Stop Calling it a Wallet
Originally published on Mirror.
What’s in a name? That which we call a rose / By any other name would smell as sweet” — Juliet, about Romeo (Shakespeare)
According to the hypothesis of linguistic relativity, the way people think of the world is influenced directly by the language people use to talk about it. Language shapes our thoughts; it changes the way we think.
My favorite example of linguistic relativity is in the movie Arrival, where (spoiler alert!) linguistics professor Louise Banks is tasked with working with the military to communicate with aliens that have landed on Earth. Through regular “meetings” with two of the aliens, she begins to compile a record of the aliens’ written language. Louise learns that their language moves in circles, with each sentence lacking a clearly defined beginning or end. Interestingly enough, the aliens perceive time in a similar manner: to them, it was circular.
Louise works to decode the aliens’ language and, overtime, starts to have visions of the past and future. She, too, was beginning to perceive time as circular. Thinking in a different language altered Louise’s view of the world.
Arrival is just a movie, and the linguistic relativity hypothesis has garnered controversy since its origins in the early 20th century. But it’s been on my mind in recent months. I’ve watched a new “language” emerge for the new technologies and behaviors that exist in web3, and I’m not quite sure we’ve picked the right words. Today we’ll touch on the word “wallet.”
In my view, the word “wallet” falls short in a few different ways. Wallets in the traditional sense are static objects — they don’t change or adapt over time. They also don’t necessarily accumulate in value; wallets are purely storage facilities for capital, which, in turn, makes NFTs feel like capital assets. And if we want to get really pedantic, the word “wallet” often tricks people into thinking it holds actual funds as opposed to your keys.
It’s also important to consider how the purpose of a wallet has changed over the last few years. Up until recently, almost all wallets were built and designed around one thing: transactions. Many wallets are 3+ years old and were built solely for the purpose of buying, trading, and holding tokens. Since then, the purpose of the wallet has evolved. Now, we’re seeing more demand for wallets as a place to hold NFTs (see Genesis, Rainbow or Coinbase Wallet) and multimedia experiences (see Glass, DRAUP, and Altered State Machine). Put simply, wallets are becoming a place where people want to spend time, and there are more use cases today than ever before. Existing wallets will not (and, candidly, cannot) adapt to this new preference in behavior.
“Right now, the most common collection spaces take the form of “wallets” — blockchain based repositories, where owned items can be viewed as static images. These wallets are of little use to Digital Fashion collectors, as garments are neither shown off on a model, nor able to be curated and filtered.
This is like owning an haute couture dress but only being able to display it crammed in your wardrobe next to some Primark jeans, your high school Pokemon cards, and some old toys.” — Dani Loftus
When we think about how wallets — and what we call them — might continue to evolve, we can look to the factors that drove user adoption for previous wallets that reached mass scale. As a case study, MetaMask had 545,000 MAUs in July 2020. This shot up to over 10M by August 2021, driven by a surge of interest in “DeFi Summer,” where yield farming acted as a hook for consumers. At that time, it was an obvious choice for consumers to use MetaMask to take advantage of DeFi yields, as MetaMask was far more accessible (widely supported) than any competitor.
We can draw similarities between this example and the web3 ecosystem today. Supply of NFT projects, new yield farming opportunities, and social web3 platforms are all at an all-time high and only growing. Legacy wallets will initially consume new demand, but as the variety of applications, use cases, and behaviors expands, users (and developers) will need integrated, verticalized wallets that are more dynamic/supportive of leveraging on-chain provenance and transporting your digital identity across apps & chains. If this hypothesis is true, I expect to see an emergence of embedded wallets for different verticals or themes, each with their own terminology to onboard new users. Perhaps your digital fashion will be stored in a wardrobe, and you’ll show off your music NFTs by way of a discography. My friend Zach once encouraged me to think of wallets as the web3 equivalent of your email inbox. The user experience will suffer if we don’t have verticalized wallets for different consumer behaviors (trading, art, gaming, fashion, music, etc.), or at least an in-wallet search tool to sort NFTs accordingly.
My talented friend & fellow investor Jay Drain said it best: “Right now, crypto wallets look very much like inventories… in the future they will more clearly represent our digital identities by making them composable across the web.” I recommend you check out his full piece here.
To use language as a mode for coming to terms with our surroundings is to accept that our language structures our experience of the world. Perhaps this — inquiring into our own linguistically-induced blind spots — is what’s really in a name, after all.
Related: Do we see reality as it is?
Thank you to D’Arcy Coolican, Zach Davidson, Jarrod Dicker, Brandon Jacoby, Dani Loftus, Sean Thielen-Esparza, Zach Terrell, and many others for informing my thinking on this piece. If this piece resonated with you (or if you disagree!), I would love to hear from you. You can reach me via Twitter DMs.