On a recent episode of Laura Shin’s Unchained podcast, Ledger co-founder and CEO Eric Larcheveque revealed his company sold half as many hardware wallets in 2018 as they did in 2017. Ledger’s sales have declined with the market, as bitcoin prices are still down over 80% from their all-time highs, which were made in December 2017.
Ledger Sales Decline with the Crypto Asset Market
According to Larcheveque, Ledger sold around a million hardware wallets in 2017 and roughly half a million hardware wallets in 2018.
“And we sold a lot of the devices in the first quarter of 2018,” added Larcheveque as he shared these numbers with Shin.
Larcheveque went on to explain that their sales tend to correlate with the level of coverage related to bitcoin and other crypto assets in the media.
“When the price is going down, the interest in crypto is going down,” said Larcheveque. “And also, the media coverage is going down. And so, generally speaking, the traffic is going down, and so we sell less.”
Although the connection between a crypto asset bear market and weaker sales numbers for Ledger may be obvious, Larcheveque noted that they also tend to see an uptick in sales when there is a sudden crash in crypto asset prices.
From Larcheveque’s perspective, Black Friday sales are the best metric to track when comparing numbers from different years. Without getting into specifics, Larcheveque stated, “Black Friday in 2018 was very good compared to 2017.”
Secure Smartphones a Threat to Hardware Wallets Going Forward?
On a related note, Larcheveque was also asked by Shin whether Ledger views the use of secure enclaves in smartphones as a potential threat to their business model going forward.
“They are more like an extension,” responded Larcheveque.
Larcheveque thinks it will take another three years for secure enclaves to be ready to complement the hardware wallet industry.
“Right now, there is a lot of fragmentation. It is quite complex to use it consistently on different types of platforms or smartphones,” said Larcheveque.
According to Larcheveque, Ledger will be more than ready when it’s time to move to secure enclaves, which is when they’ll be able to profit from their technology through licensing deals with phone manufacturers who provide devices to billions of people around the world. The company originally launched their own wallet for secure enclaves in Samsung phones back in 2016.
Of course, the market for hardware wallets won’t disappear overnight, so Ledger should still be able to sell their traditional cold storage solutions for quite awhile.
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