Unless We Fix User Experience and Accessibility, Real-World Crypto Use Cases Will Stagnate

For a long time, Web3 builders have primarily focused on developing the foundations of Web3 and its backend infrastructure. This was necessary to move its capabilities past a proof of concept to a working ecosystem with the tooling that could deliver results.

Now, we have seen the pendulum swing the other way. The industry is somewhat over-indexed on infrastructure and under-indexed on high-quality real-world applications for a significant number of everyday users. But what does high quality mean in the context of Web3?

Simply put, these would be Web3 dapps that legitimately offer better products over their legacy Web2 equivalents. But two key barriers stand in the way – bad user experience and poor accessibility.

From the outset, Web3 users are required to understand technical concepts to navigate complex interfaces. While we are seeing improvements, such as account abstraction to simplify interactions with blockchains, regulatory uncertainty, security concerns, and limited use cases continue to stifle adoption.

Back to Basics: Blockchain’s Promise of Democratised Finance

This brings us to the next mission at hand — utilising the critical infrastructure built to date to make Web3 usable for a wider audience. And how do we do this? Blockchain’s founding principles of ownership and democratised finance are useful guides.

This starts with empowering users and giving them agency through self-sovereignty. And for self-sovereignty to have the biggest impact, the answer unequivocally falls to the largest use case – payments, a process that anyone participating in the global economy has to be a part of.

However, there are many inefficiencies in the existing payments landscape, as it operates in what is a fragmented network. While blockchain has entered the space to tackle some of these inefficiencies, it runs into the same Web3 problems of accessibility and user experience.

Making Decentralised Payments Fit for Purpose

The shift from infrastructure to application translates to a closer integration of traditional and crypto payment rails, promoting and enticing the broader adoption of decentralised payments.

Up until now, Web3 payment alternatives have struggled to deliver convenience and good user experience. These are key barriers to the mainstream adoption of decentralised finance in the everyday setting. In parallel, local banks and fintechs have offered siloed, bundled solutions forcing global citizens to rely on local providers for each region.

This can be particularly problematic in countries such as Argentina and Ecuador. In 2023, the Argentinian Peso lost nearly 78 per cent of its value. Inflation spiked at 200% at the beginning of this year and saw a subsequent stablecoin usage dominance in the region.

Meanwhile, Ecuador faced a country-level liquidity shortage late last year. Here, the demand for alternative ways to pay is on the rise as central banks battle economic turmoil and hyperinflation due to precarious governments and economic circumstances.

Ultimately, we need a borderless platform between fintechs and Web3 to make global payments simpler.

This involves removing the middlemen from the equation and placing ownership and the right to manage funds back on the individual.

In Web3, this ownership can come in the form of a self-custodial wallet. This removes the aforementioned barriers currently in place and merges the two worlds of TradFi and DeFi, while aligning to the founding ethos of blockchain – true decentralisation.

Driving Ownership in Web3

At the crux of decentralisation lies ownership. People need the DeFi approach to ownership, or ‘self-custody’ over their keys and assets, while having the convenience of TradFi in place to remove the complex, time-consuming set-up requirements.

Previous security concerns around lost keys have also been addressed by recent innovations aimed at easing private key management. Take for example Safe’s partnership with Sygnum Bank and Coincover to launch crypto recovery services. Such advancements not only instill confidence in Web3 novices to take the leap, they also promote greater accessibility of crypto to the masses.

The goal is to bridge the gap between blockchain’s technical potential and everyday users’ practical needs, making decentralized financial tools accessible and usable for all.

The answer is to work towards the seamless interoperability and composability between fintechs and Web3. This will combine payment accounts and Web3 wallets, bringing the best of both worlds together to shape the future of the global spending account.

About the Author

Article authored by Dr. Friederike Ernst, Gnosis Co-Founder