A VC’s guide to crypto UX
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This week we’re quoting…
Sharene Lee (Co-Founder at Takadao)
What Lee said:
“Being an early stage startup in the crypto space, it's often hard to overcome initial scepticism.”
The invisible power of Crypto UX
Lee’s startup, Takadao, was one of our 2023 Rocket Fuel Startup Pitch competition winners. And her company, which makes crypto financial services accessible to excluded communities, definitely prioritises UX – because it has to. You can’t make financial services accessible if they’re not…accessible.
But not all crypto platforms are designed with first-time users in mind.
If we’re honest, in spite of improvements in recent years, a lot of crypto UX still feels like it was designed by developers, for developers.
You land on a dApp. It’s got a wallet connect button, a couple of tabs that don’t explain much, and the first thing it does is ask you to sign something cryptic that feels a bit like robot legalese. Not enough context, not enough clarity; not enough reassurance that you’re in the right place, doing the right thing.
And then…the user bounces. They don’t know how to use the thing and they don’t feel enough trust to enter sensitive information, so they leave.
No matter how sophisticated your smart contracts are, or how novel your tokenomics may be…UX is where trust is built or lost. And it might be among the biggest challenges holding crypto back from mass adoption.
UX has come a long way – but not far enough
Wallets are sleeker than they were a few years back, and onboarding is faster. But users still have to do a fair bit of work just to get started. Compared to traditional banking services, it’s not bad; but if you compare crypto UX with digital-first banks, for example, then crypto apps have a long way to go.
Most users who drop out aren’t dropping out because they decide DeFi isn’t for them. They’re dropping out because the experience is clunky, confusing…or sometimes infuriatingly complicated.
Why should VCs care?
Pitchbook projects that crypto VC funding will surpass USD $18 billion in 2025, and we’ve seen crypto firms hit major milestones already this year – like Sygnum, the digital asset bank that reached unicorn status in January.
As more VCs turn their attention to the crypto space, they’ll have their own criteria for identifying valuable startups. But UX is something they shouldn’t overlook.
If you’re considering an investment in a crypto platform, you need to assess its value from a UX point of view. That includes asking questions like:
- Are messages and notifications clearly signed, in language that humans can understand (and not in random strings of characters)?
- How long does onboarding take?
- How easy is it to add and transfer balances?
- Is it clear what you need to do after a transaction has been submitted?
- Is there good visibility over the status of transactions?
- Are there small UX touches (like success animations and progress bars) that reassure the user and build trust?
- Has a UX copywriter written the text for CTA buttons…or is everything written in technical language that only a developer would understand?
- Do users feel confident that their funds and data are safe?
Because if the UX is unclear, the user won’t trust the platform or the company. And that means they won’t come back. And that means your investment won’t come back to you either.
As a VC, you can drive better UX in crypto
The companies you choose to invest in matter. Because with each choice you make, you’re shaping the future of this space. If good UX is one of your investment criteria, then you’ll be helping to push for a more user-friendly crypto sector in general – because companies seeking investment will recognise they need to focus on UX if they want to raise funds.
So before you back a crypto firm, make sure they:
- Design for first-time users, not experienced crypto/tech minds
- Make information easily accessible to users before they ask for sensitive data
- Create feedback loops so users always know what just happened, and what happens next
- Make user-facing flows simple
- Test their products on users who are not crypto-native – and use their confusion as a roadmap towards clarity
The products and services that win large-scale adoption in this space won’t just be technically impressive. They’ll be the ones that are intuitive to use, trustworthy, and make every user feel like a crypto pro.
Mass adoption doesn’t happen if users are forced to get used to complex processes. It happens by building experiences that meet users where they are.
Have an idea for a topic you'd like us to cover? We're eager to hear it. Drop us a message and share your thoughts.
Catch you next week,
The LEAP Team
