Binance Unveils Web3 Wallet to Promote “Self Sovereign Finance”
Digital asset exchange Binance has rolled out a web3 wallet to offer a simplified gateway to self-custody for its users.
The company announced the wallet’s launch at the Binance Blockchain Week Conference in Istanbul highlighting that it can be integrated across 30 blockchain networks and can connect users to several decentralized applications (dApps).
#Binance is now your one app for all things Web3.
Our new Web3 Wallet lets you connect DeFi to CeFi in one click.
Try it and let us know what you think.
— CZ 🔶 Binance (@cz_binance) November 8, 2023
Speaking at the conference, Binance CEO Changpeng Zhao noted the need to give users the ability to explore multiple forms of storing digital assets.
“Web3 wallets represent more than just storing digital assets; they are an integral part of the Web3 framework, empowering individuals with the ability for self-sovereign finance.”
The new web3 wallet will be available to all users on the Binance App and will compete with MetaMask and Trust Wallet. Trust Wallet is currently owned by the exchange so it is unclear the roles both wallets will play but according to reports, the new wallet will be easily accessible through the exchange.
While it stresses ease in ushering users to other forms of storage, it was not revealed if a know-your-customer (KYC) will be mandatory to use the service.
“Ultimately, our priority is to ensure users can explore Web3 with us within a user-friendly and protected environment.”
Binance backs MPC to tackle security concerns
In recent years, web3 wallets have been susceptible to the activities of bad actors leading to losses but the exchange has highlighted a way to prevent any infamous incidents.
The wallet integrates multi-party computation (MPC) which divides private keys into three parts onboarding key shares to reduce associated risks.
“Having the key shares split across three different locations mitigates the risk of the keys being compromised and reduces the vulnerability of the system.”
This system introduces users to self-custody as two out of the three shares will be held by users while the other will be in possession of the company. One of the two held in the user’s custody will be stored on the user’s mobile device while the other will be encrypted through the password recovery process backed with cloud storage.
As safe as this method seeks to get, the company further advises users to protect their details at all times and according to the Head of Regional Markets Richard Teng, it takes out the fear of losing seed phrases boosting user confidence as they interact in a safe web3 environment.
Unfortunately, not available in the United States
It has been revealed that the web3 wallet is only available in the global Binance.com without availability to the United States as the country transacts with a US entity, Binance.US.
The largest cryptocurrency exchange by trading volume will now go into competition with Coinbase and OKX who have previously launched web3 wallets at a time when it faces plunging spot trading volumes.
New reports show that the firm’s spot trading volume has declined significantly by almost 40% losing some market share to competition.