Onboard Once, Transact Everywhere
Crypto is the Network
Today, we’re sharing an important step in Capsule’s journey - Capsule embedded wallets are now usable anywhere onchain. I felt that, particularly amid the significance of this week for the broader crypto space, some reflection was warranted on where we’ve been and where we may go next.
Why Web3 Wins
Crypto's greatest strength and weakness is its position as a new type of storage for the internet. Why is that? Because while it’s hard for most users to get onchain, once they’re there, they can do anything. This past year, we’ve made a lot of progress getting people onchain, but very little has fundamentally changed.
Recently, everyone has been talking about embedded wallets – they represent a great step forward in crypto UX, and open up a variety of benefits to both platforms and users. Prior to this, requiring users to download a wallet to onboard has filtered out all but the most determined. Like most consumer breakthroughs throughout the history of application development, embedded wallets minimize friction and retain users within their existing experience.
However, with the rapid growth of the space and the resulting race to “get to parity with web2”, we seem to have forgotten— why did we ever have standalone wallets?
Interoperability, of course. App-specific wallets get users onchain, but at the expense of locking them into just one part of web3.
In web2, the imperative is to build a product, then quickly create flywheels that retain users within a network. The mandate is to create a product, which then creates a network.
In web3, we start with a network - the set of onchain, onboarded users. As we’ve seen, the best crypto-native consumer experiences - Uniswap, ENS, Aave (among others) - make themselves an indispensable part of many flywheels. Crypto is a network, and the most important apps occupy a place of prominence in the most important multi-app user journeys.
For any sort of crypto breakout to matter, this must continue to be true. Crypto’s unique advantage is that users can onboard once, then transact everywhere onchain. Why do the duplicative work of onboarding users fresh over and over again?
For far too long, we’ve positioned web2 and web3 as a dichotomy
“User Experience” vs “Interoperability”
“Abstraction” vs “Complexity”
“Trust” vs “Sovereignty”
These are all false dichotomies. Further, this has pushed us to erase the benefits of web3 in an effort to make experiences feel comfortable. If all we do is recreate a worse web2, what exactly has been accomplished?
Portable Wallets Are Live Today
Here’s a short video of what embedded, portable wallets can enable. A world where users can both easily onboard and be first-class citizens onchain.
We believe this is a step towards a space where builders don’t have to decide whether they are willing to compromise on the advantages of building onchain, and are instead equipped to build experiences that are only possible onchain.
With wallet portability:
Every app can integrate Capsule to create wallets (and login with them) – without skipping a beat or leaving the app
Users can leverage those wallets as they like across all apps in crypto.
Apps can build deeper, more meaningful relationships with their users as (yes, even embedded) wallets become richer sources of onchain history and identity.
If you’re interested in learning more about how Capsule can support your project, check out our website
It’s by far the most exciting time in the history of crypto to build in this space, and there’s no better time to be building at Capsule. If you’re excited to build the future of how we interact with blockchains, we’d love to meet you.
A big thank you to Jarrod Dicker, Aditi Sriram, Zach Herring, Gaby Goldberg, Maya Bakhai, Sam Hart, and Jacob Frantz for discussions and contributions to this post.