We spoke with Alex Barnes, head of NFT product at Phantom, on what it takes to build a world-class NFT experience, and the impact Solana compressed NFTs will have on the space.
This interview has been lightly edited for clarity. Watch the full interview here.
Olly Wilson:
Today, we're going to be speaking with Alex Barnes from Phantom Wallet, to hear from her about crafting a world-class NFT experience, and also about one of the most exciting new standards in the space, namely compressed NFTs on Solana. Before we dive in, I am going to give a little bit of an overview of compressed NFTs and what they are.
Unlike regular Solana NFTs, the data for a compressed NFT is mostly stored off-chain, within a structure called a Merkle tree. Hence the "compressed" part of it - the compressed tree structure is what allows you to basically have more efficient storage and still verify the contents of a much larger data structure.
There's a lot of technical effort that's gone into actually developing compressed NFTs, and Metaplex has been the driver behind a lot of this. They have a ton of content online if you want to go into the technical details, but the most relevant thing that's quite interesting about them is just how much cheaper they are to create than regular NFTs - it's on the order of maybe a thousand to ten thousand times cheaper.
And as with a lot of other technologies where they rapidly become cheaper, you open up new possibilities. So people are excited about compressed NFTs because, if you're a brand, you might be able to do a wide-scale mint of ten million of them where you couldn't before. There's going to be a lot of other experimentation, and it's quite exciting to see because, of course, with the NFT space and crypto in general, a lot of the prohibitive-ness of it so far has been the cost of getting involved, whether it be gas fees or otherwise.
And when you're doing something on a really large scale, even if a network is relatively cheap like Solana, that cost adds up pretty quick and limits what you can do. So it's going to be really cool to see as the standard becomes more widely used, in terms of compressed NFTs, how that can actually help solve part of the puzzle for broader adoption.
But of course, to do all that, you need to still not just be focused on the technology. You also have to think a lot about the product experience. What are we delivering in terms of a user experience for NFTs? And so we have Alex with us here today, who leads Phantom’s NFT efforts. We're going to be having a conversation about how to think about not just compressed NFTs, but the NFT experience in general, and what's involved with that. So I'll pause a little bit there, but thanks again Alex for joining us. We would love just to hear a little bit more about your background, your career so far, and maybe some of your career highlights.
Alex Barnes:
Yeah, thanks for having me. I'm Alex and I've been in product since graduating from college back in 2017. I actually didn't know what product management was in college. I went to UVA in Virginia, and the program I was in was heavily geared towards finance, investment banking, and consulting. So, that's the path I thought I was going to take. I was pretty bad at finance, but I was slogging through it. I got an internship in New York to try and test out if I wanted to be in investment banking, and found it to be really stilted. I couldn't really vibe with the skirt suits that were required for that job, and it was not my vibe at all. Anyway, I got back to school after that internship and was like, "Well, shoot. I really don't like any of this stuff." Consulting seems a little bit soul-sucking too. Sorry if anyone does consulting!
Alex Barnes:
But then I saw that Twitter was at a career fair for marketing, which I was not particularly interested in, but I was like, "Okay, whatever, I'm just going to go and chat with them." I ended up somehow forging my way into an internship at Twitter, specifically at Vine. I worked sort of in this rotational program between business development, brought up a bunch of different things, and it was literally the last summer of Vine - it was 2016. They shut it down in like September of 2016. So I was on the tail end of Vine when Musically, which is now TikTok, was kind of blowing up. I thought we should compete with them, but Jack Dorsey just wanted to shut down the whole thing. So anyway, that was like my first jump into product. I did some of it over the summer and thought it was super interesting. It sort of blended a bunch of different soft skills. I don't really have any hard skills. It was a really interesting and fun way to think about problems, and I liked the entire vibe of working on a consumer tech product. So then I kept that going and worked in consumer retail tech, and also B2B SaaS for a number of years at a few different companies. Then I was introduced to crypto by my boyfriend, who was really into crypto. I was very skeptical at first and was like, "What the hell is this?"
Alex Barnes:
And then I was slowly kind of introduced over time and got really into it, and at that point I was sort of bored with traditional tech. I guess I mean a lot. The problems have already been solved. The patterns and things are sort of duplicated across different products. It's not - there's not as much just free space to think. And so I ended up applying to Coinbase and joined them. I worked on their NFT product, which is a whole other story, and was helping build out the transaction layer. So all the transaction stuff, which is really interesting and very fun. And so I was with Coinbase and then joined Phantom back in July last year.
