2 min read

The Weird Chicken & Egg Problem With New Users On Ethereum (Needing ETH)

The Weird Chicken & Egg Problem With New Users On Ethereum (Needing ETH)

TLDR: People who make new accounts on Ethereum often will not understand that they need to "seed" their account with ETH. They don't know how to do this but also why they need to do this. What is ETH even used for? We highlight the rainbow wallet as they introduce an Apple Pay option for users which allows them to easily pick up some ETH to start playing with. In the end, users just need to know their options and have them presented to them in an understandable way.

So what's the chicken & egg problem?

It's this. Whenever a new user creates a wallet, maybe with metamask, they are left with an Ethereum account but NO ether token to pay for gas.

This is confusing...

"I made the account, but I can't do anything with it."

Normally, you would make the account and expect to have full access to the service you are using. But...

You make an "account" or wallet and you can't actually do anything.

The wallet doesn't seem to tell you what to do next and it leaves users feeling beyond confused.

Why Is This Confusing?

Put yourself into the shoes of a new user. You may have never interacted with the blockchain before. You don't KNOW that there is some cryptocurrency thing you need in order to actually make things work.

You aren't explicitly TOLD that you need to somehow procure some of this cryptocurrency...

But when you figure it out, you realize that this is no small feat.

You only wanted 1 Ethereum account but you ended up having to go to a service called a CEX (Centralized Exchange) like Coinbase or Kucoin. So now you have 2 accounts and 2 onboarding processes to go through.

But here's the NEXT problem. How does Coinbase work? It looks like this will be hard to set up.

Then we lose that user.

This seriously blows.

Just Tell The User Before?

This is the problem...

If we could somehow tell the user before they create a wallet that they should create an account with a CEX, or better yet. Integrate a FIAT onramp in the wallet itself so that users can just pick up some ETH there.

Rainbow Wallet has this feature but it may not work in certain countries, like Canada where credit card providers won't allow people to use their credit to purchase Crypto.

Another good option is the use of Apple Pay. The rainbow wallet uses this.

The point is: let's give people options.

Create awareness around the practicalities of exploring web3...

  1. https://rainbow.me/ (Rainbow Wallet)