Solana
Solana developer says new crypto phone ‘looks like madness’ – but it already has $65 million in pre-orders – DL News
- Solana’s Steven Laver brings BlackBerry and Apple experience to the Chapter 2 handset.
- Crypto needs to break free from the desktop if it wants to scale, says the Solana team.
- Solana undertakes a herculean task by embarking on manufacturing.
At first glance, Steven Laver does not seem like the one who would lead the most daring project in crypto.
The 43-year-old software engineer worked on the BlackBerry in the 2000s, then helped develop the Windows Phone app store at Microsoft.
He didn’t even work in crypto until early 2022.
Nonetheless, Laver is now the lead software engineer in Solana Labs’ drive to change the crypto experience by putting blockchain capabilities in the palm of your hand.
“It has such great energy that the sky is the limit,” Laver said. DL News in a rare interview. “It sounds like madness, but at the same time it feels like the end result.”
This result is Solana’s second cell phone.
It’s called Chapter 2 and is expected to be released in early 2025. Pre-orders for the new device cost $500, and Solana claims to have more than 130,000 pre-orders. This represents $65 million in pre-orders.
Daring bet
It’s a bold bet for the four-year-old blockchain network. Mobile telephony, one of the most regulated industries on the planet, is dominated by Apple and Samsung.
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Why Solana, a pillar of DeFi with symbolic value 82 billion dollars and one of the hottest brands in crypto, making such a huge bet on hardware manufacturing?
“It’s a very difficult question,” said Chris Lewis, an independent telecommunications analyst with more than 40 years of experience in the industry. DL News.
The answer: control.
Chapter 2 is Solana’s attempt to free cryptography from the desktop and the dominance of Apple and Google’s application platforms.
Silicon Valley powerhouses have long harassed crypto-friendly mobile developers by charging huge fees or banning apps from their platforms.
In a world where investing, shopping, banking, and everything else happens on a smartphone, crypto is still fighting to gain a foothold.
“We’re used to everyone bringing a laptop to dinner, so you don’t miss a drop or a claim,” said Emmett Hollyer, manager of business development and operations at Solana Labs. DL News.
The madness of Memecoins
Solana, of course, is not the first crypto company to attempt to open up the grip of incumbents.
Over the past decade, more than a dozen custom-built crypto phones have hit the market. But none gained popularity.
Last year, Solana took a chance with Android-based Solana Saga. Customers picked up about 20,000 of the $600 handsets, which was well short of the 50,000-unit goal.
In comparison, Apple shipped more than 80 million iPhones in the fourth quarter alone.
But Saga discovered what appeared to be a not-so-secret weapon in crypto phone development: memecoins.
The device came with a dog-themed memecoin called BONK. Somehow, collectors fell in love with BONK and its price soared 560% last December.
When investors rushed to call secondary markets, Hollyer and his team realized they had stumbled upon a new type of marketing strategy.
Now they are producing a sequel.
“Consumer hardware is difficult, but phones are a much greater order of magnitude.”
—Steven Laver, Solana
Although the company declined to disclose how much money it is investing in Chapter 2, it’s not a small number.
“Consumer hardware, in general, is difficult, but phones are a much higher order of magnitude,” Laver said. “Building a phone is an exercise that is as much about operations, logistics and compliance as it is about the underlying technology. »
The project comes as Solana is riding a wave of momentum. Its native token, SOL, rose 78% this year, compared to a 64% rise in the price of Ethereum, according to CoinGecko.
With a market value of $81 billion, Solana is the fifth largest digital asset.
Solana has also largely conquered the hot memecoin market. Activity was so strong in March that the network generated more costs than heavyweight Ethereum – no small feat.
Lingering Questions
Still, questions remain about whether to launch a mobile phone.
“What are you bringing,” Lewis said. “Is it just security? Is this a new interface? Is this the latest chip power? I think those are the questions you ask yourself, and then being able to build the brand and market it.
And, perhaps more importantly, is there actually a demand for a crypto phone?
Deep roots
Solana’s project is deeply rooted in Silicon Valley’s mobile scene.
It grew out of a little-known but much-loved project called Essential, founded by Andy Rubin, the brains behind Android at Google.
