Blockchain companies are trying to take over the smartphone sector – will it work?

Vlad Falin
October 27, 2022

Using web3 today comes with extensive frictions that hold back global adoption. Vlad Falin explains how web3's mobile innovations can remove them by rebuilding the operating systems they run on and profiles the leading mainstream manufacturers and web3-natives who are making it happen.

Powered by decentralised finance, non-fungible tokens, and decentralised autonomous organizations, the core features of web3's most recent cycle are indicators for how blockchain can permeate every sector of the economy. However, the hype has been tempered by the realities that every maturing technology needs to overcome: simplifying complexity to pave the way to mainstream adoption.

One of the great frontiers in the web3 adoption game comes in the form of mobile devices, a route through which the space can abstract complexity away into a device's operating system, and do so via the planet’s most successful consumer device.

In 2022, almost 7 billion people will own a smartphone, making it the ideal platform to reach the individuals across the globe. But as much as mobile represents an alternative route to the mainstream, conventional smartphones cannot access blockchain networks without using third-party apps and services, which is even more of an obstacle on the smaller screen.

Most users are reticent to download a crypto wallet, take responsibility for their own security, and go through multiple clicks to sign a transaction. Mobile presents an opportunity to remove much of the friction of web3 by integrating it into a device's hardware and operating system, thus opening the doors to millions more exploring crypto.

Today, established phone-makers and leading blockchains alike are pouring resources into mobile. In addition to abstracting away much of the complexity in web3, blockchain on mobile can enable a number of tangible use cases, including truly anonymised instant messaging, mobile mining, and making it easy to pay with crypto via your phone.

The Solana Saga

Last June, Solana Labs announced the launch of Saga, an Android phone augmented by a native integration to the Solana blockchain. It allows users to store digital assets, install web3 applications via the Solana 'dApp Store', and pay with crypto of fiat via Solana Pay. Solana has also promised to include a mobile wallet adapter and a seed vault to optimise seed phrase management.

Meanwhile, the design choice to build on Android rather than starting afresh means that the phone will come with an operating system that most phone users are used to, plus features like the Google Play Store to retain the rich ecosystem of existing mobile apps. The high-end phone (it has the latest Snapdragon processor and 12gb RAM) is available for pre-order, with customers required to pay a $100 deposit and a further $900 in early 2023, when devices are expected to begin shipping.

Solana founder Anatoly Yakovenko holds up a prototype of Saga, the Solana phone.

Beyond making it easy for users to access the web3 ecosystem, the company is making a complementary push to bring developers onto the platform. The Solana Mobile Stack (SMS) includes a software development kit designed to make creating Solana mobile dApps as easy as creating an Android app without losing the benefits of building blockchain applications.

A new ethos

Whilst the first Solana phones are expected next year, the Ethereum operating system is already in use today on select devices. Available for installation on three legacy Google Pixel devices, ethOS is optimised for crypto-native individuals with native Ethereum dapps, Ethereum Name Service (ENS) capability, crypto payments, and NFT display and minting support.

However, it must be noted that ethOS isn't built from scratch, given the technical complexity it would entail. Like Solana, it is built on Android, letting users interact with web3 apps and perform transactions for cryptocurrencies and NFTs using a built-in crypto wallet. Moreover, ethOS makes it easy for users to operate light nodes from their phone, less intensive and complex nodes that still contribute to the decentralisation of the network.

Ultimately, the goal behind ethOS is to eventually create a physical Ethereum-based phone, but the dev team has given no timeframe on its roadmap at time of writing.

Mobile presents an opportunity to remove much of the friction of web3 by integrating it into a device's hardware and operating system.

HTC in the Metaverse

Saga and ethOS demonstrate how blockchain leaders see the importance of a mobile approach to web3 adoption. But major mobile manufacturers are paying attention too. Amongst them is HTC, who have bet on web3 with its Exodus 1 smartphone, a BNB Chain-native phone a own wallet app, Zion, that is integrated with Binance's crypto exchange, a dApp ecosystem to download decentralised applications on BSC, and a social key recovery systems to provide recourse in the event of losing your private keys.

Exodus 1 was released in 2018, and the Taiwanese company has followed up on its blockchain venture with the HTC Desire 22 last July, billed to let users "enter the metaverse" via extended reality (XR). Developed to integrate seamlessly with the company's metaverse and VR platform, Viverse, it is another example of how existing consumer tech companies are feeling out the potential and demand for web3-powered mobile devices.

Probably Nothing

Meanwhile, Nothing, the phone manufacturer established by OnePlus co-founded Carl Pei, have partnered with the Ethereum sidechain Polygon to create the manufacturer's first mobile phone, Phone (1). Founded in 2020 and labelled "the most hyped tech company in years" by GQ, Phone (1) integrates crypto payments, storage, access to Polygon dApps, and Polygon's ID system.

A model demonstrates the the glyph interface on the Nothing Phone (1).

Available at a more accessible price point than Saga from £399, the Nothing team is more engaged in web3 principles than HTC's Exodus, where the web3 focus is largely reserved for wallet management, making a leading phone manufacturer in the web3 space. By contrast, Polygon's involvement allows the manufacturer "to make all of Nothing’s products future-ready by supporting sustainable and secure access to web3 applications.”

Though it won’t be available in North America (due to difficulty obtaining cellular coverage), Nothing has laid down a marker with the release of Phone (1) last August. The brand sold over 100,000 units in India within a month of that date, but hasn’t released global sales figures yet.

What Is Next For Web3 Mobile? 

There's no question that web3 will continue to gain mindshare across industry verticals as the cryptocurrency and blockchain industries mature and gain greater adoption in the coming years. And it appears that mobile will be one of the great frontiers in the space's growth, enabling a wave of adoption by abstracting away the complexity of core blockchain tools. Samsung is amongst the mainstream manufacturers to have built in crypto features to new releases, with their Galaxy S20 also able to store cryptocurrencies.

"Mobile will be one of the great frontiers in the space's growth."

This growth will begin with Android and will likely retain ties to the Google-built ecosystem for many years, given its rich developer ecosystem. By contrast, it's hard to see a future today in which Apple supports web3 protocols, with the Cupertino company preferring to keep blockchain innovations within its own walled gardens, such as charging a 30% commission on NFT sales made via iOS apps.

But the possibilities are exciting – the first models of web3 mobile devices offer a look at how web3 itself might force a rethink on how to overcome its biggest challenges. The reorientation of web3 towards mobile platforms is one of the major trends to follow in 2023 and beyond.

The Ethereum Phone team espouse a view shared across much of the web3 mobile sector: that a "decentralized web cannot exist with a centralized operating system".
The Ethereum Phone team espouse a view shared across much of the web3 mobile sector: that a "decentralized web cannot exist with a centralized operating system".
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Vlad Falin
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Vlad has over ten years of experience in digital marketing, focusing on content marketing for web3 and SaaS companies. He has been an active participant in web3 and brings unique insight to topics he writes about.