How secure is the MetaMask wallet for cryptocurrency?
Investors require a safe avenue to store their cryptocurrencies. There is one software wallet that is used for swapping tokens, accessing decentralized applications (DApps) and buying digital assets. It is none other than MetaMask. Launched in 2016, users can access the hot wallet via browser extensions and mobile apps. Let us explore the different security measures available on MetaMask.
Storage of keys on the user’s browser — MetaMask thwarts hacking and phishing attacks by generating keys on the user’s device. It does not store these details on the server. Hence, crypto holders will have full control over their data, accounts, and funds.
End-to-End (E2E) data encryption — The MetaMask wallet stores passwords, private keys, and secret recovery phrases of users in an encrypted format. These details are stored locally on the device where it is installed. Crypto investors must write down their secret recovery phrase and private key and must not share it with anyone. Hence, users will only have access to their funds.
Hassle-free restore of wallets — Sometimes users might lose their password. They can restore access to their MetaMask wallet by utilizing the secret recovery phrase. Later, crypto holders can create a new password.
EIP-1559 integration — High gas fees often deter investors from executing transactions on a blockchain network. MetaMask solves this issue through EIP-1159 integration. Users can edit the gas fees by choosing options like Low, Market, Aggressive, and Advanced. This ensures transparency as information like the time estimate, maximum gas fees, and network status is displayed. The EIP-1559 also works seamlessly with hardware wallets like Trezor. Lattice1, Ledger Nano S, Ledger Nano X, AirGap, and Keystone.
Slippage protection mechanism — Sometimes, there may be changes in the rate between the order placement and confirmation time. Hence, slippage happens in case of price swings during token swapping. MetaMask allows users to set the minimum and maximum slippage rates. Hence, orders get virtually spread across different Decentralized Exchanges (DEXes). Thus, this decreases the slippage impact on the final price. Moreover, the token swap gets automatically cancelled if the slippage exceeds the maximum rate.
Absence of holding period — Users have instant access to their digital assets and there is no holding period. This makes MetaMask different from centralized exchanges (CEXes) that act as custodians of crypto assets.
DeFi Compliance — MetaMask integrates with more than 17,000 DeFi protocols. Thus, institutions have to undergo pre and post-trade Know Your Transaction (KYT) risk assessment on their smart contract addresses and DeFi pools. Generally, this happens before any dealings with pseudonymous counterparties.
Custody Solutions — MetaMask enables institutions to manage their storage of private keys and funds. Integration with custodians helps in enabling approval of multi-signature transactions and optimization of token swaps.
Tips for users to stay safe on MetaMask
- Crypto investors can secure their MetaMask wallet by backing up their seed phrase. They should write it down on paper or use a password manager. Hence, the 12-word phrase allows users to recover their wallets and funds even if they lose their passwords.
- Install anti-malware and antivirus software on your browsers. This prevents spyware and unauthorized access to the wallet.
- Use the auto-lock option and set a timer to lock the MetaMask wallet. This is important when users forget to log out of MetaMask.
- Since there is no Two-Factor Authentication (2FA) on MetaMask, it is important to create a secure password. Back it up in the key vault.
- Clear the browser history and remove cookies from the MetaMask wallet.
- Never share your private keys with anyone.
- Connect directly to hardware wallets like Ledger or Trezor. Hence, users can diversify their crypto holdings. The funds are stored offline without any connection to the Internet. Hence, MetaMask acts as an interface to the hardware wallet.
What are you waiting for? Explore the decentralized web now! Experience the benefits of self-custody by installing MetaMask for managing your digital assets.