sending a text message. Google Pay, Apple Pay, make it really easy to just check out. And so whether we like it or not, we're trying to replace a system that has set a really high bar for usability. And that's a lesson we learned at Coinbase pretty early. If you look at our website five years ago, you look at our website today, the pitch remains the same. We're like, if you want to buy crypto, we are the easiest place to do it, the easiest and the most trustworthy place to do it. And that worked really well for us, right? There were dozens of other exchanges back then, there are dozens of exchanges now. And they're all offering the same basic thing of buying crypto, but we were able to differentiate ourselves by creating a good user experience. And so that's something which, you know, we're now trying to bring to Coinbase wallet. And we're trying to bring that same ethos. And over the next few months, what you're gonna see is, we're gonna try and make it really easy to fund your wallet. We're gonna try and make it easier to use recovery phrases and manage that and actually not have to manage it at all if you can avoid it. We're trying to break the boundaries of the DAP browser. So we don't want you to have to only open a DAP browser and use DAPs. We want you to be able to use them anywhere. We want you to be able to send to friends and not to like 40 digit addresses. We want you to be able to discover DAPs more easily. And finally, we want to also enable commerce. We want it to be really frictionless to be able to go and buy stuff on the internet with crypto. So our goal is, I showed you this chart before, our goal is to drastically reduce the friction involved with onboarding. We know that when DAPs builders create DAPs, they do a lot of work to get people onto their DAP and then they have to hand their customer off to a wallet. We take that responsibility pretty seriously and so we're trying to fix the experience. And if you're a DAP builder, there's basically a design revolution that's been happening over the last six to 12 months and there's a ton of designers that have entered the space. They're sharing their knowledge and really they're helping us see whether we're a wallet builder or a DAP builder. They're helping us see the space from just a different lens from the lens of a beginner and we're all crypto nerds and we're so immersed in the mark of the technicalities but with good design, we can really try and fix that. So if you don't already follow these people, you should, they're all awesome and they're bringing a ton of fresh thought and energy into the space. Last option, scalability, last hurdle to adoption. Now let's assume that you found a good problem to solve. You're an entrepreneur, you've decided you found a good problem to solve, you've built a really good app around it, you've used good design principles, you've tested with your users and you're now an overnight success, right? You've cracked it, you've got like tens of thousands of users, you're like, okay, we've made it with the next crypto kitties and then immediately this happens, right? And we know this will happen because it happened a few months ago, right? Or it happened last year. Immediately the network transaction load will spike, fees will blow up, the network will crash and your app goes to hell, right? And we talked to a lot of people outside of crypto that are looking in and these could be game developers from big game studios, they could be fintech entrepreneurs that have had a success in traditional finance and are trying to launch something in crypto. And their feedback is always like, Sid, if you tell me that my upper limit of users is like 50 or 60,000 if I build on crypto, that's not worth it for me, it's a deal breaker, I can't do it. And so we, I think that's a really fair point, right? And so how do we fix the problem, right? And so I'm not gonna go into the details of this, there's enough talks you just heard from Amin and Arjun, but the options basically come down to this. We either go with core scaling, right? And serenity is expected to show up, but then it's not showing up for at least a year or two. And so that's a long while to wait, although it'll be a game changer. Or if it makes sense for your app, if you're building a payments app or something that's between two parties, state channels is a great approach, right? State channels and payment channels. And so there's a few great projects there that you can experiment with, but it's very early stage. You just, once again, you just heard from Amin about the hack. We're still, you know, this is what happens when we're learning, right? Like you get hacked because you're learning, we're still putting things together. So it's too early to put any of these into real production. And then if it makes sense for your app, there's also side chains. So there's a bunch of side chains projects that you can look at a different approach and make sense if you need visibility to what's going on. And so that's another thing to consider. So quick recap of what we covered. Most important thing you can do if you're building a app. Solve a real problem, talk to users, figure out what is an actual pain point and what, like we've come up with what we can build. Now we need to figure out what we should build. Second is let's create a great usability and great experience around it. And third, let's start experiment with these scalability options. And I'm pretty convinced that if we tackle all three of these, we're gonna see some breakout successes in 2019 and I'm pretty stoked to see that. So next stop, Moon. Thank you. Thanks. Questions specifically for mobile. Probably many people are aware that you had some trouble with Apple because they want their 30% cut in the app store and this model has worked really well until crypto hit. So just wondering if you had some thoughts on how you think to avoid issues where Apple wants a cut or maybe Google in the future or Amazon or whoever. Cause it is a payment in their ecosystem at least from their perspective, right? Yeah, I think it's a little bit early days I think when before we begin to actually start to compete with these products, with these giants. And so I think we're just gonna have to see how that plays out. I think the equation will develop over time and relationships will develop over time. I honestly don't have an easy