Yeah. So, Ledger Enterprise was designed for this. Had they used Ledger Enterprise, they would have not lost the money because it resists man-in-the-middle attacks. The Bybit hack was impressive, but worse can happen. There is more money in crypto now, so hackers will target it. This industry learns by making big mistakes.
Welcome to the Dubai talk show. I'm your host Lubois. Today our guest is Pascal Gauthier, the CEO of Ledger. Welcome to the show, Pascal.
Merci. Thank you for having me.
So tell us more about the latest innovations of Ledger. You've been trying to position the company as the Apple of Web 3, with innovative designs and better user interface.
We don't call ourselves that, but thank you. We are doing our best to design great products and experiences. We had a pivotal moment a few years ago when we started to think product first and tech after, inspired by Apple. We onboarded Tony Fadell to design our new products, Stax and Flex, bringing product design culture into a security company. Now we have the best of both worlds: uncompromised Ledger security and Apple-like UX/UI.
You have been a great advocate of self-custody. Tell us about the benefit of storing your own crypto off centralized exchanges.
The benefit is that if you don't own your crypto, why Bitcoin? Bitcoin is a decentralized peer-to-peer system. The invention is a digital money network available 24/7 that cannot be stopped, where people transact directly. To do that, you need your private keys. Self-custody is digital private property. You can keep it yourself or leave it at the bank. But for interacting with blockchain apps, you need your private keys. Self-custody began with Bitcoin. Custody didn't exist then; people kept keys on insecure computers. Security of private keys is often overlooked. The industry focuses on growth, not security. The 1.5 billion hack shows that when money is gone, it's gone. Attackers are sophisticated, like Lazarus. Security is paramount. It took us eight years to develop the Nano S in 2016. Education is key. If you have a lot of money, you need a hardware wallet like Ledger. For $100, a software wallet is fine. Self-custody done right means good UX and UI, which we achieved with Stax and Flex.
So self-custody is specifically for blockchain. How many years ago did it start? Bitcoin exists since 2008 or 2009, right?
Right?
So what about self-custody? When did it begin?
Self-custody began with Bitcoin. You had to keep your Bitcoin yourself. The white paper didn't address private key security. Security engineers think differently than software engineers. The industry focuses on top-line growth, not security. The 1.5 billion hack shows the stakes. Attackers are North Korean Lazarus group. Security has to be paramount. It took us time to bring the Nano S to market in 2016. Education is needed. If you have a lot of money, you need a hardware wallet. For $100, software is okay. Self-custody done right means good UX, which we have with Stax and Flex.
To be honest, I don't have a Ledger or any hardware device to store my crypto.
What do you do? What do you do?
How do you secure your crypto?
I keep it on the exchange basically.
Yeah. Okay. So, no, look, everything is a choice and a compromise. Keeping it on an exchange has risks: the exchange can lose the money, block your account, and it defeats the promise of money that is yours and movable. But it's not necessarily bad; it depends on the exchange and trust. However, nobody is too big to fail. At minimum, you should have some assets in self-custody on a Ledger and leave some on the exchange for fast trading. Don't put all your eggs in one basket.
Yes, it was quite controversial that the first fully regulated crypto exchange in the UAE by VARA was FTX, and then the next day the company went bankrupt.
Yeah, exactly. Banks are not too big to fail; Credit Suisse fell. My point is not to scare everybody, but people must understand that if you are a citizen, you have private property in your physical life. In your digital life, you will have digital assets that are yours, that you can control and exchange. Because that's a possibility, people need to wonder what it means for them. It can be money, identity, or many things going forward. Many things will be tokenized. So people will own more digital tokens in the future, and they all need a Ledger to store their digital value securely.
Talking about security, how many employees does your company have and how many of those can you classify as hackers?
The company has close to 650 employees. The hacker group is small, called the Don, with less than 15 people. They are white hats who hack for good, raising the security bar for our products and helping other companies. It's a collective win. If everybody gets better at security, we all win. It's the best attack lab in the world for cryptography and cryptocurrency.
We can easily say that Pascal is one of the most well-connected people with hackers in the world.
No, we can't, because they work from a zone that I cannot access. When you run a security company, you have segregation of duty. There are many things I cannot tell my team because it would interfere with security. The dungeon and high-level security report directly to the chief security officer. My badge doesn't even work there. Security is about freedom and democracy. Without security and privacy, you don't have private property, and without private property, you don't have democracy. At Ledger, the most important security teams can totally not listen to me and do what's right for the users.
