If we’re going to educate the locals about setting up a lightning wallet, we first have to decide which mobile wallet to use (and educate ourselves). During the exploration phase we had a look at the Muun wallet.
UPDATE: In the fast-moving world of lightning, this page is already out of date. After failing to find a quick solution for onboarding new users; we have since changed our minds about custodial wallets; especially when dealing with small amounts. The first step is for users to learn how to send / receive, then on-ramp / off-ramp, then once they feel more confident, the next step is self-custody.
What we liked about Muun was, it had a simple way of displaying the balance in both SAT and a local African currency. Keep in mind that the conversion rate between USD and some of these currencies is in the thousands, so SATs actually “look better”, at last from a psychological point of view. Coincidentally in the current market cycle, the rate of one unit of the local currencies against one SAT is within a single to double-digit range. This makes it easy for someone to convert SATs in their head when making purchases, even though the local currency equivalent is displayed as well. No trailing decimals appear as well which makes the UI nice and clean, unlike other platforms which just look weird and confuse the brain as 4 or more decimals don’t add any value to such small amounts. Over time, the weight of the SATs will get closer and closer until the point where they eventually surpass the local African currency. This actually already happened during the last cycle to some of them. Something that will probably never happen to the US dollar.
Imagine how interesting it would be if one year later, the shop owner we started with suddenly notices that they are getting a lot fewer SATs for each transaction of the same goods than they used to, even though they are requiring more of the local currency. Now that would be the right time for the inflation discussion, as they would have something to compare with (e.g. SAT vs X currency — for a bag of sugar/corn/rice). Human nature dictates that the incentive changes from frequent converting to saving as they notice how the SATs not only retain their value but increase it over time.
Everything (including the exchange rate) impacts user experience
What could help our cause right now is the volatility of the exchange rate (not to be confused with value) vs fiat remaining relatively stable. The goals of some “investors” (from the west and other developed regions) in the underlying protocol are “number go up as fast as possible”. This is actually contradictory to the goal of using SATs as a medium of exchange. Sure, ‘number go up’ gradually over time would be fine, but NOT these massive boom/bust cycles. Amazingly, volatility levels are now lower than they have been for over 2 years (at least at the time of writing). It’s almost turned into a stable-ish coin. Terrible for traders, but wonderful news for those that want to see Lightning succeed. Perhaps, tighter monetary policy is good for this space after all, since having lots of traders attracts companies like that infamous offshore one which recently closed its doors for good. Well, good riddance to bad rubbish. Game theory will work things out for the best. If the goal is to get worldwide adoption, then a relatively stable exchange rate might help.
On Muun’s website, they write about self-custody and how they want to move away from Mnemonic phrases. So we tested it and noticed there was a backup to email (wallet recovery), then an additional ‘alternative backup’ of a ‘code’ to be written on paper, and finally an emergency kit PDF stored in the cloud.
This would have been simple if we were sitting in a western country with high speed internet + Google Drive cloud backup and lots of other resources. The reality on the ground in an African Village is completely different. With Mobile Money, all they need to remember is a PIN for their account, nothing more. There is no cloud storage and definitely no organised place to write down anything on a piece of paper that can be reliably stored for the foreseeable future. So we really need to think about ways of keeping things super simple (at least during the initial stages) otherwise we’ll just get stuck and there will be little or no adoption of lightning in the communities where it’s needed the most.
SATs are worth more than gold
To summarise; understandably, self-custody is one of the most important lessons about this new type of money. This is what makes it more valuable than gold because it eliminates counter-party risk. Unseizable money. However, the technical complexity around nodes, wallets and multiple layers in the network is something that only younger, more tech-savvy users who have access to computers and live in the city can manage. We see this as a “trade-off” ladder, you start at the bottom and then move your way up as your knowledge of this space becomes more comprehensive. For example, educating people on how to avoid scams is a lot more important than self-custody (initially), because scammers are always looking for new victims.