Elrond, the Internet-scale blockchain w/ Beniamin Mincu

On this episode of The Ledger Podcast, host Mo Sayed is joined by Beniamin Mincu, Founder and CEO of Elrond Network, and Fabrice Dautriat, Ledger’s Head of Platform, for a weekly rendezvous from Paris. 

They delve into Elrond’s journey, its cutting-edge blockchain technology designed for internet-scale adoption, the significance of EGLD’s integration with Ledger Live, and their shared vision for an open, secure, and user-friendly financial system.

Key Highlights:

Elrond’s Genesis: Solving Scalability and UX Frictions

Elrond was founded in 2017 to address critical limitations within the blockchain ecosystem, particularly related to transaction speed and gas fees. Beniamin Mincu, reflecting on his long history in the blockchain space since 2014, noted that despite the market’s growth in 2016-2017, the core problem that they discovered were actually not addressed in a meaningful or compelling way. 

He identified two key problems for global blockchain adoption:

• Scalability: A transition from dial up to broadband to enable asset transfers at the scale and speed and cost of the internet.
• User Experience (UX): A huge UX simplification similar to that of the browser moment in the early internet days”.

With these insights, a team was assembled to build rockets and started working on Elrond. Elrond’s ultimate goal is to onboard the next billion people in the space, believing that this will fundamentally change the game for everyone.

EGLD’s Seamless Ledger Integration: Boosting Security and Accessibility

“(For web3), improve the UX and bring crypto to normal users… to my sister for instance, that’s really what’s driving us day to day”. – Beniamin

A significant development is the integration of Elrond’s native currency, EGLD, directly into Ledger Live. Fabrice Dautriat explained the evolution of this integration: initially, Elrond developed an application for the Ledger hardware wallet, compatible with their web wallet. 

The next crucial step was bringing EGLD directly into Ledger Live. 

This integration creates a hub where users can manage EGLD alongside other supported blockchains from a single, secure place, with future plans for features like buying and swapping tokens. 

Elrond’s “Internet-Scale Blockchain”: Achieving Unprecedented Scalability

Beniamin Mincu highlighted the inadequacy of current blockchain throughputs (7-15 transactions/second) for global adoption, emphasizing the need for tens to hundreds of thousands of transactions per second. 

Elrond, with its adaptive state sharding and secure proof of stake, achieves over 100,000 transactions/second efficiently and carbon neutrally, transforming cryptocurrencies into viable mediums of exchange.

Hardware Wallet Evolution: Adapting for Daily Usage

Fabrice Dautriat discussed the impact of enhanced blockchain scalability on hardware wallets. He emphasized that the core value of secure hardware wallets, owning one’s seed, remains paramount. 

However, for daily use beyond just storing value, hardware wallets must adapt for convenience, offering features like tap-and-pay and customizable transaction thresholds. New protocols, like managing tokens, minting NFTs, and staking, demand increased processing and memory from hardware wallets. Ledger is addressing this by launching a new device with increased memory and better options. Fabrice concluded that hardware will evolve in performance, usage, and convenience but will remain essential for securing assets.

The Future of Layer 1 Blockchains: Specialization vs. Mass Adoption

Beniamin Mincu envisions three phases for Layer 1 blockchains: a bootstrapping phase for stability, an intermediary phase where most use cases play out, and an end state with massive, unforeseen adoption in core verticals. 

He believes the ecosystem is in its very early inception and not a zero-sum game, aiming to onboard the next billion people to reach a critical threshold where crypto becomes the default, making traditional markets obsolete.

Key Verticals for Mainstream Penetration: DeFi and NFTs

Beniamin starkly contrasted traditional banking’s reliance on 30-year-old technology with DeFi’s automated, digital core.

“Imagine sending an email where after you send the text someone takes the horse and drives to the next town and delivers the message…DeFi, once you grasp the idea correctly, is something that is already inevitable” – Beniamin Mincu

Ledger’s Platform Shift: Beyond Hardware Security

Fabrice Dautriat elaborated on Ledger’s strategic pivot from solely a security company to a platform that empowers other builders. 

This means providing tools and guidelines that are simple, and as free and frictionless as possible for anyone in the crypto industry to integrate Ledger security into their projects. 

The broader mission is to provide security for the entire crypto industry and serve as a crucial alternative to centralized services, ensuring anyone can be owning their own asset and being their own custodian. 

This aligns with the Web3 ethos of digital sovereignty and owning one’s keys and assets.

Beniamin Mincu expressed immense optimism for 2022, envisioning it as the best year yet for Elrond. 

Key initiatives include launching MarDex, a permissionless marketplace, to help projects go from idea to liquid ecosystem. 

Watch the full episode below:

Key Insights on the Future:

Beniamin Mincu

• Biggest Web3 Challenges: Beniamin identified three core problems: 
  • fundamental performance of blockchain architecture, 
  • ux simplification, and 
  • legal obstacles. 
• He firmly believes that UX will be the most critical challenge and the largest potential adoption multiplier, advocating for abstracting complexity, making defaults simple, and implementing progressive security tailored to the user’s asset value.
• Web3’s Ideal State: He summarized the ideal Web3 experience will feel like web 2 in interaction and will have the fundamental building blocks and new optionalities like owning your data, owning your assets and doing all of that in a way that seems effortless.

Fabrice Dautriat

• Future Trends: Fabrice agreed that the next big revolution will be around culture and communities, enabling broader engagement beyond complex technical understanding. He also highlighted payments as a significant emerging trend, emphasizing the need for bridges to connect crypto with the legacy world.
• Biggest Web3 Fear: While confident in solving performance and UX, Fabrice’s biggest fear is that on the path to go to web3, people just forget about the reason why they built it in the first place. He stressed that if core principles like ownership and self sovereignty are abandoned, then it would be as good as using web2 all over again. He remains hopeful that the hardcore old gang will ensure the industry stays on track.

Reading List

Learn more about these topics mentioned in the episode, or explore our library of articles on Crypto, Security, and Regulation on Ledger Academy

• Elrond
• Ledger Live
• Secure Proof of Stake
• Hardware Wallets