Olly Wilson:
Very cool - can you tell us a little bit about what led you to join Phantom, and for those less familiar, who they are and what they do in the space.
Alex Barnes:
Yeah, so Phantom is a self-custody wallet. The goal and mission is really to make crypto safe and easy to use, so that it's accessible to everyone with the particular lean of being a self-custody product. So that's a really key part of what Phantom is, and if you're in the crypto space, you know kind of all of the tragedy that happened not too long ago with FTX, and kind of some of the dangers of centralization. So we're very much on the decentralized self-custody side. And what that means is we have to be, you know, cognizant of all the user experience aspects, the security. But ultimately we don't hold your crypto. We're just sort of a means or a facilitator for you to interact with it in the myriad of ways that you want to, and we're free. So that's a little bit about Phantom.
The reason I joined Phantom was that within like four months of being at Coinbase, I realized that I loved crypto, loved building in the space, but felt kind of contained. And that's not a knock on Coinbase. Coinbase at the time was a 5,000-person company, and it's really hard to move quickly when you're that big. Like there's just a necessary amount of bureaucracy that exists at a company of that size, and that's a really big constraint in a fast-evolving nascent industry like web3 / crypto. So I quickly determined that I wanted to move to a startup, and then it was about finding the right startup.
Phantom, once I became exposed to it, was like a no-brainer. I really liked being in a foundational product experience like a wallet, which is like the first experience as a user that they have, and sort of like the core experience that unites all of their crypto, wallet activity, and then the UX. And like the passion for the user experience that the Phantom team has brought and has built before I got here was so apparent, and I was really excited about being a very UX-focused PM. Whereas other wallets like MetaMask are developer-friendly, I found Phantom to be unique in its design and its user experience. So it was kind of a no-brainer, and the team is awesome. Our founders are like the coolest dudes.
Olly Wilson:
Well, I think you touched on some of these pieces, but I'm curious, what would you say are some of the biggest differences in terms of product management going from traditional tech to crypto?
Alex Barnes:
Yeah, so I mean, at least in the tech PM roles that I was in, and this is not to speak for everyone that exists, but in non-crypto, most of the hard stuff has already been figured out and you're basically just copying patterns, paradigms that other people have already done.
Whether you know, the original kind of the OG sort of developments that happened, or it's someone coming up with an innovation that you're then copying. There's not as much just consistent need for new thought. So you can make huge breakthroughs for sure, and like the world of Facebook, etcetera, but it's just a lot harder and it's a lot less of the day job. A lot of the day job in those roles is optimizing existing experiences, whereas crypto is very much building everything more or less from scratch. I mean, some patterns exist that often suck. I mean, I don't know if anyone (listening) has ever bridged an asset, but it's horrible and there are similar things where you're just like, Oh my God, like we need to make this way better right now.
And I love that about it. Like, there's very little that we do on a day-to-day basis that's like, "Oh yeah, obviously, do that. That's the right answer." Much of it is, "Okay, how do we do this? How do we get the right data? How do we show that data? How do we build the right experiences for the user? How do we give them enough information about the transactions they're going through so they feel safe, but also abstract away some of the complexity?" Like all of that stuff kind of hasn't really been figured out. So it's really interesting from my perspective.
Olly Wilson
It sounds like you're dealing with a much higher level of ambiguity and uncertainty?
Alex Barnes:
Yeah, for sure, there is definitely a higher level of ambiguity. A lot of it. You know you can't lean on like, oh, this is what the industry titan does like. We should just do that because they've researched it, or run all these focus groups and they know that's the right way to do it. You're kind of: all right - I think this is probably the right answer. This is my opinion. What do you guys think? It's very collaborative. I also really like how collaborative it is between product, design and engineering. We all really are working together and often – it's like hey, here's my idea. Is this even possible? And then engineering investigates, and it's a really fun working environment as well.
