Metamask: An ETH-First Crypto Wallet for Swaps and dApps

What Is MetaMask?

MetaMask is a free web and mobile crypto wallet that allows users to store and swap cryptocurrencies, interact with the ecosystem, and host a growing array of . It is one of the most widely used crypto applications in the world. With over as of early 2024, MetaMask has become one of the most popular crypto wallets for both new and experienced users in the Ethereum ecosystem.

For users in Singapore, a MetaMask wallet can be used to: 

• Purchase from Singaporean artists on marketplaces like Mintable. 

• Participate in protocols with a local presence, including notable projects like Ziliqa or Pendle. 

• Engage with blockchain-based games and metaverse projects that are gaining traction in the region.

MetaMask has played an essential role in raising the standards of usability in blockchain and crypto technology, laying the foundation for the explosive growth of sectors like decentralized finance and NFTs by simplifying and streamlining the Ethereum user experience into one simple wallet interface.

How Does MetaMask Work?

MetaMask has three primary uses: storage, swaps, and dApp access. Collectively, these functions encompass everything a normal crypto user would likely ever need to interact with Ethereum.

Crypto Storage

MetaMask’s built-in crypto wallet can be used to store tokens that are built on Ethereum’s and , and users can easily create and navigate between multiple wallet addresses within the app. 

The application’s advanced encryption technology allows users to securely store their wallet passwords and private keys within their own browser via a MetaMask extension, which gives them more control over both their . 

Additionally, new users are provided with a set of seed phrases when they first create an account, which can be used to recover their account if necessary.

Token Swaps

MetaMask has a trade function that lets you execute peer-to-peer (P2P) token swaps directly from your wallet. Instead of transacting through an order book, exchange, or liquidity model, these swaps aggregate data from multiple DEXs, , and . MetaMask swaps allow users to trade crypto directly without having to interact with any other custodial or intermediary platform, thus reducing friction, limiting slippage, and lowering costs.

Access to dApps

MetaMask users can also use the wallet to directly access a wide range of Ethereum-based dApps, crypto lending products, Ethereum-powered games, NFTs, and more. Additionally, MetaMask’s built-in crypto wallet makes it easy for users to spend, send, or anywhere within the Ethereum ecosystem without having to manage external wallet integrations or unnecessary transactions. As a result, MetaMask directly provides users with an easy entry point into the world of DeFi and other blockchain-based sectors and services.

In 2020, MetaMask was updated to allow for integrations with Binance Smart Chain (BSC). This means users can now switch freely between their Ethereum and Binance crypto wallets, trade on DEXs from either network (albeit not simultaneously), and access dApps from both ecosystems. So while MetaMask was primarily focused on Ethereum development initially, its evolution through 2023 and 2024 has transformed it into a comprehensive, multi-chain gateway to Web3. A key part of this expansion is its seamless integration with popular Ethereum . The wallet now actively supports and simplifies access to leading L2s like , Optimism, Base, zkSync Era, and Linea, allowing users to benefit from their lower fees and faster transaction speeds. 

A more fundamental leap came with the full launch of MetaMask Snaps in late 2023. Snaps are applications that securely extend the wallet’s functionality, enabling support for non-EVM () blockchains such as Solana, Near, and Bitcoin for the first time from within the MetaMask interface. 

To simplify multichain management, MetaMask Portfolio brings bridging, swapping, buying, and selling together in a single dashboard. On the security front, Metamask now incorporates free, privacy-focused security alerts by default, a feature developed with the security firm Blockaid. These alerts help to warn users against potential scams and phishing attempts before they occur.

MetaMask’s Role in dApp Development

MetaMask’s open platform also plays a key role in promoting Ethereum-based dApp development for coders and technologists. For developers building a dApp, Metamask is pre-loaded with fast connections to Ethereum and several test networks via Infura. These built-in connections allow developers to begin building a new dApp on Ethereum without the need to set up and run a full network . This can be helpful for entrepreneurs looking to build immediately, whether they are creating a simple browser-friendly or a full-fledged, mainnet-ready dApp that will support an entirely new decentralised marketplace.

