Over the past year, investors have learned the importance of moving their cryptocurrencies offline. Those who kept their Bitcoin and altcoins on exchanges like FTX lost control of their assets. This highlighted the adage “Not your keys, not your coins.” However, this loss for FTX became a gain for hardware wallet manufacturer Ledger. Ledger experienced a surge in sales following FTX’s bankruptcy filing in November 2022. Despite some controversy, Ledger remains one of the most popular crypto wallet makers in the world.
According to Pascal Gauthier, the change in tone towards Bitcoin in 2023 triggered a wave of interest from large companies like BlackRock. The media narrative around Bitcoin shifted from being associated with illicit activities to being accepted by major financial institutions. Gauthier believes that big money is coming into crypto, as evidenced by the involvement of companies like Fidelity and Vanguard.
When it comes to regulations, Gauthier states that the next administration will determine the fate of crypto in the United States. He suggests that if Biden remains in power, there may continue to be aggression towards crypto, while a different administration could bring about changes.
Regarding cold wallets, Gauthier acknowledges that there have been issues with user experience (UX). Ledger aims to provide a better UX without compromising security or self-custody. They have introduced a service called Ledger Recover to address concerns about safeguarding seed words. This service allows users to shard their private key into three encrypted shards and store them with different custodians.
Gauthier dismisses social recovery as ineffective and emphasizes that businesses like Ledger and Coincover are better suited for shard recovery due to stricter verification processes. He addresses concerns about security and transparency regarding Ledger Recover, stating that while they have made the product open source for transparency purposes, sub-custodial companies do not have the necessary tools to reconstruct private keys.
In terms of Ledger’s business model, Gauthier believes that even if large custodial institutions enter the crypto space, users will still seek out technology companies like Ledger for their expertise. He anticipates that these institutions may even purchase parts of Ledger’s technology to build their own infrastructure.
Gauthier also discusses the differences between the business climates in Europe and the United States. He states that Europe tends to over-regulate or regulate too quickly, while the US has a slower and more complex legal process. However, he believes that when change does come in the US, it is often for the better. Gauthier suggests that heavy regulation in Europe may hinder innovation.
In conclusion, Ledger has experienced significant growth in sales following FTX’s bankruptcy filing. Pascal Gauthier sees a positive shift in tone towards Bitcoin, with major financial institutions getting involved. Ledger is focused on improving user experience and offers a service called Ledger Recover for safeguarding private keys. Gauthier believes that even with the entry of large custodial institutions into the crypto space, technology companies like Ledger will still play a crucial role. He acknowledges the differences between European and US regulations and suggests that heavy regulation may stifle innovation.
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