Olly Wilson:
That resonates a lot. Maybe we can dive a little bit deeper into NFTs specifically. I mean, NFTs have obviously been one of the, at least in the recent bull run and the subsequent bear market, one of the areas where there's been the most innovation and hype and excitement in equal measures in the space, and it's still moving fast even with all the new standards that have been released. Even during this bear market, people are still building. There's a lot, just a lot going on. How do you think about developing a great NFT experience and choosing what to prioritize, what's important, and building up something that users will really love?
Alex Barnes:
Yeah, I think generally there are three main areas that I think about a lot when it comes to NFTs. The first is that so much of what is discussed from a product perspective regarding NFTs is people who already have NFTs. People who are already into NFTs, and they're trying to find their new NFTs. They're trying to interact. They're trying to use it for something. But we very seldom talk about how people who are interested in NFTs but don't have any – how do they get involved?
It is a really daunting process, and you have another human basically to walk you through what you're doing, what projects to be interested in, like how to vet things, whether it's through Twitter or Discord, what to buy, what marketplaces to use. Like, it's a really daunting experience, and we don't often think about it.
So that's something that I want to be thinking about more. The second is just the two-sided marketplace aspect of NFTs. Yes, there are the holders, but creators are incredibly important, and having creators feel like the end-to-end experience of where their NFTs are being held by their holders is a place that can augment their community or augment their kind of communication channels is also really important and something that doesn't really exist today. Well, kind of just like a repository for NFTs, but there's little interaction between a creator and their holders. All of that is happening on third-party apps and depths.
And then the third that I'll probably just expand on more, I guess, is just the level of fragmentation in the space. It is really difficult as a holder, whatever your purpose, whether you're flipping for investment, whether you're in it for the art or you're in it for the community. Piecing together all the different places and data and interactions that you need to take in order to find a project, interact with a project, flip a project, is a lot of work. And really, in my view, the wallet should basically be the foundational experience that unifies all this stuff for you. So it's not to say that the product experiences of Discord or Twitter or even marketplaces, but that we bring together all the key pieces of information so that when you view your NFT in your wallet, you're like, "Okay, yes, this is my central hub. I understand everything that's going on. This latest update is out, and I need to go here, I need to do this." And that doesn't exist, and I think that that's a really important piece of the puzzle to take NFTs to the next level. You know, we'll talk about compression and what that will open up from a product experience. There has to be a more unified way to interact with them, which just currently exists. So yeah, that's what I think about a lot.
Olly Wilson:
There's something interesting you touched on. Obviously you are designing for a lot of users who never have had NFTs, and are maybe new to the space. But then I think you also have to consider the folks who have a thousand or ten thousand, a hundred thousand NFTs also, and how do you think about developing both experiences?
Alex Barnes:
Sure, this is something that I champion at Phantom – which is the importance of building for whales. They are a very small portion of our total users, but they account for a very outsize portion of transaction and activity volume, so building for those individuals is incredibly important. I think they are also, not only the ones that are driving the largest share of transactions but also the ones that are most likely to be at the forefront of any kind of innovation. That's because they're the most tuned into the ecosystem. They're keeping tabs on it in a way that, like everyday, users just don't have time to do or aren't interested in doing. And so I think it's both capturing the transaction volume that we want to capture, but it's also having the cohort of users using our product that are pushing the envelope and forcing us to push the envelope too.
And the largest challenge with Phantom and most wallets is building something performant, just simply dealing with the sheer number of tokens that we have to hold for them that we have to store for them that they have to be able to view and interact with. We're working to improve that rapidly, but it is just very critical to build for these different personas, and honestly, the way we prioritize is generally like. What is the effort versus impact? And so well, are a key place where like you could look at them and say Oh, the overall user numbers are small, but the impact to you know, transaction volume to the ecosystem, to the progression of NFTs in general is very outsized, and so this really is an important part of the puzzle. A similar calculation could be done between developers and consumers – like there aren't nearly as many developers as there are consumers, But you want to build a good experience that developers can use and build products in so that they then you know, want to use Phantom. Their holders want to use Phantom. There, people that are using their project want to use Phantom. It's kind of like you have to build a pretty holistic experience to capture all of these things.
Olly Wilson:
Yeah, agreed. I imagine, also not just proportionate in terms of transaction volume, but also probably in terms of giving you feedback as well.
