How can we make blockchain-based apps usable for the masses, not by hiding the underlying mechanics of the system, but by revealing them in a way that makes them simple and intuitive?
Welcome to my new article series, Trustless Design. I’ll be discussing how solving the UX design problems of decentralized apps requires different techniques than the ones that worked in web2, and just slapping on “abstraction” is not the answer.
Decentralization creates a revolutionary tradeoff. The ability of governments to enforce consumer protections, laws and regulations against apps to protect users is reduced. Teams are often anonymous, globally dispersed, and out of reach of laws and prosecution. Even when teams act in good faith, hacks and exploits are common, and user errors can be irreversible.
In exchange, the power of users to independently verify information, exert control, and enforce transparency is dramatically increased to a degree that’s never been possible before, through blockchains, smart contracts and open source code.
In web2, UX designers are used to solving problems via abstraction, presenting users with a mental model of how the app works that is useful without needing to be accurate, and without needing to faithfully represent the true underlying technology of the system.
In defi and web3, this kind of abstraction risks creating the worst of both worlds. Users get none of the protection of highly regulated public companies, but none of the tools for transparency and control that blockchains offer.
A good example of this was StableGains. This YCombinator backed startup promised to make DeFi simple and easy for the masses by handing all of the technical on-chain stuff under the hood. In order to make it really easy to use, they would not even tell you where your money was being invested. All you had to do was deposit funds and then you would get a 15% APY. Users were told their money was being diversified across many protocols, but behind the scenes, all customer funds were actually being put into one high-risk protocol, Anchor, as UST.
On May 9, UST started losing its peg to the dollar. Anyone who had funds in Anchor directly (I had a small amount) had a full 24 hours to get out at a small loss, before it went to $0. When UST started depegging to $0.97, I immediately checked liquidity on several chains, bridged, and swapped my funds to USDC.
StableGains users did not even know their money was in UST or Anchor at all. They never had a chance to evaluate risk or to decide whether to get out or stay and hope it repegged, and even if they had known, the app would not have allowed them to. All they saw on the app interface was their balance in dollars and then one day all of their money was gone.
Traditionally, the goal of UX is to create magical interfaces - but it seems that when it comes to digital assets, the most popular magic trick is the one that makes them disappear.
We need a new UX model, “trustless design”. The goal must be to create simple, usable interfaces, not through mystery, but through transparency.
Here’s a good definition of “trustless”.
While trustless is defined by Merriam Webster as “not deserving of trust,” in the blockchain space it means something entirely different. Trustlessness in the blockchain industry simply means you do not need to place your sole trust in any one stranger, institution, or other third party in order for a network or payment system to function. Trustless systems work and achieve consensus mainly through the code, asymmetric cryptography, and protocols of the blockchain network itself. The trustless environments that blockchains have created enable the peer-to-peer (P2P) sending and receiving of transactions, smart contract agreements, and more.
The concept of trustlessness is a core element of blockchain, crypto payments, and smart contracts. “Trustless” means that you don’t have to trust a third party: a bank, a person, or any intermediary that could operate between you and your cryptocurrency transactions or holdings. Depending on how you choose to store, move, and trade your assets, you may have a trustless set-up or a set-up that requires the trust of a third party.
— Cryptopedia
Figuring out how to create simple and usable interfaces that accurately represent the underlying technology, so that people can navigate this wild west safely, will be the core challenge of design in web3.
Here is the question we must answer, as we figure out how to make blockchains, wallets, and the like accessible to the mainstream: