Note: Coinswitch currently does not have Metamask integration and does not support crypto-to-crypto withdrawals. Users can continue to trade in crypto using INR on Coinswitch.
India loves to hold on to its possessions. The country’s households, for instance, are said to be the largest private holders of gold.
It is then no surprise that there is significant interest among Indian crypto investors to self-custody their holdings, as against securing them with exchanges. Crypto assets can be stored in self-custody with hardware, a desktop, or a mobile wallet, such as Metamask.
Hardware wallets are the best self-custodial wallets available in the market but are expensive. Alternatives include desktop and mobile wallets that function as crypto wallets 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.
Metamask, one of the most popular crypto wallets, is available on both desktop and mobile. It provides a user-friendly way to store crypto 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. Its launch aimed 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 the 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 must 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, and the company doesn’t collect user information—a feature that enhances 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 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 control 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 crypto tokens right from the wallet instead of transacting through centralized exchanges, DEX aggregators, or automated market makers.
Access to the world of dApps: Metamask users can access several ETH-based dApps, DeFi platforms, NFTs, and much more. Users can easily browse and buy NFTs on Web3 marketplaces like OpenSea through the Metamask platform.
Recently, Metamask added support for Binance Smart Chain (BSC) and other smart contract platforms, allowing users to switch between their wallets and access dApps freely.
Safe and secure crypto storage: Users using online self-custodial wallets don’t lose crypto funds due to hacks or scams but 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 on 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 installation.
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. Once integrated, the user can freely move crypto between the two wallet addresses.
The risks of holding crypto in Metamask
Metamask is an online wallet, so it 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
- Trezor Wallet
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 seed phrases, make it a safe crypto wallet option for beginners and intermediate users in the crypto market.