Crypto wallets represent the gateway to digital assets, serving as the main interface for users to buy, sell and spend their bitcoin, ether and other cryptocurrencies. They’re essential applications for basically everyone who holds cryptocurrency, serving as a secure vault that protects the all-important private keys that enable access to their funds.
Over the years, crypto wallets have evolved quite a bit. The earliest such wallets were fairly basic yet clunky and difficult to use. In time, they became much cleaner and easier to use, if still somewhat basic. More recently, the pace of evolution has picked up dramatically, and the average crypto wallet today can do much more than just send, store and receive funds.
In fact, modern crypto wallets are much more like a financial nerve center, acting as a portal to a world of decentralized finance applications, trading platforms, NFT marketplaces and fiat-to-crypto on-ramps. In some cases, they can even store fiat currency too!
The World’s First Crypto Wallet
Popular crypto wallets today such as MetaMask and Trust Wallet are completely different beasts to the Bitcoin Core wallet that was created by Satoshi Nakamoto himself, and is still around today. It was released at the same time as Bitcoin itself, and was very different from what we’re used to now, as it functioned as both a non-custodial wallet and a kind of validator software, enabling users to participate in mining.
Bitcoin Core’s wallet functions were extremely basic. It was possible to send funds to, and receive them from another address, but that was pretty much it in terms of its transactional capabilities. At that time, things like DeFi and smart contracts hadn’t yet been conceived.
The other side of Bitcoin Core was that it enabled users to participate in running the network. The wallet acted as a full Bitcoin client, in addition to a wallet. It would download and store the entire Bitcoin blockchain on the user’s PC, and if the user desired, they could participate in the business of verifying transactions and blocks through its proof-of-work algorithm.
The Evolutionary Path Of Wallets
As Bitcoin grew in popularity, the deficiencies of the original Bitcoin Core wallet became all too apparent, and we soon saw the appearance of competing wallets with more streamlined user interfaces. The arrival of Electrum, the first mobile Bitcoin wallet, was a key milestone, making it possible for Bitcoin holders to manage their digital currency on the go and transact wherever they went.
Electrum’s launch led to an explosion in the number of third-party mobile wallets, offering more compelling alternatives to Bitcoin Core, with a focus on stronger security.
Examples include Mycelium, which launched in 2013 on Android, introducing support for crypto cold storage for the first time in a mobile wallet. It was also the first wallet to add support for the Tor network, enabling users to anonymize their transaction requests and enhance privacy. Another early favorite was Bread Wallet, later rebranded to BRD, which earned rave reviews for its simple and intuitive user interface, making Bitcoin more accessible to newcomers.
In 2014, the first hardware wallets appeared on the market from companies like Ledger and Trezor. These USB-type devices made it easy for users to store their private keys and crypto offline, where they can’t be hacked, increasing security for users. That same year, we also saw the rise of multisignature, or multisig wallets, such as Armory and Guarda Wallet, that require multiple signatures to process transactions. They quickly became very popular with crypto-focused enterprises that controlled significant amounts of crypto, as they can be set up so that multiple individuals need to sign off on transactions.
The Ethereum blockchain launched in early 2016 to shake up the cryptocurrency market with smart contract functionality, paving the way for decentralized finance and the birth of hundreds of new cryptocurrencies based on its network.
It was followed by a wave of new Ethereum wallets that could support multiple crypto assets besides ETH, allowing users to swap various tokens directly, without having to visit an exchange platform. In turn, that led to the rise of the first multichain wallets in 2017, which introduced support for multiple blockchains in one application, allowing users to swap crypto within their wallets to their heart’s content. Examples include Coinbase Wallet and Robinhood, which was based on the Polygon network.
Say Hi To Crypto Gateways
The ability to store thousands of cryptocurrencies in a single wallet was a game-changer, allowing users to keep all of their funds in one place, making it much more convenient to own crypto. But even so, these early multichain wallets still offered very little in terms of actual functionality. Aside from being tools for sending and receiving funds, and swapping tokens around, they did little else.
Meanwhile, the Web3 ecosystem began to expand dramatically around the turn of the decade, with the DeFi summer of 2020 leading to an explosion in the number of dApps that could only be accessed through a web browser. It meant users had no choice but to go through the hassle of connecting their wallet with every single dApp they used. As such, users would have to go to numerous different platforms, either to trade crypto, stake their assets, provide liquidity and engage in other yield farming activities. Navigating through Web3 was a challenge, to say the least, and it soon became apparent that this complexity was becoming a huge barrier to entry.
Fortunately, thanks to the rise of modern crypto projects like Venga, that’s no longer the case. Venga acts like a gateway to the growing Web3 ecosystem, enabling users to perform multiple tasks from a single mobile app.
One of the most noticeable things about Venga is its clear and intuitive UI, which begins with a simple set up process where the user simply enters an email address and sets up a password and passcode. There’s no need to write down a seed phrase, as it instead allows for email-based password recovery. Its simple navigation helps to onboard new users rapidly, eliminating the technical barriers associated with traditional wallets.
These days, users want much more from their crypto wallets. They want an experience that matches what they have in traditional finance. With their standard mobile banking app, consumers can access all kinds of financial services, including obtaining new credit cards, taking out loans, opening savings accounts and even investing in stocks and shares. If crypto is to keep up, it needs to match these capabilities. So, the old buy, swap and sell experience doesn’t cut it any more.
Simply put, users don’t want to have to navigate to different websites to use their crypto. That’s why Venga offers a built-in exchange platform and integrated staking for tokens such as ETH, directly in its wallet, so users can start earning a passive income in a few simple clicks. It also comes with its own fiat bridge. Using its Euro Accounts feature, users can send euros to their Venga wallet, and then immediately use these funds to buy crypto. When they’re ready to cash out, they can swap their crypto to euros and immediately withdraw to their bank accounts.
It’s a clever combination of usability and functionality that appeals to both new and existing crypto users alike, and it’s a great example of the direction crypto wallets are heading towards. There’s a lot more to come from Venga. For instance, support for additional staking options in future, tokenized real-world assets and DeFi dApp integrations are on its roadmap, meaning users will have many more ways to earn money without ever leaving the app.
A Window To The Web3 World
It’s not hard to imagine an even better crypto wallet experience in the future with the rise of artificial intelligence technology.
By integrating AI, crypto wallets will be able to offer a much more personalized experience to each user, providing insights and investment recommendations based on their risk tolerance and previous transaction histories. They’ll be able to automate more sophisticated trading strategies and optimize yield farming in DeFi. In addition, AI also promises to enhance security for crypto wallets with its ability to detect and prevent fraudulent activities.
With their relentless focus on functionality, ease of use and security, modern wallets are transforming how we interact with everything crypto has to offer, enabling better and simpler experiences that will bring us closer to mass adoption.
