A cryptocurrency wallet serves as your primary interface with blockchain networks. It manages your private keys, which act as the keys to your digital asset vault. These tools allow you to receive, store, and send cryptocurrencies securely.
Custodial vs. Non-Custodial Wallets
There are two fundamental types of cryptocurrency wallets: custodial and non-custodial.
Custodial wallets are managed by a third party that holds and controls your cryptocurrencies on your behalf. This setup offers convenience, as you only need to secure your account credentials—similar to protecting an email login. However, entrusting your assets to a third party exposes you to risks like mismanagement or security breaches by the custodian. History includes several high-profile incidents where custodial services lost user funds, such as the 2014 Mt. Gox incident, which resulted in the loss of over 850,000 Bitcoin.
Non-custodial wallets empower you with full control and ownership of your assets. This approach aligns with the "be your own bank" philosophy prevalent in the blockchain space. While this eliminates reliance on third parties, it also transfers the entire responsibility of securing your private keys to you. Losing your private keys means losing access to your funds permanently.
We advocate for the principle of "not your keys, not your coins." We believe users should educate themselves on security best practices and take personal responsibility for safeguarding their assets.
Choosing the Right Wallet for You
The market offers a wide variety of cryptocurrency wallets. For those beginning their journey in Decentralized Finance (DeFi) on the Ethereum network, two user-friendly and DeFi-compatible options stand out: one for mobile and one for desktop users.
Mobile Wallet: Argent
Argent is a non-custodial mobile wallet renowned for combining ease of use with robust security features—a rarity in the crypto space. Its innovative security model is built around a concept called "Guardians."
Understanding Argent Guardians
Guardians represent a novel form of social authentication. Instead of relying on complex private key memorization or centralized entities to manage account access, you designate a network of trusted contacts (like friends or family who also use Argent), other wallet addresses, or even two-factor authentication services. This trusted circle can help verify your identity and assist in account recovery if you lose access, significantly reducing dependency on vulnerable paper seed phrase backups.
Key Security Features of Argent
- Wallet Locking: If you suspect your wallet is compromised, you can immediately freeze all funds. The wallet automatically unlocks after five days, or you can initiate an earlier unlock with the approval of your Guardians.
- Daily Transfer Limits: You can set a maximum daily transaction limit. This helps prevent hackers from draining your funds if they gain access. Transactions exceeding the limit are delayed for 24 hours, though legitimate large transfers can still be approved instantly with help from your Guardians.
- Initial Setup Fee: Creating an Argent wallet requires a one-time Ethereum network fee. Subsequent transactions also incur standard network gas fees, from which Argent does not profit.
A significant advantage of Argent is its seamless integration with DeFi. You can interact directly with various DeFi applications (DApps) from within the wallet itself, eliminating the need for additional tools.
Getting Started with Argent
- Download the Argent app from your phone's official app store.
- The app will notify you of the one-time Ethereum network fee required for wallet creation. Proceed and choose a name for your new wallet.
- You will be prompted to add a phone number. This step enhances security and simplifies future verification processes.
- Next, provide and verify your email address.
- Once setup is complete, you will receive an email confirmation. Your wallet is now ready to use.
- You can now receive or send cryptocurrencies. For enhanced security, it is highly recommended to add several Guardians to your wallet's trusted circle.
Desktop Wallet: MetaMask
For desktop users, MetaMask is the leading browser extension wallet, compatible with Chrome, Firefox, Opera, and Brave. It functions as both a non-custodial wallet for storing Ether (ETH) and ERC-20 tokens and as a bridge to interact with the Ethereum network. While a mobile app exists, some DApps are not optimized for it, making the browser extension the preferred choice for desktop DeFi activities.
The Role of a Web3 Bridge
Without a tool like MetaMask, your browser cannot communicate with the Ethereum blockchain unless you run a full node, which involves downloading over 400GB of blockchain data. Technically, MetaMask injects a JavaScript library called web3.js into your browser, enabling websites to request transactions and data from the Ethereum network seamlessly.
MetaMask makes interacting with DeFi DApps from a laptop or PC incredibly convenient. It provides a layer of security by requiring you to cryptographically sign every transaction and interaction. The extension also includes a built-in token swap feature, allowing you to exchange tokens directly from your wallet.
For optimal security, it is advised to use MetaMask in conjunction with a hardware wallet. Remember, anyone who obtains your password or secret seed phrase gains complete control over your assets.
Most DeFi applications are accessible via MetaMask, and it is the tool of choice for many step-by-step guides in the ecosystem.
Setting Up MetaMask
- Install the MetaMask extension from the official browser store.
- After installation, click "Get Started."
Select "Create a Wallet" and then click "Next."
Pro Tip: If you are restoring an existing wallet, choose "Import Wallet." For maximum security against phishing, consider creating or importing wallets on an offline device.
- Set a strong password. This will be used to unlock the MetaMask extension on your browser.
This is the most critical step. You will be presented with a secret backup phrase (seed phrase).
- Never lose this phrase. It is the only way to recover your wallet.
- Never show it to anyone. Anyone with this phrase can control your funds.
- Write it down on paper and store it in multiple secure physical locations.
- You will be asked to confirm the backup phrase by selecting the words in the correct order to verify you have recorded it properly.
- Congratulations! Your wallet is now created and ready to store ETH and ERC-20 tokens.
- Your public wallet address (a long string of characters starting with "0x") will be displayed. This is your receiving address. You can share its QR code for others to send you funds.
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Frequently Asked Questions
What is the single biggest risk of using a non-custodial wallet?
The greatest risk is the loss of your private key or seed phrase. Unlike a bank, there is no password recovery option. If you lose your seed phrase, you permanently lose access to all assets in that wallet. The responsibility for secure backup is entirely yours.
Are network fees on Argent and MetaMask paid to the companies?
No. Both wallets charge network fees (gas fees) required to process transactions on the Ethereum blockchain. These fees are paid to network validators, not to Argent or MetaMask. They are simply passing the cost along.
Can I use the same wallet address on both Argent and MetaMask?
No. Argent and MetaMask are separate wallet applications that generate their own unique addresses. However, you can import an existing wallet into either application using your secret seed phrase, which would give you access to the same address on both platforms.
Is it safe to connect my MetaMask wallet to any DeFi website?
You should only connect your wallet to websites you trust. While connecting your wallet is generally safe (websites cannot withdraw funds without your explicit approval), malicious sites can present fraudulent transaction requests. Always verify the website's URL and authenticity before connecting.
What happens if my phone with the Argent app is lost or stolen?
Since Argent is non-custodial, your funds are safe. Your wallet is secured by your Guardians. Using a new device, you can download the Argent app and recover your wallet through the social recovery process with the help of your designated Guardians.
Why would I need a hardware wallet with MetaMask?
A hardware wallet keeps your private keys isolated on a physical device, separate from your internet-connected computer. When using it with MetaMask, all transactions must be physically approved on the hardware device. This provides a powerful defense against malware and phishing attacks that could compromise your computer.