What is a DeFi Wallet? Is it Different from Other Crypto Wallets?
To transact in crypto you must possess a crypto wallet. Usually, every large crypto exchange already have a integrated crypto wallet. Likewise for DeFi platforms. A DeFi wallet is needed to invest in DeFi.
DeFi wallets are different from the custodial wallets that most are familiar with from crypto exchanges.
Here are the differences and why DeFi wallets are important to know:
DeFi wallets are non-custodial, which means they are the only ones who have access to the funds.
All DeFi wallets have a unique keypair which is different from crypto wallets on exchanges or centralized wallets. Here, users are responsible for storing their private keys in the form of seed phrases.
Seed phrases are a collection of words taken from a dictionary, and each word is related to a specific number. Make sure you keep your seed phrases secure.
3. Easy Access
DeFi Wallets tend to be more accessible than other exchange based wallets, as you are the only one with full control and access over it.
Almost all DeFi wallets are accessed by connecting a web3 app. Various browser-based dApps (decentralized apps) allow for easy access and management of your DeFi wallet.
Tips for Saving DeFi by Choosing the Right Wallet
Access Point: Your wallet or wallet is an access point to the DeFi ecosystem. Ensure the network your DeFi wallet is operating on has a good reputation for being reliable.
Note Supported Crypto Assets: Different wallets can be used to store different crypto assets. Ensure that your chosen DeFi wallet is compatible with the crypto assets you will largely be storing. For example, in MetaMask you cannot store Bitcoins.
Testimonials of Wallet Users on Social Networks: Monitor the DeFi wallet provider’s social media to check its reputation and customer satisfaction. Take note on whether enough users show their trust in using the wallet.