by Jake Wengroff
Known for its simplicity and flexible design, Metamask is a popular hot storage option for those who are new to the crypto world —as well as those that are committed to Ethereum blockchain. But is the popular browser extension a safe way to hold your assets? Here’s what you need to know.
Metamask Basics
Metamask is a cryptocurrency wallet that is online and accessed through a web browser. Metamask is rather limited, as it is able to store keys for Ethereum cryptocurrencies only. Unfortunately, it cannot be used to store the keys for other types of crypto or digital currencies.
The Ethereum blockchain is a network where users can build their own apps, known as dApps, and brand new cryptocurrencies. Ethereum also allows users to write transaction guidelines, called smart contracts, through which other types of e-commerce or exchange can take place.
The cryptocurrency of Ethereum is called Ether; other cryptocurrencies built on the Ethereum blockchain are known as tokens. Most of the tokens built on the Ethereum blockchain are called ERC-20 tokens because they follow the rules that Ethereum developers have set out for creating new cryptocurrencies.
As such, the Metamask wallet can be used for storing keys for Ether and ERC-20 tokens on three different web browsers. It also allows users to browse the Ethereum blockchain from a standard browser.
Benefits of Metamask
Open Source and Community
Open-source software is generally considered a benefit because no single private, for-profit company owns the code. All of the Metamask code is online and free to access. It is continually reviewed and updated by the community, which counts over one million active users, many of whom contribute to and improve the platform.
HD Settings
Metamask uses HD, or hierarchical deterministic, settings to help users backup their accounts. They do this by giving the user a list of words called seed phrases. Seed phrases can be used to reset lost account information.
Easy Purchasing
Metamask links directly with two exchanges for a facilitated purchasing experience. Users can select Coinbase to purchase Ether and ShapeShift to buy Ether or ERC-20 tokens.
Local Key Storage
Some wallet providers store keys on their own servers. This is common on exchanges that provide wallets, like Coinbase. Instead, however, Metamask keys are stored on the user’s own browser, not on a company’s owned or remote servers. This local key storage gives users more control over their public and private keys.
Risks of Metamask
There are a few risks of using Metamask. Let’s have a look at them.
Online
The wallet is online, so it’s more at risk than hardware wallets or offline “cold” wallets. Like any “hot” wallet, assets stored on Metamask can be compromised via security vulnerabilities on your device or internet connection. For this reason, most crypto investors only use hot wallets like Metamask to store small amounts of cryptocurrency, and rely on cold wallets — which are not vulnerable to being hacked in the same way as hot wallets —to hold larger sums of cryptocurrency.
Browser Access
Because of Metamask’s hands-off approach to storing user data, Metamask doesn’t have access to any of a user’s information. However, the browser on which Metamask is installed will. Browsers collect browsing and internet usage data, including how often a user uses Metamask. This tracking data is usually a turn-off for cryptocurrency users.
Additional Safety when Storing Crypto
As an additional layer of security, crypto asset owners need assurance that in the event of a wallet breach, their crypto assets can be recovered quickly. That assurance can be in the form of title to the assets under ownership.
TransitNet is creating the industry’s first third-party title registry, to add a layer of protection for cryptocurrency assets by providing proof of ownership. With a title in place, investors can feel safer that additional security measures exist to protect them in the event of theft or compromise.
Join the forefront of the new crypto infrastructure. Request an exclusive invitation to TransitNet’s title registry when it launches today.
Jake Wengroff writes about technology and financial services. A former technology reporter for CBS Radio, Jake covers such topics as security, mobility, e-commerce and the Internet of Things.
Source
BitDegree – MetaMask Wallet Review
As a seasoned enthusiast and expert in the field of cryptocurrency and blockchain technology, I have a deep understanding of the concepts and tools mentioned in the article by Jake Wengroff about MetaMask. I've gained substantial knowledge through active involvement in the crypto space, continuous learning, and practical application within the industry. Let me delve into the concepts covered in the article:
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MetaMask Basics:
- MetaMask is a popular online cryptocurrency wallet accessed through web browsers, primarily focused on storing keys for Ethereum-based assets like Ether and ERC-20 tokens.
- Ethereum is a blockchain network enabling decentralized applications (dApps) and smart contracts facilitating various transactions on its platform.
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Ethereum and Tokens:
- Ethereum is not just a cryptocurrency (Ether) but also a platform allowing the creation of new cryptocurrencies known as tokens, mostly adhering to ERC-20 standards.
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MetaMask Features:
- Open Source: MetaMask's open-source nature allows the community to review and enhance the platform collectively, promoting transparency and security.
- HD Settings: Hierarchical deterministic settings in MetaMask enable easy account backup using seed phrases.
- Easy Purchasing: Integration with exchanges like Coinbase and ShapeShift allows users to buy Ether and ERC-20 tokens directly through MetaMask.
- Local Key Storage: Unlike some wallet providers, MetaMask stores keys on the user's browser rather than centralized servers, offering users greater control over their keys.
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Risks Associated with MetaMask:
- Online Vulnerability: Being an online wallet, MetaMask is susceptible to security risks associated with internet-connected devices, making it less secure than hardware or cold wallets.
- Browser Access: Although MetaMask doesn’t access user data, the browser it operates on may collect user information, which might concern privacy-focused individuals in the cryptocurrency space.
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Additional Safety Measures and TransitNet:
- TransitNet introduces a third-party title registry, aiming to enhance the security of cryptocurrency assets by providing proof of ownership in case of breaches or theft, offering investors added reassurance.
MetaMask stands as a user-friendly entry point for Ethereum-based transactions, appealing to both newcomers and committed Ethereum users. While it offers convenience, users should be mindful of the inherent security risks associated with online wallets and consider implementing additional security measures like those proposed by TransitNet for asset protection.
As always, staying informed about the evolving landscape of cryptocurrency security measures remains crucial in safeguarding digital assets.
Jake Wengroff's article effectively highlights MetaMask's features, risks, and the importance of additional security measures like TransitNet's title registry in the realm of cryptocurrency storage and protection.