Alex Barnes:
Oh yeah, for sure, yeah, I mean, you have someone using the product every day, sometimes multiple hours a day. They're going to run into a lot more issues and they're just going to be more vocal. I mean, those are the users that we see in our beta. Now they're incredibly vocal, but it's really helpful to have those people because you know you find the issues in your product very quickly that way.
Olly Wilson:
Yeah, awesome. Well, switching gears again about compressed NFTs. I’m curious – what was it that led you to want to prioritize support for compressed NFTs?
Alex Barnes:
Yeah, so we're really excited about compressed NFTs. I’m excited for the entire Solana ecosystem, because we think it will lead to significantly increased adoption of NFTs. You touched on this earlier, but we've seen you know small creators – people who have come up in the space who've gotten really big, and NFTs projects who've experimented, but we haven't seen the level of experimentation from large enterprise players.
Alex Barnes:
I mean, there's all kinds of big web2 companies that love to talk about NFTs, and use it as a marketing pitch. They actually built anything yet, and I think a large reason why they haven't built anything is because to experiment at scale is really expensive even on Solana, which is a cheap network, but like it's actually quite expensive for any large scale mint and maintenance of a collection. We're talking like an Instagram level type of thing, And when you have millions of NFTs that you want to enable, it’s just cost prohibitive to really experiment at this point like you can't really fail fast. They're not approved through any sort of budgeting process. So if we want to enable all kinds of new experiences with NFTs, whether it's ticketing or integration into social media or gaming, there has to be a way for it to be cheaper over the long term, and also just to be cheaper to test whether it would resonate with their user base. So yeah, I think compression is probably the best step forward in terms of onboarding big web2 companies into the space and giving them an access point, so we're really really stoked about it.
Olly Wilson:
Yeah, that makes total sense. Curious - how do you actually think about integrating it into the product experience going forward? Can you share?
Alex Barnes:
Yeah, so the cool thing about compression is that to the end-user, it really is no different. Like the NFT itself doesn't look different. It doesn't act differently. It's just the back-end storage portion. That being said, I think where integrating can be more of a point of conversation is if compression unlocks these different use cases that large-scale mints could support, things like ticketing, or gaming, then those experiences need to be supported within Phantom. And today, we really hold NFTs as very much a collectible. That is how it's viewed. That's how we build products around it. That's the kind of paradigm in which we think of them. And if compression opens up new use cases that deviate from that, then we will obviously respond. So it's more about us doing the front-loading work of thinking about what are the use cases that compression could open up? How would we have to pivot in these cases, which we've been thinking about and then waiting for the market to evolve to that? Like we're not going to build a new product for ticketing if ticketing doesn't exist, but when it does, we will respond, type of thing.
Olly Wilson:
Some of your hypotheses you mentioned, such as ticketing, web2 brands edging into the space – what do you think maybe that will be enabled by compressed NFTs or some of the things you can see happening over the next six to twelve months in terms of experiments?
Alex Barnes:
I see the possibility of some loyalty concepts moving to NFTs? You know whether it's Instagram, rewarding usage or some kind of badging, similar to what Reddit has done and done rather successfully, or Starbucks and their loyalty program. I almost see like the initial levels of experimentation being a little more like gimicky, in that way – existing products that these companies already have, and just being like no, it's an NFT, and seeing how it resonates. Where I think where we'll see more interesting innovation is potentially on the gaming side of actually supporting larger scale like utility, NFTs, and gaming. If you look at the last two months, one of the biggest web3 games has been Dooky Dash from Bored Apes. It’s a game that was created by an NFT project that has nothing to do with web3. Like the game is super fun. I loved playing it.
So part of the evolution of the onboarding ecosystem has been, they released sewer passes, which are NFTs that grant you access to playing this game called Dooky Dash, and you're supposedly in the sewers of the Bored Ape Club and you're trying to survive as long as possible. It's like a very simple game that is really addicting, and based on your performance you are given a rank, which is an NFT, and then it will evolve over time. I think it's going to turn into some kind of power source you can pair with your ape.
So anyway, it was a game, a very addictive game, but it had no actual web3 elements to the game Like it was just a game, a web based game that you played. and I think the point is like, there's clearly an interest in gaming, but right now the actual use case can't be supported because like running a game on ethereum would make it horribly slow and not very fun. So there needs to be other innovations. And my point is compression, new standards, new ways to both reduce storage and speed up performance will unlock a lot of these things.