After Essential closed in 2020, some employees started another cell phone company called OSOM. A few years later, it developed the OV1 phone, which, featuring a ceramic and titanium body, became a cult favorite.
If you look closely, it also looks a lot like the Solana saga. This is because they are almost the same. Solana Labs and OSOM announced a Partnership in June 2022.
In February 2022, Laver landed in Solana right in the heart of Saga development.
Originally from Canada, Laver studied computer engineering at the University of Waterloo in Ontario (the same alma mater as Ethereum co-founder Vitalik Buterin).
Iconic products
Laver was present at the creation of several iconic products. He worked on a range of BlackBerrys, made by Canadian company Research in Motion, which introduced portable email and texting to business life.
At Microsoft, Laver worked on what would become the Windows Phone app store. He has also worked on other consumer electronics products such as smartwatch maker Fitbit, as well as at Apple and Google.
“There are many low- and mid-budget Android phones that look like a cheap car dashboard from the late 90s.”
—Steven Laver, Solana Labs
From the start, Laver said the Saga was designed to have a satisfying weight in hand and a sleek matte finish.
“There are many low- and mid-budget Android phones that look like a cheap car dashboard from the late ’90s,” Laver said.
Solana’s device was designed with three features not found on normal handsets.
The first one was called Seed Vault.
This stores the seed phrases that users use to send and receive cryptocurrencies. Saga’s security falls somewhere between an internet-connected crypto wallet such as Phantom or MetaMask and the vault-style Ledger, Laver said.
It’s not intended to hold millions of dollars of crypto, but you can buy a few cocktails with it.
Challenge Apple and Google
The Solana Mobile Stack allows mobile app developers to create crypto apps for the phone. And the Solana dApp Store gives projects a marketplace for their work.
It is designed to be a purpose around the Apple App Store, which has taken down a few of the largest crypto apps in the industry, perhaps most notably MetaMask in October. It was later reinstated.
In-app purchases on the Apple App Store are also subject to a whopping 30% fee.
As for Google’s Play Store, it relaxed its crypto policy last summer. But he also generally charges developer fees between 15% and 30%.
Laver says the Solana Labs team is going to let crypto be crypto.
“We are adopting a much lighter policy,” he said. “We’re doing our best to get out of the way.”
Profit center
Solana Labs does not charge any fees, except for the fee for publishing application metadata on the Solana blockchain.
“It’s not a profit center for us,” Laver said.
The platform already includes NFT marketplace Magic Eden and decentralized exchange Jupiter.
“We need to find a way to give manufacturers a reasonable path to distribution.”
—Emmett Hollyer, Solana Labs
Hollyer hopes this will put pressure on Silicon Valley to take a more enlightened approach to crypto.
“Hopefully Google and Apple will come to their senses and see what might be possible if they relax some of their pricing structures and some of their restrictive policies,” he said. “Until then, we need to find a way to give manufacturers a reasonable path to distribution.”
Solana recently registered its 100th dapp.
“We’re just starting to get to that point where developers are starting to see the value in building a phone like Saga,” Laver said.
BONK goes boom
But the big change in the development of the Solana phone was BONK, the $2.1 billion meme coin. Solana invested $750 in BONK tokens with each phone.
When the token skyrocketed in December, 30 million BONK tokens were integrated directly into the Solana Saga phone. An arbitrage trade emerged.
“With BONK, I bought other memecoins,” said Lui Kohl, product manager at token acquisition platform Streamflow. DL News. “Overall, I think I turned $800 worth of BONK into $4,000, so it was worth it financially.”
Thanks to the BONK buzz, Hollyer said Solana was able to sell the rest of its phones in three days.
The episode also sparked anticipation in Chapter 2, which will be loaded with five memecoins. Kohl’s, for its part, has already pre-ordered the phone.
Absorbing the lessons of crypto mobile marketing, Laver admitted he was “personally a little confused.”
“Blockchain is just a little bit different,” he said. “Ultimately, putting a real, well-integrated, physical product in people’s hands is why I do this.”
Liam Kelly is based in Berlin DL News’ corresponding. Contact him at liam@dlnews.com.