In a year where cryptocurrency and NFT values plummeted, the crypto market suffered one of its biggest blows last month with the collapse of FTX, a crypto exchange previously seen as one of the more stable and reputable companies in the space. For crypto-skeptics, it raised even more questions about the long-term future of digital assets.
Ian Rogers, the former chief digital officer of LVMH and now head of experience at Ledger, a maker of hardware wallets for crypto-assets, is not among them.
“We are concerned that people have been defrauded and lost money. We are concerned that the market may cool down and it may take some time for people to come back in. Am I worried that we might not want digital assets in the long term?” Rogers said. “Not in the least.”
The company envisions a future where everything from a Soho House membership card to your passport will one day be a digital document secured and carried in a hardware wallet. In an effort to bring this vision to life, Ledger has teamed up with Tony Fadell, the former Apple designer and engineer credited with creating the iPod and co-creating the iPhone, on a new product Rogers and Fadell claim to have the potential to put digital assets in the pockets of ordinary consumers worldwide, much like the iPod did for digital music. Called Stax, it’s a hardware wallet slated for release in early 2023 and a bet that, despite this year’s events, crypto and digital assets can still be widely used with the right product.
“Tony saw an opportunity from his experience for something that was much more beautiful, much more desirable and also more mainstream” than Ledger’s previous devices, Rogers said.
To understand why Ledger sees Stax as a breakthrough for digital assets, it helps to understand how a crypto wallet works. Despite its name, it has no assets of its own. These are stored on the blockchain. It is essentially a private key for your blockchain address. But a wallet connected to the internet is vulnerable to hacking – a widespread problem in the crypto world – while one that is not is more secure but also harder to use.
Ledger’s hardware wallets try to offer the best of both options. They are a bit like USB drives that can store your private key and allow you to complete transactions in the device. According to Rogers, they are far more secure than a phone or computer for holding digital assets, and for that reason they will only become more important as more of our things go digital. In his view, the luxury industry will be affected by digital assets more than most, because as more of our lives take place online, our status symbols will also become increasingly digital. Ledger even collaborated with Fendi on a hardware wallet earlier this year.
What was missing from Ledger’s lineup, in Rogers and Fadell’s view, was hardware that could appeal to the average consumer—much like the iPod wasn’t the first mp3 player on the market, but was the one that sparked the boom in digital music.
Where Ledger’s previous products tended to look like USB drives, Stax is a gadget about the size of a credit card with a wraparound e-ink display — so you can see what’s inside — and built-in magnets that make them easily stackable. In the hand it’s a bit like a mini hard drive with a satisfying weight, and the different displays the e-ink screen allows make the devices feel like trading cards if you have more than one. Ledger sees it as the basis for an ecosystem of products, again like the iPod, which was not an overnight success.
Fadell came up with the design after surveying all the hardware wallets on the market and found that they were mostly plain black devices that didn’t communicate anything about the assets they held, which was a problem. Ledger has found that many customers buy multiple wallets to store different types of assets, for example keeping most of their cryptocurrency in one wallet, while using another for collectable NFTs. Fadell found a flexible e-ink display that enabled an always-on display without using a lot of power. From playing with his children’s Magna-Tiles building sets, he got the idea to use magnets to make them stack easily.
“You have to have a mix of the rational and the emotional,” he said, adding that it’s the combination that enables a connection with a large set of consumers.
Whether digital assets will follow the path of digital music remains to be seen. When Apple first announced the iPod, co-founder and then-CEO Steve Jobs introduced it by saying that music is a part of everyone’s life and always will be.
“This is not a speculative market,” he said.
However, financial speculation has been a driving force in the crypto and NFTs market. The trajectory of that market this year likely deterred many curious consumers from jumping in.
Fadell compared the current moment to the late 1990s and early 2000s, when the Dot-com bubble swelled and burst but ultimately gave rise to much of today’s internet and technology. In the midst of the current technology turmoil, Ledger hopes to be one of the companies that comes out stronger on the other side.