The industry’s new problem is not construction, it is customers
The crypto industry has spent the better part of a decade building. Firms have laid down blockchain infrastructure, tokenised funds, expanded exchanges into lending and payments, and courted institutions onto their networks. Now, according to executives across the sector, comes the harder part: getting people to actually use these products, and then getting them to keep coming back.
The shift in emphasis is becoming more pressing as crypto moves closer to mainstream finance. Asset managers have tokenised funds sitting on chain. Exchanges are broadening out from trading into a fuller suite of financial services. Blockchain networks are pitching themselves to institutions that once would not return their calls. The challenge is no longer proving that these products can be built. It is figuring out what will make consumers and institutions choose to use them.
Ben Shen, Coinbase’s head of financial services and loyalty products, said the industry’s historical orientation is part of the problem. “The crypto industry oftentimes in the past was very technology oriented,” he said. Products could be heavy on jargon, or expose users to the technology running underneath them. That matters less as crypto starts to overlap with traditional financial services. Customers want to grow their money, hold it, send it, spend it or borrow against it. Whether a blockchain sits underneath the product is not necessarily the point.
Coinbase and the adoption flywheel
Coinbase is approaching the problem by thinking less about the technology itself and more about what customers are trying to do with their money. Shen described what the company calls “magic moments” — instances when a customer can immediately see why a product is useful.
Getting someone to try a product once is only part of the battle. Coinbase frames adoption as a cycle: money comes onto the platform, customers have a reason to hold it there, and then they have ways to use it. That could mean receiving a paycheck or making a deposit, earning rewards while holding assets, and eventually spending, trading or making payments with them.
“If you create the right magic moments across these three parts of the flywheel, then that’ll get people to increasingly bring more and more money onto the platform,” Shen said.
Rewards are one way to get the cycle started. Some are built into the product itself. Others are temporary incentives designed to persuade someone to move money from a product they already use. Those can help “break inertia,” Shen said. But Coinbase does not want someone to move money onto the platform for a promotion and pull it straight back out when the promotion ends. The bet is that once the money is there, customers will find other things to do with it. Someone might initially come for a yield incentive, then use the same assets to trade or spend.
There is a social dimension to this as well. Financial services depend heavily on trust, Shen said, because people are handing over their money, sometimes their paycheck and savings. Hearing that someone else has used a service and found it reliable matters.
“There’s like a social proof thing for financial services that is important,” he said.
That observation cuts to the heart of why adoption has been slower than the technology might suggest. Crypto firms are not simply competing with other crypto firms. They are competing with banks, payment apps and brokers that customers already trust with their salaries. Word of mouth in financial services is earned slowly, and lost quickly.
“Show me adoption”: the institutional version of the same problem
Kevin O’Leary, the Shark Tank investor and chairman of O’Leary Ventures, sees a parallel problem playing out among the blockchains themselves. Speaking at the Avalanche Summit in New York, O’Leary said networks looking for institutional business need to show that companies are actually using them, not merely testing them.
“The challenge you have is ‘show me, show me adoption,'” O’Leary said. “The merits of that chain are well understood for those technologists and S&P 500 companies that understand why that’s important in building capacity and not being concerned about transaction volume. I get it, but what I want to see, and everybody else, and which is why they call it work, is you got to get some deals, and you got to get adoption, not just tests.”
His argument is that technical merit alone does not close institutional deals. Large companies understand why blockchain capacity might matter, but understanding is not the same as committing. What moves the needle is evidence: signed deals, live usage, real volume from recognisable names.
O’Leary also noted that one big customer can make landing the next one easier.
“The most powerful marketing tool of technology is word of mouth between competitors,” he said.
That dynamic mirrors the consumer side. Whether the customer is a household or a Fortune 500 company, the underlying question is the same: who else is using this, and did it work for them? For blockchain networks that have spent years on testnets and pilots, the pressure is now to convert experimentation into reference customers.
Taking the product to the customer: WisdomTree’s distribution play
For some firms, adoption means putting products where customers already are rather than waiting for customers to come to them.
WisdomTree, the $150 billion asset manager, has built a suite of tokenised funds, including WTGXX, a tokenised money market fund with about $1.2 billion in assets, according to Will Peck, WisdomTree’s head of digital assets. Now the firm wants to get those funds onto more platforms.
“You don’t need to just come to WisdomTree,” Peck said in an interview. “There’s going to be other access points that you can go through, where you’re effectively coming to WisdomTree, but through a different front end.”
WisdomTree recently announced a collaboration with MoonPay that will let eligible U.S. retail customers access WTGXX through MoonPay’s platform. Customers who have already provided their information to MoonPay can buy the fund using stablecoins without separately onboarding with WisdomTree, Peck said.
The arrangement is notable because it removes one of the most persistent frictions in crypto finance: the onboarding process. A customer who has already verified their identity with MoonPay can gain exposure to a tokenised money market fund without repeating the exercise with the asset manager. That is precisely the kind of “magic moment” Shen described, where the usefulness of the product is immediately apparent and the underlying technology stays out of the way.
MoonPay is not meant to be the only place WisdomTree’s tokenised funds appear. The firm’s stated intention is broader distribution across multiple front ends, treating the tokenised funds less like a destination product and more like something that travels to wherever the customer already does their financial business. Coinbase is likewise thinking about how its products can reach customers outside its own platform.
The distribution question is arguably as important as the product question. A tokenised money market fund with $1.2 billion in assets is a genuine achievement. But if it is only reachable through a single onboarding path, its addressable market is limited to those willing to take that path. Embedding it in existing platforms multiplies the number of touchpoints without requiring the customer to change behaviour, which is the single biggest predictor of adoption in consumer finance.
What this means for the market
Taken together, the comments from Coinbase, O’Leary and WisdomTree sketch a coherent picture of where the industry now finds itself. The build phase, at least for the core financial primitives, is largely done. Tokenised funds exist. Exchanges offer lending, payments and rewards. Blockchains can settle institutional volumes. What separates the winners from the also-rans in the next cycle will not be technical capability but distribution, trust and habit formation.
For investors, that reframes how to evaluate crypto-linked equities and networks. User growth, retention and the quality of partnerships are becoming better signals than product announcements. A network with signed institutional deals is, on O’Leary’s logic, worth more than one with a superior test environment. An exchange with a working adoption flywheel, where money arrives, stays and gets used, has a more durable revenue base than one dependent on promotional inflows that reverse when the incentive ends.
The regulatory backdrop reinforces the trend. As crypto products look and behave more like traditional financial services, they will be judged by the standards of those services: reliability, recourse and trust. Firms that internalise this early, by hiding the technology and foregrounding the outcome, are better positioned for the mainstream phase of the market.
The uncomfortable conclusion for the industry is that the hardest engineering problem was never the blockchain. It was human behaviour. More on that theme in our DeFi coverage.