answer to how the community will navigate it and how the incumbents will navigate it. It's just not clear at this point. Thanks. Not totally related, but still, I think also UX. What do you think about gas relayers? Cause in your 12 steps, there's still this gas, what the fuck is gas? And there's this new interesting concept that somebody else could pay gas for the user so that they at least initially don't have to deal with it. Do you have any thoughts on that? Yeah, absolutely. We love the idea of gas relayers of meta transactions. Frankly, anything that reduces the user burden and makes these transactions just disappear into the background. It's a little bit early. I think they're basically being prototyped as we speak. And so that's definitely something we're also looking at, how to engage with it, how to start to deploy those. But yeah, it's a little bit early. Hey, I was curious about, you were also building a in-web widget as well, right? What's the background on that right now? Sure, so we had announced doing that and then we had a bit of a rethink and we were like, well, what is, if we actually want dApps to be available everywhere, do we just try and be on one more platform, which is in web browsers, or do we try and be on every platform? So we're actively trying to figure out what our place should be for web and hopefully we should have some announcements in the next month or two. Also for gas, have you thought about maybe changing the name of gas fee to just fee? Because it seems like from the last talk that people don't really care about paying gas fees, but if we just change the language to just fees, would that help? You know, I think it's an open question. It's something worth testing. I think one of the issues is that when you're talking to a new user, when you tell them there's a fee, they usually assume that you're taking the fee. We're not taking the fee, right? Like wallets don't take the fee. And so I think if you make it clear that it's a gas fee and you try the concept back to what's going on on the blockchain and the miners, that's something we've tried to use helpful language inside the app. But I think there's the danger that if you just say the word fee, that people are going to assume that it's our fee and be like, oh, you're charging too much. Well, we're not, right? So, yeah. Oh, so people have, for example, now gone free for peeps. Is that a problem? Because you kind of don't want users to suddenly go back into that mindset of, well, look, someone else is dealing with paying for all of this stuff. Isn't it? And we're sacrificing that obviously for convenience. Is that the wrong sacrifice to make? You want users to actually have a sense of control over what they're doing and remind them in a kind of educative way. It's you who's in control. Yeah, that's a great question. I don't know if necessarily making people pay money is the best way to illustrate that they're in control, but I get your point about the incentive system. If someone else is paying for you and if they say, if the product is free, then you are the product, right? And so there's a danger of that. I think there's going to be three or four different kinds of like business models that appear over crypto, right? You could see that one state channels appear and payment channels appear. And are in production and reliable that you won't have the problem of fees anymore as much. And so maybe that problem goes away in the next six months. You mentioned a couple of times the reasons for success for apps to get mass adoption. What I'm wondering is, do you think that the same reasons apply automatically to dApps or where could there be differences between dApps and apps in very strategic terms to become successful? Sure, I think dApps and apps from a user perspective should be the same thing, right? They don't care about whether it's based on a decentralized technology, but it's really about can we leverage the fact that we have programmable value and that it has without borders, without permissions, can we create a really powerful product there where traditional financial applications, they have to KYCU, you have to be in a certain geography, you have to have permission to operate on their product. Crypto changes all of that. So can you create programs that make use of that, right? I think that's where you can actually create a product where even the user doesn't know they're using crypto. It's suddenly much more powerful because it's available to more people and because it's more efficient with value. So how much time do we have left? Maybe 30, does it say? Oh, we have a minute. Okay, very last question. First, thank you so much for emphasizing the need for use cases. We need to actually have things that people need. Web versus native and enterprise, what is your take on the priorities in those spaces? Sure, so I'll comment on web versus native and not the enterprise because frankly, I haven't paid any attention there, whereas web versus native, I've spent a lot of time thinking about that. We started off as a native, the incumbent was metamask, we started off as a native product. I think I reflect back on what's happened with the internet today, which is that half the activity on the internet for the long tail of activity is in web, but for any product that is successful, they eventually want to build their own native experience that controls the experience and because the native just is a richer format and a more powerful format for that. And so once again, we're actively trying to think about how can, at the same time, the problem with going completely native and creating native experiences in crypto is that if you created a wallet in each native experience, users would be completely fragmented where their identity would be fragmented across different native apps, their assets would be fragmented across different native apps. It would actually impede the value of crypto and if you actually had a different wallet in all of these different native apps. And so we've actively been grappling with, we already serve, our dApps are all on the web today. We want to serve native clients. We want to be a wallet for native products. And so we're coming up with a strategy and a product offering for that. You should see that in the next couple of months. Awesome, give it up one more time for Sid. Thank you, thanks everyone.