Episode 449 | Jess Houlgrave, CEO of WalletConnect

Greg, thank you very much for having me. I'm very excited to chat with you today.

I was born in Devon, in the southwest of the UK. That's probably where I get my love of the sea from. It took me a while to get back to the sea; now I live very close to the sea in Lisbon, Portugal. In the meantime, I spent many years working in London, traveling all over the place, doing a bit of work in the US and in Dubai. I've been here for the last couple of years, where I escaped the British weather and get a bit closer to the beach.

After school, I studied economics at university and, like many of my peer group at the time, I followed everybody into the city of London and became an investment banker. I didn't really know what else to do, to be honest. My parents didn't have very traditional careers, so that seemed to be where the crowd was heading. I worked for Credit Swiss for some time and then for a Canadian pension fund. This love of economics hit me again back in 2014, when I started to learn about Bitcoin. One of the things I'd written about at university was the history of monetary systems. Seeing Bitcoin evolve was like watching monetary systems change in real time. I became very interested in crypto, left my work in private equity, and throughout 2015 and 2016 was really investigating crypto and blockchain a lot. I wrote a master's thesis on the applications of blockchain for the art world and built my first startup in the space, using technology to track the provenance of physical assets like high-value artworks to create an immutable record of their history. One thing I learned was that timing is everything, and we were way too early to put this tech into the art world. After that, I joined a payments company called Checkout.com, a European-based acquirer. I was Chief of Staff there, worked across the whole business, and especially during my latter years, I was very focused on our crypto strategy. I worked a lot with our crypto customers and also thought about our crypto payments strategy. I left Checkout at the beginning of 2023. What I was really looking for was something pure play crypto again, where I could really get involved in building the next generation of financial systems. I met WalletConnect through some of their investors and board members. It was already a pretty well-established project in the crypto space. As a crypto user, I had used their services and products a lot and had built some things with their products. It was a real honor to be able to join the team. I spent the last two years growing it and evolving it into what it's become today: a global network with about 700 different wallets, over 70,000 different applications, and we move about $400 billion a year across that network.

You can think of us, using a traditional payments analogy, a little bit like Plaid or ISO 8503 messaging or Swift messaging. We basically provide a set of messaging standards to the industry that allows them to communicate securely with one another. On one side of the network, we have all of our wallet partners. These include wallets that sit on your mobile phone, like Trust Wallet or MetaMask, hardware crypto wallets like Ledger or Trezor, all the way through to institutional and custodian offerings like BitGo, Fireblocks, and Crypto.com Custody. On the other side of the network, we have about 70,000 different applications. These could be a crypto-native application like an NFT marketplace, a DeFi trading protocol, prediction markets like Polymarket, or a more traditional merchant or payment processor who wants to accept crypto as a payment mechanism. We connect these two sides so they can communicate. On the wallet side, we have a suite of SDKs that wallets can integrate. On the app side, we have applications that work directly with some of our SDKs, but we also have a whole range of channel partners through whom applications and payments companies can access the WalletConnect network. Coinbase Commerce uses WalletConnect as part of their offering to merchants via Coinbase Business. We work very closely with Mesh Pay and Mesh Connect, another solutions provider for crypto specifically for the payments industry, and Privy, owned by Stripe, are also partners. There's a whole range of ways applications and payment providers can integrate with the network, either directly or with a partner.

If I narrow down to the payments use case, which is probably most interesting for your audience, in web two payments today we are very spoiled with user experience: super seamless. I just take my phone into a store and tap it, or through an e-commerce flow I have a one-click express checkout that shares my shipping information. If I want to pay with crypto today, that user experience is much harder: scanning QR codes, multiple buttons to press, understanding which chain my asset is on, whether the merchant accepts that specific asset on that chain, and having enough gas fee to complete the payment. There are all these crypto-specific aspects that compromise the user experience compared to a web two payment. A lot of what we're working on right now is upgrading that experience so that in 18 months, a crypto payment is as seamless as a web two payment: a one-click tap or button. Information is exchanged, compliance is handled, messaging is handled easily. Consumers want to pay with crypto. The volume through cards linked to crypto wallets is small on an absolute basis but rapidly growing. There's definitely an appetite for consumers to pay with crypto and for merchants to accept it. Stripe, for example, saw increased revenue from merchants by accepting crypto payments. Also, crypto payments are much cheaper for merchants than card payments, almost instantly settled. So there are many attractive attributes. The central part of our roadmap over the next 12 months is improving user experience. We just published a new paper outlining steps, and many wallet partners are on board. So over the next 12 months, we'll get the crypto payments experience much closer to web two.

We're very unusual in that we don't really have a direct competitor for what we do. The alternative to using WalletConnect is for an application to build bilateral integrations with every wallet. Most application builders don't want to do that; it's clunky and disrupts user experience because one wallet behaves differently from another. We're kind of unique in the crypto space. We've come to think of our competitors less as connecting crypto apps and wallets and more as moving money around the world and providing a better experience for end users, whether on a crypto rail or traditional payments rail. If you step back, our competitors are really the big payments networks. As crypto adoption grows, the idea of using crypto for payments will become much more obvious.