Cryptography - Product, Feature or Buzz?
Real value is rarely just about crypto technology, but more the daily changes it drives.
Welcome to Cyber Builders 🖖
I’m excited to continue our series on cryptography. In the last three weeks, I covered secure multiparty computation and WordID. These advanced cryptographic algorithms and technologies protect identities and allow data comparison without any leakage, aligning perfectly with GDPR requirements. I encourage you to check out the previous episodes (links below)
A thought-provoking comment on a recent post suggested that crypto is rarely a true product. Instead, crypto founders are often mathematicians who turn their groundbreaking ideas into algorithms or technologies but - following the thread here - consistently fail to build a company and product.
This is an interesting take. Are crypto products truly products, features, technologies, or just a passing buzz?
I will demonstrate today that if you're considering starting a new company or product centered on crypto, it's essential to consider and search for a transformative use case that your crypto technology will enable. This is where the value truly lies.
What Do We Mean by Product, Feature, Technology, or Buzz?
To frame our discussion, let’s define what we mean by product, feature, technology, and buzz:
Product: A complete, market-ready solution designed to meet specific user needs, often sold directly to consumers or businesses.
Feature: A distinct functionality or capability within a broader product, enhancing its value and usability.
Technology: The fundamental scientific principles and processes that enable the creation of products and features.
And what do I mean by Buzz… well, you know. A “buzz” is a concept or trend that generates excitement but may lack substantial use cases or lasting impact. We have tons of “buzzing” themes around us, and the tech industry has a long list of concepts that were supposed to be the next big things but never really get adopted widely.
Crypto as a Technology
Cryptography is the backbone of many essential aspects of modern society. It’s not just theoretical mathematics; it’s a critical technology underpinning:
Secure Communication: Encrypting messages to ensure privacy and prevent unauthorized access is crucial for apps like WhatsApp and Signal.
Payment Systems: Ensuring the security and integrity of transactions, from credit card payments to cryptocurrencies like Bitcoin.
Digital Identities: Protecting personal information and verifying identities are essential for online services and platforms.
Cryptography is an indispensable technology that provides the foundation for secure interactions in a digital world.
When cryptography is used as a technology, you won’t see cryptography. It will be hidden (🔒 in your browser) and provide a hidden but essential “secure layer” on top of a true feature or product.
The user doesn’t know nor see any element of the cryptography algorithm.
Crypto as Features
When we talk about crypto as features, we’re referring to specific cryptographic functionalities integrated into larger systems:
Digital Signatures: Allowing users to sign documents electronically, ensuring authenticity and non-repudiation. This feature is crucial for document management systems and online transactions.
Two-factor authentication (2FA) Enhances security by requiring two forms of identification before granting access. It is widely used in banking and email systems. Crypto is key
These features enhance the security and trustworthiness of various products and services, making cryptography a critical component of modern digital infrastructure.
When cryptography is a feature, you’ll see cryptography elements like document hashes or signature elements on your favorite signing platform. You often use that feature to “act” on the system and manage its trust.
When a user “logs in,” she provides her credentials or access key. It is not hidden. Moving forward and connecting to the systems or signing a document is intentional.
Crypto as Products
Cryptography can indeed be seen as a product, with tangible examples that many people use daily:
VPNs (Virtual Private Networks): Millions rely on VPNs to securely connect to remote networks, protect their privacy online, and bypass geo-restrictions. VPNs are a clear example of a crypto product leveraging encryption to provide a secure internet experience.
Cryptocurrencies: Digital currencies like Bitcoin and Ethereum are products built on cryptographic principles. They offer decentralized financial systems that operate securely without central control.
These examples show that cryptography isn’t just an abstract concept but a practical product category with real-world applications and substantial user bases.
When it is a product, Users see cryptography and act intentionally as with Features. However, we should also recognize that crypto has a broader impact than providing trust. It is an enabler of new use cases.
Think about the VPNs. Before VPNs, you had to subscribe to leased lines, which were expensive and rigid, if you wanted to interconnect your HQ and a branch office in another town. After VPNs, you must leverage your Internet connection and virtually connect from anywhere to your private networks.
When crypto is a product, it is more than an underlying technology or a nice feature. It enables new use cases.
The latest “crypto” topics… SMPC, DAO, and Blockchains
I will be direct: I am fully with the anonymous reader who left me a comment. Most new cryptography tools are not real products. They are, at most, new technologies that would enable more trust, safety, and security in other true products.
I don’t buy apps that are “blockchain for X.” However, there is an interesting use for blockchain technologies.
Look, for example, at Helium Networks. This startup enables you to deploy an IoT Gateway (based on the LORA protocol) and offer a local IoT network around your house or business. Blockchain technologies enable fair revenue for those who invest in hardware, energy, and internet connectivity to redistribute this to local IoT devices. It’s a brilliant idea.
But it is not about “crypto”; it is about connecting people's objects and deploying IoT at a fair price, independent of the large telcos who often abuse their monopoly to have outrageous prices.
Moreover, cryptography by itself is maths. And you don’t sell maths. You teach maths; you write maths books… But there is no business value when it’s essential to humanity and science.
Conclusion
In conclusion, cryptography is a critical and versatile component of our digital lives. It encompasses technology, features, and rare products that are vital in securing communication channels and providing essential functionalities within larger systems.
Building a crypto product is hard because it is often NOT related to crypto. Success is bound to the use case you will enable and the changes your product will drive in the future.
Happy to get more comments 👇
Laurent 💚
