Web3 Wallets are revolutionizing how we own and monetize everything from our identity, content, and assets. Web3 wallets allow users to interact with decentralized applications (dApps), trade Non-Fungible Tokens (NFTs), transfer tokens, create on-chain identities, and collaborate with Decentralized Autonomous Organizations (DAOs). These are just a few of the many use cases that exist today, and the number will grow exponentially over the coming years.
As a developer, you need to understand that the kind of wallets you choose to support should map well to your target use cases. Each wallet has its own pros and cons, features, and capabilities.
Let’s quickly review the kinds of Web3 Wallets available today:
Types of Web3 Wallets
Image by Alchemy
Desktop Wallets are applications that are downloaded and run on your laptop or desktop computer. Desktop computers are much more powerful, allowing them to run a full node. This allows the wallet to operate directly with the blockchain without relying on a third-party hosted node. This operation is the most decentralized and often considered the safest form of a hot wallet.
Mobile Wallets are apps that are downloaded to your smartphone. Mobile devices have limited power and bandwidth, so they tend to favor simplicity and don’t always have all of the features of desktop wallets. Modern mobile phones have strong security features built into the hardware, which can keep cryptocurrency secure. However, mobile phones can more easily be lost and stolen, so it is generally recommended that only small amounts of cryptocurrency be kept on the device.
Web Wallets are accessed via a web browser interface or extension. These wallets sometimes live on external servers and use a third-party hosted node. A web wallet requires a certain level of trust in the web host to ensure you are served a safe page. Some of the most popular wallets are web wallets, but precautions should still be taken to minimize risk whenever possible.
Hardware wallets are physical devices that hold public and private keys in the device itself, with zero connection to the internet. This is the most secure form of wallet available today.
Paper wallets are just as they sound–a piece of paper with a QR code. However, this form of wallet isn’t used for obvious usability reasons.
Features of the Best Web3 Wallets
Let’s start with some general features of Web3 Wallets. All good wallets should be able to:
- Store, swap, send and manage tokens and NFTs
- Support a wide array of tokens
- Be able to explore and interact with multiple blockchains
- Provide top-notch security
- Support a wide variety of dApps
Some questions you should be asking yourself might include:
- Does the wallet offer staking?
- Does the wallet offer extra security through 2-factor or biometric authentication for decentralized identity (DID) services?
- Does the wallet offer a sound wallet recovery system?
- Does the wallet offer lending and borrowing natively?
- Does the wallet display NFTs and other digital assets in the application?
- Does the wallet feature a built-in exchange?
- Does the wallet offer in-wallet messaging functionality?
- Is the wallet custodial or non-custodial?
- Does the wallet offer Layer 2 solutions like Polygon or Godwoken?
- Does the wallet offer cheap or free transaction fees for coin swaps?
- Does the wallet offer good documentation and support?
What Do Developers Want in a Web3 Wallet?
As a developer, here are some capabilities you might consider in choosing your Web3 Wallet to develop with:
- Compatibility: Wallets suitable for developers should be compatible with as many operating systems, assets, and blockchains as your use case requires. Being able to toggle between different blockchains easily, for instance, is something that many dApps need, especially as interoperability moves to the forefront in Web3.
- DApp browser API: A reliable dApp browser could help you interact with the ecosystem of decentralized applications.
- Testnet Faucets: Testnet faucets are essential, as any Web3 developer knows. Accessing free tokens for testing your smart contracts and other transactions is critical to your development success. Developers often complain about needing more tokens in a 24-hour period-the time, as many faucets keep the number of tokens allocated low. Thus, you might want to look for a wallet connecting to faucets that supply as many test tokens as possible. Lastly, anonymous testnet faucets are a feature in some wallets and would be vital if you don’t want to provide personal information.
- NFT browser: Do you need to be able to display and browse an NFT collection visually? Does your application require compatibility with as many blockchains as possible? Finding a wallet with good NFT support on multiple chains is important for developers working with NFT applications.
- Auto Logout: Extra security. Auto Logout features will ensure users don’t leave their wallets open for periods of time when they are away.
- Biometric / 2-Factor Authentication: Do your projects need more than one form of authentication? Biometric authentication continues to gain traction in both web2 and web3 applications. 2-Factor authentication is already standard in most applications and something you likely would want.
- Support for all EVM-compatible L1/L2 networks: Depending on what blockchain you are building on, you will need to check compatibility. The vast majority of applications require EVM compatibility.
- Network Switching: Do you need to be able to easily switch networks, search for new networks, and quickly add custom networks? Interoperability is becoming a key feature of many wallets, and thus something you may want to consider as you decide which wallet is best for you.
- Multi-Sig – A MultiSig wallet uses more than one private key to authorize crypto transactions. Holding private keys in different locations increases security and enhances the usability of wallets.
- Gas Adjustment – Some wallets can adjust the amount of gas you are willing to pay to speed up or ensure your transaction gets prioritized on the blockchain.
- Native DEX trading – Some wallets, like DexWallet, allow users to borrow, lend, exchange, and stake right from the wallet itself.
- Community – You like will want to find a wallet that is well supported, actively making improvements, and resolving bugs quickly as they are found. In addition, any wallet you use for development should have ample documentation.
There are a lot of great wallets out there for software developers.
Here are a few articles to help you do some further research:
What Are Some Good Nervos Network Wallets for Developers?
For Nervos developers, your best choice is the Neuron wallet or Portal wallet. If you choose the Neuron Wallet, you will also run a bundled CKB Mainnet node and connect to the CKB Mainnet automatically. On the other hand, the Portal wallet is an excellent alternative to Neuron Wallet as it allows smartphone usage.
It is beyond the scope of this article to navigate all of the options for developers when it comes to choosing a wallet. However, there are a lot of questions you should ask in the beginning, and these questions should be based on your goals and use case.
While you may want to choose the most popular wallet, Metamask, this wallet may not be the best for your specific development needs.
Other wallets great for developer usage include Trust Wallet, Coinbase Wallet, WalletConnect, and an exciting application called Wallet Onboard by Plaid, which allows connectivity to hundreds of self-custody wallets like MetaMask, Coinbase Wallet, Trust Wallet, and Ledger.
At this time, only a few wallets have been designed with developers in mind in terms of providing great documentation with good testing features. However, we see this changing in the future as crypto and Web3 mature, especially as regulation increases.