New Solana Crypto Phone Launch: Bullish or Bearish?

On the 13th of April Solana (SUN -1.42%) hosted a launch event in San Francisco for its highly anticipated Saga mobile phone. This “cryptophone” is the first of its kind for a major cryptocurrency and is part of a broader push to make the Solana blockchain the premier home for mobile crypto experiences.

So how much of an impact will this Saga phone have on the future price of the Solana? It really depends on how you view the future of Web3, crypto and mobile. In a best-case scenario, the launch of a physical hardware product could send Solana’s price skyrocketing.

The bullish case

Before the Saga, no mobile phone was optimized for crypto or Web3. That’s basically the problem Solana’s new Android-powered Saga phone is trying to solve. The new Saga boasts innovative technology that today’s mobile phones don’t have, such as a new seed vault to hold cryptographic seed phrases.

This new security feature means Saga can become your digital hardware wallet for crypto and crypto-assets such as non-fungible tokens (NFT). It’s something crypto enthusiasts have been asking for for years. After all, if you take your cell phone with you everywhere, doesn’t it make sense that you should also take your crypto wallet with you everywhere?

Image source: Getty Images.

The new phone will also make it possible to create completely new types of user experiences that are currently impossible with current technology and business models. The Solana team showcased some of these Web3 experiences during the launch. For example, a new messaging app for Solana will enable the sending of “smart messages” (messages that include executable smart contracts) and “NFT chat stickers” (stickers that are actually NFTs from creators within the Solana community).

When you put all this together, mobile can be a very compelling business strategy for Solana. Once you put a hardware phone in users’ hands, you can create end-to-end customer experiences, all enabled by a digital wallet native to the Solana blockchain.

Solana now has all the working pieces of a mobile ecosystem: the Saga phone, a new decentralized app store for Web3 apps, a mobile payment system called Solana Pay, a Solana mobile stack for developers to build new experiences, and even a new decentralized wireless network for Saga that will pay users in crypto for operating 5G hotspots.

The bearish case

The downside, as I see it, is that the launch of this new crypto phone sounds great to crypto enthusiasts, tech early adopters and young members of Generation Z who grew up as digital natives, but what about everyone else? Let’s be clear here: Are most people going to pay $1,000 for a new crypto-enabled Saga phone when they already have a $1,000 phone from a company that apple or Samsung?

During the nearly hour-long Solana launch event, there was no mention of pre-sale order numbers for the Saga, and I believe there was a reason. This could end up being a very niche product.

Also, there is the question of how many decentralized apps (dApps) will be available in the new Solana app store on day 1. During the presentation, Solana referred to this app store as “an experience distribution machine”, so having enough new apps (i.e. experiences) you simply don’t get on any other phone today will be important. These new types of experiences can convince people to switch phones.

An example given during the presentation was an app that allows you to create a new NFT by taking a photo with your phone’s camera. It might be interesting because the process of minting new NFTs with a camera is currently out of reach for most people. Another example was an app that forces you to pay with Solana tokens from your digital wallet when you exceed your allotted cell phone screen time for the week. (The perfect app for parents with children!)

Should you buy Solana?

Overall, I’m positive about Solana. And I’ve been bullish on Solana going all the way back to the earliest announcements of this new crypto phone. To me it makes perfect sense that the future of crypto is mobile and that there should be mobile phones optimized for crypto. But does the rest of the world agree?

I look forward to all the potential synergies possible with the launch of the new Saga phone. If that leads to the blossoming of a Solana mobile ecosystem, that would be huge. There is simply no other blockchain that can duplicate this right now. Solana has come a long way in a short time and I am excited to see how well the team at Solana can execute this product launch.