In the past few months, I have spoken with dozens of startup teams and I have found that some teams are not thinking about their users from first principles, are unclear about their users’ needs, make assumptions about what their users want, or make too many assumptions about user adoption.
Technological innovation is fascinating. But the ultimate audience of all this is the user. As Steve Jobs said: "You've got to start with the customer experience and work back toward the technology – not the other way around." Entrepreneurs need to think more about the user-centricity and learn the mindset of "work backwards".
It’s time to get serious about your users again, folks.
1. UI/UX
Source: Uniswap
Interfaces like Uniswap and Lido have become the de facto benchmark for Crypto. In terms of UI/UX design, it should be as simple and intuitive as possible, allowing users to easily understand and use it, reducing friction as much as possible, and making minimal assumptions about users.
1.1 UI
Websites are usually an important entry point for users to access a project. As a heavy product experiencer, I have two impressive crash moments:
When I open a website, the first thing I see are three or four entry buttons. When I intuitively click on these buttons, they take me to different pages, each of which contains a lot of information and complex design elements. I suddenly feel anxious. Where should I start?
The project does not provide any documentation. Documentation is a portal for many users to quickly learn about project information, and is a faster and more efficient way to learn about a project than white papers and blogs. Some "buzzwords" on the homepage do not help users fully understand a project except for providing slogan-like publicity.
1.2UX
I would like to use two examples to illustrate that at this stage, Crypto’s user experience requires more fine-grained optimization.
Mobile
I always think that the importance of mobile is being overlooked. Currently, most dapps lack a smooth mobile experience and can only be used through a browser (built-in to the wallet), and need to switch back and forth between the browser and the wallet. Imagine you are an avid memecoin trader, and you will feel anxious about your position when you can't guarantee that you are always in front of the computer, so a mobile Dexscreener will make you feel a lot more at ease.
By cooperating with Privy, friend.tech has taken a step towards a built-in wallet. But compared to the mobile version of CEX, DEX still has a long way to go in terms of user experience. For time-sensitive transactions (such as contract transactions), real-time notification push or price alerts are very useful. For social applications, the importance of sharing anytime, anywhere is even more important.
AI Agent
AI and LLM can be great for helping users understand a new project.
For example, when I visit a Layer2 Ecosystem page, I am usually confused. It shows common protocols such as Uniswap, Aave, a lot of wallets, tools, etc. I know these protocols, but I don’t know where to start. Imagine an Agent that can tell you what dapps everyone is playing on this Layer2 and what is the fastest growing protocol based on recent on-chain data. It can even analyze the behavior of each user address to provide targeted suggestions.
Things like this make me feel that Crypto still has a lot of room for improvement in UX. A few years ago, I would have thought that we didn't have a good enough Infra to support applications for mass adoption. Recently, we have a scalable underlying chain and an easy-to-integrate user onboarding process. Now it's time to spend more time on UX.
2. Stickness..Wat do?
Source:IOSG Ventures
In Crypto, it is relatively easy to get some short-term growth data - you can immediately launch a campaign and give away some kind of Genesis NFT to achieve short-term goals. This has in fact been considered as a hint that users have a certain expectation of potential benefits in the future. However, attracting real users and gaining their long-term adoption is a more difficult task, and there are almost no shortcuts on this road. (Uniswap spent nearly three years making a good product before the arrival of DeFi Summer)
It is worth noting that Warpcast currently accounts for 90% of the network activity, but there can be other clients that offer various unique propositions on top of this infrastructure. In addition, most people use it as a pure Web2 social media platform, as users have not yet been trained to take advantage of everything it has to offer. The important growth signal will be individuals using the Farcaster native solution to make their user experience most like the different features expected (decentralized social graph, framework, etc.), which may take time, as the graph itself is not mature or powerful enough in its early stages.
2.1 Acquisition, wait..it’s all about airdrop?
Source:IOSG Ventures
Although I don’t want to confuse airdrops with customer acquisition, airdrops have in fact become a shortcut to customer acquisition.
Generally speaking, airdrops are now seen as a means of acquiring customers, and airdropped tokens are seen as customer acquisition costs.
I think the important thing is to think about the purpose of the airdrop. What do you want to achieve with the airdrop and how do you manage expectations and develop strategies based on those goals?
In its recent airdrop, StarkNet awarded rewards to the contributors of the top 5,000 repos on GitHub. This is obviously intended to bring StarkNet and even Crypto into the vision of traditional developers. Other protocols have also proposed to distribute airdrops to family pledgers or teams developing public products.
Source:IOSG Ventures
I agree with what Regan said: “Community means making money with your internet friends”. We have to admit that many users use a pre-token protocol to get airdrops.
However, I have reservations about what Hayden said: “Don’t be stingy - give a significant amount away. If you don’t think the community deserves a significant amount, don’t release a token.” The “Community” in Hayden’s sentence and the “Community” in reality are actually not the same thing.
