Crypto Intermediate

Metamask Wallet: Is Metamask Safe Enough to Store Your Crypto?

is metamask safe

Not your keys, not your coins—the crypto world is suddenly abuzz with this seemingly casual, yet meaningful phrase that refers to the safety of coins. The security question assumed importance in the wake of a series of recent incidents that resulted in investor losses wherein hackers and scammers wiped off crypto holdings worth billions of dollars. To safeguard against such instances, experts have recommended using self-custodial wallets to store cryptos safely. Hardware wallets are the best self-custodial wallets available in the market, but they are expensive, which most retail investors cannot afford. Alternatives include desktop and mobile wallets that function as a crypto wallet and provide a gateway to blockchain apps: Metamask enjoys a preeminent position in this category. But, is Metamask safe to store cryptos? Let’s dig in.

About Metamask

Metamask, by far the most popular crypto wallet in the market, is available on both desktop and mobile. It provides a user-friendly way to store your cryptos within the wallet and collect non-fungible tokens (NFTs) across multiple blockchain platforms.

ConsenSys, a New York-based blockchain software technology company founded by Joseph Lubin, launched the wallet in 2016. The idea was to simplify access to dApps, online gaming platforms, and staking in DeFi spaces.

Metamask began life as a secure crypto wallet option offering a beginner-friendly bridge between a web browser extension and the Ethereum blockchain. Initially, Metamask was an extension of web browsing platforms like Chrome, Firefox, and Brave.

However, with the increasing popularity of cryptos and rising adoption of crypto wallets, Metamask created the mobile app version of the wallet.

Metamask initially stored ETH and ERC standard tokens, and later on, it began supporting networks such as Binance Smart Chain, Polygon, and Avalanche. It doesn’t support Bitcoin Network; therefore, you cannot store Bitcoins on Metamask wallet.

Metamask’s safety features

To understand Metamask’s safety features, you need to know how it provides a secure way to store crypto tokens. This will also help answer the question if Metamask is safe to use.

Metamask is a non-custodial wallet—it doesn’t store users’ private keys on central servers or the company doesn’t collect user information—a feature which enhances its safety. Once the wallet is installed and the user is registered, it can only be accessed using a password or restored using a 12-word seed phrase that is generated during the registration process which must be stored securely.

So, when you first create a Metamask ID, you are shown a list of 12 words known as Seed Recovery Phrase and it uses BIP39—a common standard used in crypto wallets—to generate these 12 words from a list of 2,048 words.

Each word in the seed recovery phrase has a number associated with it and is used to form a seed integer, which is then used to create a set of public and private keys.

Metamask generates a private key using the SHA 256 hashing function and the seed integer obtained from the seed recovery phrase. Subsequently, the corresponding public key is derived from the private key using the ECDSA algorithm.

With both public and private keys in place, Metamask will be able to create your first account.

Metamask then encrypts your private key using the password provided during the installation stage and stores it in your browser’s data store, while the mobile app stores the encrypted private key with the async-storage module.

Thanks to these features, users exert control over their wallet’s private key, making Metamask a safe option for saving cryptos.

Benefits of Metamask Wallet

Metamask is a popular wallet for storing Ethereum and Ethereum-related tokens. Some of the benefits of using Metamask are:

Crypto swaps: Metamask has a unique feature that allows P2P (peer-to-peer) swapping of crypto tokens right from their wallet, instead of transacting through centralized exchanges, DEX aggregators, or automated market makers.

Access to the world of dApps: Metamask users can access a number of ETH-based dApps, DeFi platforms, NFTs, and much more. Users can easily browse and buy NFTs on Web3 marketplaces such as OpenSea through the Metamask platform.

Recently, Metamask added support for Binance Smart Chain (BSC) and other smart contract platforms, allowing users to freely switch between their wallets and access dApps.

Safe and secure crypto storage: Users using online self-custodial wallets don’t lose crypto funds due to hacks or scams, but due to social engineering schemes that reveal seed phrases on the internet. As Metamask uses seed phrases to generate public/private keys and encrypts them using users’ passwords, hackers find it hard to breach the security layer. And, top of that, Metamask code is open source. All these features make Metamask safe for users to store cryptos.

Also, it allows for safe storage of ETH and ETH-based tokens and can easily navigate through multiple walled IDs within the mobile app. Moreover, recovering your crypto wallet is easy if you have kept the seed phrases secure during the installation process.

Adjustable gas fees: Based on the importance and priority of transactions, Metamask users can adjust and fix the gas fees at a granular level.

Compatible with hardware wallets: Metamask can be integrated with hardware wallets such as Trezor and Ledger on the browser extension and one can freely move cryptos between the two wallet addresses.

The risks of holding crypto in Metamask

Metamask is an online wallet, which cannot match the safety standards of a hardware wallet. Nonetheless, it is a more secure option than storing large amounts of crypto holdings in exchange wallets that are vulnerable to hacks and scams.

What are the alternatives to Metamask?

Some of the alternatives to Metamask wallet include:

  • Trust Wallet
  • MyEtherWallet
  • Hyperledger
  • Trezor Wallet
  • StakedWallet.io

Conclusion

Metamask is a simple, easy, and free-to-use crypto wallet for users. The integration with various dApps and NFTs and the support of thousands of tokens have made it the go-to wallet option for users. Metamask’s unmatched security features, including the use of seed phrases, make it a safe crypto wallet option for beginners and intermediate users in the crypto market.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered investment/financial advice from CoinSwitch. Any action taken upon the information shall be at the user’s risk

Share this:

IN THIS ARTICLE

Subscribe to our newsletter

Get the latest crypto news and coverage delivered to your inbox. Free.

Browse our Newsletter Archive for past editions.

SnowSnow

Thank you for subscribing!
Please verify your email to start receiving the latest issues from Switch in your Inbox.
Powered by

Smart takes, updates and insights delivered daily to your inbox

Build your crypto portfolio on the
CoinSwitch app today

Scan the QR code below or find us on Google Play
Store or Apple App Store.

Build your crypto portfolio on the
CoinSwitch app today

Scan the QR code below or find us on Google Play Store or Apple App Store.

Smart takes, updates and insights delivered daily to your inbox

Smart takes, updates and insights delivered daily to your inbox