Fintech

Meet the Apple veteran building Square’s bitcoin wallet for the masses

No, it's not Jesse Dorogusker. Thomas Templeton, who followed Dorogusker from Apple to Square, is working on a key crypto project for Square.

​Thomas Templeton, Square's hardware general manager

Thomas Templeton is Square's general manager for hardware.

Photo: Square

The Square executive leading Jack Dorsey's big plan for a bitcoin wallet is a veteran hardware technologist with a quirky hobby: taking pictures of countertops.

"My wife gives me a hard time because my camera phone is full of baby pictures and countertops," Thomas Templeton, Square's general manager for hardware, told Protocol.

Templeton takes photos of countertops at coffee shops and stores where he gets fresh ideas for improving Square's ubiquitous point-of-sale registers. The practice, he admits, is "a little weird" and typically prompts a shop owner to ask: 'What are you doing?'"

It's a good question for his new challenge, too, which is something harder to capture in the wild: making a hardware device that safeguards the private keys used to unlock cryptocurrencies. Right now, it's a niche product category that caters to the most hardcore crypto HODLers.

But it's one of several bitcoin-related bets Dorsey is making to solidify Square's role in the crypto world — and that makes Templeton's job, which is to make the device appealing and user-friendly to the same kind of people who trade bitcoin on Cash App, all the more crucial.

That could mean a lot of conversations with bitcoiners, just like Templeton chats up Square merchants today.

"I talk to them and say, 'Your setup is a little bit unique and I'm taking it back to the design team,'" he said. "Every business is different. If you think about countertops — there are some really deep countertops, some narrow countertops, some really high ones."

That same wild diversity can be found in Square's target market, which Templeton acknowledges is complicated. Jesse Dorogusker — Templeton's boss, whose portfolio now includes both hardware and the Tidal streaming service — said the plan is to "to make bitcoin custody more mainstream." But some people buy bitcoin as an investment, some use it to hedge against unreliable local currencies, some speculate and some just see it as a glimmer of the world's financial future.

As Dorsey's profile in the crypto world has grown, so has bitcoin's importance to Square. Bitcoin revenue tripled year-over-year to $2.7 billion in the second quarter when it made up more than 40% of Square's total sales.

Crypto wallets, which are typically small USB-drive-like devices, are popular among retail crypto holders who want to make sure their assets don't get hacked. It's currently a niche market, valued at $202 million in 2020, but growing fast along with the value of cryptocurrencies.

Chris McCann, a general partner at Race Capital, a venture capital firm which has made crypto investments, said "it's hard to see how hardware wallets would be a material revenue driver" for Square in the near term. But he called the company's move "a hugely positive and exciting step for the ecosystem" and a way for Dorsey and Square to "expand the market much broader than what it is today."

Square's objective, Templeton said, is "to bring bitcoin [wallets] to the masses, to the next 100 million people around the world," adding, "We believe bitcoin is for everyone."

He said he's in the process of building the wallet team, which already includes hardware security lead Max Guise, whose name is on several patents related to physical unclonable functions, a key technology. Templeton declined to discuss details of the plan so far, saying they're early in the process.

But it's clear from what Dorsey and Dorogusker have said that the goal is to come up with an easy-to-use mass consumer product with broad appeal. "The more seamless the experience is, the more people will try it," McCann said.

The ideal would be what Apple accomplished with products like the iPhone, the investor added: "Marrying the best of hardware and software into one package would greatly help self-custodianship."

Templeton certainly understands the challenge — and that comparison. Before joining Square in 2011, he was part of the Apple team that helped develop the iPhone camera. (Dorogusker, who joined Square from Apple shortly before Templeton, served as a director of engineering at the tech giant.)

Templeton joined Square when its hardware team "was still pretty small," and they developed what he called a "really iterative process."

"As soon as we have a product, there are a million things I want to change about the product for the next version," he said. "As soon as you ship [a product], you're already going, 'Oh, my god. I wanted to change this. I wish we did that. This wasn't enough."

His habit of taking countertop photos is part of his process of figuring out ways to make Square products easier to use. "We want to be as frictionless as possible," he said."How can we provide tools that are flexible enough, where they don't have to rip out their countertop or change their setup to use Square?"

Templeton said his team was constantly making tweaks to the point-of-sale lineup, like adding an extra screen or changing the aspect ratio to cut a second or two in the payment process and make life easier for customers and staff.

"Seconds might not seem like a big deal, but when it's rush hour, those seconds add up," Templeton said.

The challenge, though, isn't to just design a beautiful device. It's making sure it can be manufactured — thinking about "tolerances," or how much variation is acceptable as product after product comes off an assembly line.

Before Apple, Templeton worked in the chip industry as a staff engineer at Xilinx.

"I spent a lot of time in factories early in my career and those helped, and I do think those helped when designing products," he said.

"Designing for high volume is different from designing for dozens or hundreds or thousands of units," he added. "I'm designing to make millions of these. How can we design something and be able to make it scale?"

To get answers, Square is doing something that would have been all but unthinkable at Apple: It's reaching out to the bitcoin and crypto community, including hardware makers it may even end up competing with.

When he unveiled the plan on Twitter, Dorsey said Square wants to "build it entirely in the open, from software to hardware design, and in collaboration with the community."

That's not just for show: Guarding the device's secrets closely would just generate suspicion in a community used to verifying every transaction out in the open on the blockchain. Just as blockchain protocols are published openly in white papers, it's likely at least some more sophisticated buyers of the hardware wallet will want to inspect its specifications and understand its security.

And looping in key players could generate goodwill. Crypto marketplace Coinbase chief product officer, Surojit Chatterjee, welcomed Square's move.

"It's great to have more mainstream companies coming into crypto," he told Protocol. "It makes the crypto pie bigger and bigger, and brings more users to the crypto economy."

Square's aim, Templeton said, is to grow what is still a relatively small and limited market — and "not to cannibalize, or take market share" from existing players in the market.

"This is very, very complicated," he said. "There's lots of aspects to what we want to do. And there's been a lot of good work in the community to date and we want to leverage that and build upon that and engage with people that worked on this for years to make our product better."

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