Additionally, since MetaMask extensions are compatible with popular browsers like Chrome, Firefox, and Safari, the application makes it easier for developers to create new applications that are designed to work within traditional browsers. Thus, MetaMask’s role in enabling dApp adoption is two-fold: It provides a portal for end users to access dApps, while also enabling developers to streamline their path to getting those applications to market.

Potential Risks to Using MetaMask

While MetaMask is undoubtedly one of the most feature-rich, user-friendly crypto applications available, there are a few key considerations worth noting:

• MetaMask’s browser-based nature presents potential security risks: While the MetaMask extension itself does not have access to any of your personal information, the web browser you access it through might. And while your browser won’t have access to your private passphrases or other sensitive data, most browsers are designed to collect information about when and how you use any integrated app or plug-in. Additionally, since MetaMask stores private keys within the user’s browser, the theft of this data remains theoretically possible, if still unlikely.

• MetaMask funds are stored in hot wallets: In order to make it as easy as possible for users to access, trade, and use their crypto, MetaMask stores all of its users’ assets in hot , i.e. digital crypto wallets that are perpetually connected to the blockchain. While both MetaMask Mobile and the desktop MetaMask extensions have strong encryption features, hot wallets can never be as secure as cold wallets, and any information that is stored online long-term runs the risk of being stolen.

• MetaMask relies on external nodes: Rather than running a full node of its own, MetaMask relies on external nodes that the application has no direct control over. While this has not resulted in any persistent issues to date, these nodes may occasionally experience downtime, which can temporarily disrupt or shut down the application.

Regulatory and Legal Context in Singapore 

In Singapore, the Monetary Authority of Singapore (MAS) is the primary regulator for cryptocurrency-related activities. While MetaMask itself, as a non-custodial wallet software, is not directly licensed by MAS, the platforms you use to buy and sell cryptocurrencies are subject to MAS regulations, primarily the Payment Services Act  2019 (PSA). 

This means that when you use a licensed exchange in Singapore to fund your MetaMask wallet or cash out your crypto, that exchange must comply with MAS’s rules on , countering the finance of terrorism, and consumer protection. It’s important to note that the funds in your MetaMask wallet are not covered by the same protection as funds held with a licensed entity.

Using MetaMask in Singapore 

Here are some tips for using MetaMask in Singapore: 

• Funding Your Wallet: To get started, you’ll need to buy ETH in Singapore from an exchange. Gemini has received an In-Principle Approval (IPA) from MAS for a Major Payment Institution (MPI) license. You can securely purchase crypto on Gemini via FAST or PayNow. You can then transfer these assets to your MetaMask wallet for self-custody. 

• Connecting to Local dApps: Explore the growing Web3 ecosystem in Singapore. Use your MetaMask wallet to connect with homegrown projects, such as the NFT marketplace Mintable, DeFi liquidity protocols like Kyber Network, or the broader Ziliqa ecosystem which was developed in Singapore.

• Focus on Safety and Minimal Setup: Add networks from trusted sources only and avoid random RPC prompts. If you explore non-EVM support via Snaps, install only vetted snaps and review permissions carefully. 

• Understanding Your Tax Obligations: It’s important to stay informed on how your crypto activities are treated for tax purposes. While , profits from activities that amount to trading or business are taxed as income. You should record the SGD value when you are paid in crypto for goods or services. 

MetaMask: A Glimpse at the Future 

MetaMask provides a simple and flexible way to store crypto, swap tokens, and interact with dApps and decentralised services. While it originated on the Ethereum blockchain, its capabilities have grown to embrace a multi-chain future. Today, Metamask offers seamless access to a vast array of -compatible networks, including prominent like Polygon, , and Optimism, which users can manage through the central MetaMask Portfolio dashboard.

With the introduction of MetaMask Snaps, the wallet is breaking new ground by enabling interoperability with selected non-EVM networks, such as Bitcoin and Solana. This extensibility allows developers to add new features and connect to virtually any blockchain, accelerating the growth of a wider, interconnected decentralised internet.

Before you dive into DeFi protocols and NFT marketplaces, use Gemini as your secure on-ramp to convert fiat into and other supported tokens for your MetaMask transactions. Buy your crypto on a compliant exchange, then move your funds on-chain with peace of mind to start interacting with your favourite dApps. 

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