Extension wallets are a convenient way of accessing your crypto wallet through your web browser. They work like any other browser extension and provide good functionality while being restricted to just a small icon on the top right corner of your browser.
Storage is one of the most important aspects of owning cryptocurrency. Over the years, the need for safe and convenient crypto storage has resulted in the introduction of dozens of different wallet solutions, including offline, online, desktop and even paper wallets.
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However, perhaps the latest addition to this long list of options is the browser extension wallet. Tag along as we unpack all there is to know about these easy-to-use crypto storage solutions.
What are extension wallets?
Extension wallets are a convenient way of accessing your crypto wallet through your web browser. They work like any other browser extension and provide good functionality while being restricted to just a small icon on the top right corner of your browser. On clicking the icon, you're exposed to a larger interface with more functionality when you require it.
Also, with companies like MetaMask & Coinbase, creating and using a browser extension wallet from scratch is quite simple. All you have to do is Google the provider's name, add the extension to your browser, click on "create a wallet", choose a username and then safely store your key phrase.
Please note that the key phrase is universal and can be used to transfer funds from any provider, but passwords are provider specific. If you lose your password or key phrase, extension wallets or wallets, in general, usually have no recovery process, and the crypto stored within them could be lost forever.
How are extension wallets helpful?
Browser extension wallets are helpful as they're easy to create, and even beginners can intuitively create a wallet and get started. Second is the availability of your wallet where you most need it. The odds are that you mostly use crypto or NFT-related websites on your laptop or phone browser, in which case you will be able to access them immediately.
Third and most importantly, browser extension wallets usually provide you with connectivity to many Web3 portals like OpenSea. You don't have to log in every time; your wallet will be ready to use when you need it.
Popular extension crypto wallets
Being one of the most popular crypto wallets, MetaMask works with every major web browser, including Chrome, Firefox, and Edge. It is easy to download and use as it explains every aspect of the wallet when you are getting started. It supports an in-wallet crypto swap system that saves you from the tedious task of transferring crypto onto an exchange platform for swapping. It is also suited for many major hardware wallets available in the market.
Coinbase offers self-custodial extension wallets. And since it is one of the largest crypto exchanges, it also provides various direct facilities for which you'd otherwise have to reach out to exchanges. Additionally, it supports non-EVM coins like Doge and more. The two disadvantages are that it is not as universally supported as MetaMask, and it doesn't guide you through the setup process as well as others.
Brave is one of the few browsers with an in-built wallet that supports Ethereum and Solana chains. The browser is easy to download, and also provices browse-to-earn rewards in the form of its native BAT token. It lacks widespread dapps support, unlike the wallets mentioned above. The browser itself gives you an experience of a Web3 internet, a glimpse into what the future might be like.
Disadvantages of extension wallets
The prime disadvantage of an extension crypto wallet is the fear of a hack. While wallets cannot inherently be hacked - the browser could be. And with the increase in browser extension wallets, there is also an increase in attempts to hack into them and steal crypto assets.
Also, these wallets are online wallets, making them more susceptible to exploits. As such, there is a bit of security compromise for convenience, which remains the only major drawback for these crypto wallets.
As someone jumping into the cryptoverse, extension wallets can be a good first wallet. They are easy to use and guide you through the process of sending and receiving crypto. Just remember to compare several extension wallets and choose the one you find the easiest and most intuitive to use.