Binance, one of the leading cryptocurrency exchanges, has recently unveiled its new Web3 wallet. This wallet is designed to enable users to interact with the decentralized finance (DeFi) ecosystem. The announcement was made during the Binance Blockchain Week conference in Istanbul. The Web3 wallet will be compatible with 30 different blockchain networks, providing users with a wide range of options for their DeFi activities.
According to Binance CEO Changpeng ‘CZ’ Zhao, Web3 wallets are not just about storing digital assets. They are an essential component of the Web3 framework, empowering individuals to have greater control over their finances. By utilizing a Web3 wallet, users can enjoy the benefits of self-sovereign finance.
Binance’s Web3 wallet will be entering a competitive market, as it will be vying against established players such as MetaMask and Trust Wallet. Interestingly, Binance acquired Trust Wallet back in 2018. Just last week, Binance listed a futures market for TrustWallet’s native token (TWT). Other centralized exchanges like Coinbase and OKX also offer Web3 wallets.
To create a Web3 wallet through Binance, users can simply download the exchange’s mobile app. This app will serve as a platform for various DeFi activities, including staking, lending, and borrowing. However, it remains unclear whether users will be required to complete a know-your-customer (KYC) procedure in order to create a wallet.
Web3 wallets have long been targeted by hackers and exploiters due to their potential for unauthorized access. Once a hacker obtains the private key, all funds within the wallet can be permanently drained. In an effort to enhance security, Binance has implemented multi-party computation (MPC) in its Web3 wallet. This technology eliminates the need for users to memorize seed phrases while still maintaining the benefits of security and self-custody. The private key is divided into three parts, known as key shares, with the wallet owner controlling two of the three key shares.
CZ emphasized that Binance’s priority is to provide users with a user-friendly and secure environment for exploring the world of Web3. By offering a Web3 wallet with enhanced security measures, Binance aims to instill confidence in users and protect their digital assets.
In conclusion, Binance’s release of its Web3 wallet marks a significant step towards the widespread adoption of decentralized finance. With its compatibility across multiple blockchain networks and enhanced security features, Binance aims to position itself as a leading player in the Web3 ecosystem. As the popularity of DeFi continues to grow, it will be interesting to see how Binance’s Web3 wallet competes with other established players in the market.
Edited by Aoyon Ashraf.