New Huobi research has revealed that the number of crypto wallet users worldwide grew by 6.3% to 85 million as of November 2022.
According to the report, non-self-custodial wallets could potentially introduce Web3 users to Web2. These wallets can do this because they have simplified the onboarding process and the complexity attached to the crypto industry. Wallet security is a must-have infrastructure in the blockchain ecosystem. A recent report by Huobi stated that wallets are among the most critical infrastructures for new users to join the crypto space.
Crypto wallets have generated revenue of over $1.4 billion in the last year alone. The earnings of this company are expected to reach $3 billion within the next ten years. Crypto wallet usage came to the fore during the recent FTX implosion, where many analysts highlighted the importance of having your own key. Several crypto hardware wallets like Trezor and Ledger reported a surge in demand due to the FTX contagion. During the peak of its run, reports revealed that roughly 15 million Bitcoin went into self-custody.
Despite the huge success of 2022 in the space, the industry still faces many challenges. Huobi highlighted the challenges faced by crypto wallets today: user friendliness, security, privacy, and regulation. According to Huobi, most wallet brands have poor interactions with their users. A major discussion surrounding the collection of data by ConsenSys (MetaMask’s parent company) was raised when it was revealed that it would collect users’ IP and ETH addresses.
The CEO of Binance stated that 99% of people are going to lose their self-owned investments, that doesn’t mean that they shouldn’t try. These people have no way of storing their security keys properly, and may be losing sensitive information. He added that there are other challenges self-custody poses to users that a central exchange might be able to solve.
The main point of crypto is to be decentralized and self-custodial wallets are essential for users to have full control over their digital assets. It’s obvious why central exchanges fears the rapid growth of self-custodial wallets use, but everyone’s financial safety should be prioritized on their own accord by taking control over their own finances by choosing decentralized self-custodial wallets. There are two kinds of non-custodial wallets, digital and hardware wallets. Education is very important to be able to make the difference between non-custodial and custodial wallets, this is why we, at tokenpaddock are devoted to educate people through our online courses by teaching them how to use non-custodial wallets, the differences between them and the importance of them.