You know, in the airdrop season when witches are rampant, it is very difficult to distinguish between the real "Community" and "witches", the latter of which has become an industry. In order to solve this problem, the protocol needs to spend more time to identify real contributors for long-term development.
Airdrops have in fact become a bit toxic. Users often regard venture capital institutions and project owners as their absolute opposites. Project owners are in a dilemma in designing airdrop rules. Airdrop farmers account for a considerable part of the community. If they feel that they are not well rewarded, they may fud your project on CT. However, if witch screening is not performed, tokens are often not rewarded to real users, and there will be greater selling pressure on them. This is quite tricky for project owners.
Having said that, when you want to use airdrops to bootstrap, remember to never be vague, don’t deceive users, and make sure to convey clear information and rules.
My opinion is that if you are a long-term builder, then try to return things to organic. Don't do excessive marketing to give users unnecessary expectations, and focus on building good products.
In short, most projects conduct airdrops to attract users to use the product for a long time. This requires that you have a good enough product before releasing the airdrop expectation. If the user experience is bad, the airdrop may even have a counterproductive effect and leave a bad impression on users.
If you don’t have a clear airdrop goal and strategy, as well as a useful product, then focus on building, enjoy organic growth, and wait for better opportunities to come.
2.2Retention
Different types of projects often have different user retention strategies: for DeFi, it is liquidity; for NFT, it may be more about the community.
Source:jonwu.eth
Uniswap has accumulated indestructible liquidity and a strong brand over the past few years. When people want to swap a token, they often intuitively think of Uniswap first, and take it for granted that Uniswap will have the best liquidity and the lowest slippage, without having to go to DeFiLlama to find which pool has the best depth. The moat created by this brand effect based on people's intuition is quite solid.
In addition, the liquidity built by large funds is relatively stable, and large funds tend to act more slowly than small funds. Therefore, it is extremely difficult to rebuild liquidity unless you can provide a strong incentive mechanism.
Source:David Hoffman
For application projects that are directly oriented to end users, community may be the most important thing. Of course, the concept of community is difficult to be concretized. You can say that the essence of community is a kind of culture, symbol, or symbol, where a group of eccentric freaks gather together for fun things.
When we judge whether a founder is Crypto-native, we usually communicate with the founder about their understanding of the community. This understanding is the intuition and mindset gained from long-term, at least one or two years of accumulation in the community. For such projects, the founder needs to try to understand the community, feel the culture, and listen to what the users are saying.
3. Seeking Token-market-fit
Tokens reflect the market's consensus on projects to a certain extent. Take the above example, Arbitrum is the L2 with the largest TVL, and it is a consensus that it has strong cash flow; dogwifhat's hat consensus is also a consensus. What kind of token does the market want? What kind of token does the market buy in? I understand it from the perspective of utility and speculation.
Utility
Utility is also divided into several types:
One is the utility generated by the expectation of future returns. For example, you need to stake 32 ETH to become an Ethereum validator and earn about 4.5% APR.
One is similar to token-gated: you must hold a certain number of tokens or NFTs to be allowed to enter a community/or use a protocol.
The nature of some Infra projects determines that they cannot give tokens strong utility. For example, most L2 tokens currently only have governance utility or have a narratively "speculative" nature.
Speculation
Source:IOSG Ventures
Retail investors feel that this token has the potential to rise. Regardless of the reasons, direction, product, narrative, etc., the market will form a joint force to support the price of the token.
For users, narrative is often the most direct and easiest to understand. The problem faced by many Infra projects is that the concepts of the projects are too obscure and difficult to understand - it is difficult to expect every user to understand the principles of cryptography such as ZK, FHE, or things like developer tools, and the benefits they bring. But we can try to convey some simple information, such as abstracting these into a string of letters or phrases: ZK, FHE, Restaking, and so on.
Trace mentioned two good points in Unbundling Attention: "bigness" and "simplicity". For example, L1 is an enduring narrative in the Crypto world. It is large enough to accommodate a large number of dapps and users. For another example, memecoin is the simplest token. It has almost no learning curve. The only reason for users to buy it is the expectation of rising prices, so it can quickly occupy the user's mindshare.
I think another important point is how users perceive a project and how they interact with it. An intuitive example is that when users experience Solana, the most obvious feeling compared to Ethereum is that it is fast and cheap, so users think Solana is better than Ethereum. This is a fairly simple logic of thinking. I also observed that many EigenLayer restakers actually don’t know what AVS is, but because EigenLayer has a stake interface and interaction process, it will give them a familiar feeling and make them accept the narrative of Restaking more quickly.
4. Closing
More projects and tokens are being rapidly introduced to the market, and users need to face rapidly changing narratives and dazzling projects. In this playground where everything is accelerated, attention is a scarce resource.
Crypto has been developing for nearly a decade, and users don’t want just a good DEX like they did a few years ago. Today, it is more difficult to build a successful Crypto project than in previous years.
In any case, user-oriented is the ultimate goal. Put your focus back on users and think about user needs from the first principles. This is my sincere advice to all Crypto entrepreneurs.
