Crypto Wallets: Landscape & Strategies

Key Insights

• Wallets are lucrative, but they need to improve significantly on UX in order to cross the adoption chasm. The four elements of the wallet stack wallets compete on are key management, blockchain connectivity, user interface, and application logic.
• Smart contract (SC) wallets allow for greater customizability in key management and user interfaces while also enabling programmable application logic at the wallet level.
• Multi-Party Computation (MPC) wallets enable customizable key management schemes, allowing for more robust security tools with greater accessibility.
• Maintaining existing and growing new advantages in user acquisition and distribution will be key to winning the wallet space.
• Coinbase and Metamask have the clear lead in the wallet space today, but Safe’s partnership with Stripe and the addition of fiat onboarding to Uniswap may challenge that lead moving forward.

Wallets are lucrative if you’re on top. By June of 2022, most of the Metamask airdrop rumors had subsided, yet the wallet still generated an additional $100 million in cumulative swap fees in 9 months since.