Olly Wilson:
It's not just because of the tech in of itself.
Alex Barnes:
Yeah, exactly exactly, and like there's, I guess my point is like there's clearly a market there for it because people are playing this pretty simple game. and if it was enhanced through actual web3 technology, I think it would take off even more.
Olly Wilson:
On a related topic, other players in the space, like Reddit for example, have shied away from the term NFT – they’ve gone with “collectible”, and actually, that's the term I think Phantom often uses as well. Do you think for mass adoption, we need to shift away from the term NFT? Or if it needs to be different terms for different use cases?
Alex Barnes:
Yeah, I think crypto and NFTs are in a really funny situation where, for some reason, we've imbued the back-end technology that supports these things into the marketing of it, which has never been a thing that we ever do for any other technology. Like no one cares what the back-end is, how it's powered.
So to me, it's just a bunch of nerds trying to interest other people in technology, and the average person doesn't care. They're like, "Well, what can I do with this? Why is it interesting to me? What does it allow me to do that I couldn't do before?" So yeah, in my opinion, I don't really care about the terms or the name changing so much, but I do think it's interesting that these large companies are kind of pivoting away from that, and I don't really see the marketing value.
I think there's a mix, like last year there was just such a fight around the term NFT. It was like the most used term of 2021 or something that people were jumping on the bandwagon simply because it got them coverage in the news cycle, but yeah, I could see there needing to be a pivot away from it and just focusing on the end-user experience as well and what that unlocks for them.
Olly Wilson:
Any other exciting projects obviously, other than Phantom in the space right now, or maybe a favorite NFT collection that you're pretty excited about?
Alex Barnes:
Yeah, so I mentioned Bored Apes. I mean, I know people always hate on them, but I just respect the hell out of that project. In general, I mean, they've been able to kind of grow their ecosystem, and create a crossover with traditional gamers.
An interesting new project that I've come across is this "Checks" project, which was basically born on Ethereum. It was born out of Elon Musk changing the requirements for getting a checkmark on Twitter to just being a paid option, and it was, I think, originally started as a commentary around the status of a checkmark and then what that means when you can purchase the checkmark. Like being able to purchase status, and this guy created a bunch of these checkmarks. They sold out very quickly. Each of the original mints was eighty, and then he started playing around with game theory like, "Okay, can I make the rarity around these things much more valuable by allowing people to burn them and convert them?" Based on what they burn, they convert them into more rare versions of the original. I think it's like you take two of the original eighty checkmark mints, you burn them and get one forty checkmark mint, and then you can keep doing that. So I burn two forty checkmarks, and you get one twenty, and then you get. It keeps going down the list until you get to one. And so I think I just really like seeing when projects play with new ways of trying to incentivize interest. And it's not even utility at this point. Like we're still not there, but it's just really interesting to see how engaged and get their community based on kind of coming up with these interesting ways of creating engagement or scarcity or rarity, things like that. So it's been really fun to watch that, and I think it's just a really innovative project.
Olly Wilson:
That's also something I’ll have to take a look at. Ok shifting a little bit - for people who are looking to move into product in crypto / web3 for the first time - what advice would you give?
Alex Barnes:
Yeah, product is a really annoying career path in that, it's very chicken in the egg like no one wants to give you a product job unless you had a product job. Because it's really hard to test for in an interview. What are you asking? Like what have you built? You know? Random, sort of soft skills, unlike engineering, where you can just see if someone is good.
So it's hard to break into, and I think a lot of people have struggled with that in the last five years or so as product became more of a popular career, the fact that crypto is so new and the premium on web3 knowledge is so high because of how few people actually know anything about it, that it's a rare opportunity where at startups, you can probably get a PM job in web3 if you have the web3-side experience, which just requires that you spend a lot of time on Twitter. Honestly, though, it's a unique opportunity that probably won't last that long, because eventually that knowledge will become much more disseminated, and there'll be less of a premium on it, so there will be more need for hard skills or the experience of being a PM. Whereas now, I think it's really just like an open field.
Olly Wilson:
So we’re nearly at time – if people want to learn more about Phantom where should they go?
Alex Barnes:
Phantom.app! Or the app store.
Olly Wilson:
Alex, really appreciate it, thanks so much for joining today.
Alex Barnes:
Thanks!
