Exchange Wars: The Love and Hate of Web3 Wallets
Analyze the Web3 wallets of Binance and OKEx, exploring their characteristics and competitive advantages in terms of security, user experience, functionality, and ecosystem support.Author: JOE
Introduction
With the arrival of the Web3 era, exchange-native wallets have become the focus of market competition. As two major cryptocurrency trading platforms, Binance and OKX have both launched and continuously optimized their Web3 wallets to provide users with a rich variety of services and features. This article will primarily analyze the Web3 wallets of Binance and OKX, exploring their characteristics and competitive advantages in terms of security, user experience, functional features, and ecosystem support. Additionally, we will analyze the market share changes of each exchange's Web3 wallet through data performance, understanding how they rapidly capture market share through unique features and market strategies.
1. Introduction to Web3 Wallets
1.1 What is a Web3 Wallet?
A Web3 wallet is a digital wallet that allows users to store, manage, and trade cryptocurrencies and other digital assets on blockchain networks. Unlike traditional digital wallets, Web3 wallets not only support the storage of cryptocurrencies but also interact with decentralized applications (dApps). Web3 wallets manage user assets and transactions through a combination of private and public keys. The private key is the only credential for accessing and controlling the assets in the wallet.
1.2 Main Functions of Web3 Wallets
Asset Management: Users can store, send, and receive various cryptocurrencies, such as Bitcoin and Ethereum.
Decentralized Application Interaction: Users can interact directly with various decentralized applications through the wallet, such as participating in DeFi protocols and trading NFTs.
Transaction Signing and Confirmation: The wallet provides an interface for signing and confirming transactions, ensuring the security and reliability of transactions.
Security Assurance: Protects user assets through private keys and multi-signature methods.
Cross-Chain Compatibility: Some advanced Web3 wallets support cross-chain operations, allowing management of assets across multiple blockchains.
Anonymity: Although most blockchain transactions are public, users can create Web3 wallets without sharing sensitive data or personal information.
1.3 Risks and Countermeasures of Web3 Wallets
Private Key Management
Risk: The private key is the only credential for accessing and managing assets in the wallet. If the private key is leaked or lost, the assets cannot be recovered.
Countermeasures: Ensure the security of the private key, avoiding online storage. Use hardware wallets for offline management, and regularly back up the private key and store it in a secure location.
Phishing Attacks
Risk: Attackers may impersonate legitimate websites or applications to trick users into entering their private keys or mnemonic phrases, thereby stealing assets.
Countermeasures: Stay vigilant and do not click on unknown links. Use official channels to download wallet applications and regularly check the legitimacy of URLs and applications.
Smart Contract Vulnerabilities
Risk: Some Web3 wallets and dApps rely on smart contracts for transactions and operations. If there are vulnerabilities in the smart contracts, it may lead to asset theft or loss.
Countermeasures: Use audited smart contracts and well-known dApps, avoiding large transactions on unfamiliar or unverified contracts.
Wallet Supply Chain Attacks
Risk: Attackers may steal assets by tampering with wallet software or hardware devices during user installation or use.
Countermeasures: Obtain wallet software and hardware from official or trusted sources, and regularly update wallet software to receive the latest security patches.
User Operational Errors
Risk: Due to operational errors, such as sending to the wrong address or entering incorrect data, assets may be permanently lost.
Countermeasures: Carefully check transaction details, especially the recipient address and amount. Familiarize yourself with the wallet interface and processes, avoiding large asset operations in unfamiliar environments.
Network Security Risks
Risk: Network phishing, malware, and man-in-the-middle attacks may lead to wallet asset theft.
Countermeasures: Use a secure network environment, avoiding sensitive operations on public Wi-Fi. Install and regularly update antivirus software and firewalls to enhance device security.
2. Security Measures of Two Major Exchanges
2.1 Binance Web3 Wallet
The Binance Web3 wallet emphasizes security, employing multi-layer encryption and cold storage technologies to ensure the safety of user assets. Its security measures include:
Multi-Signature: Requires multiple parties to sign off for transfers, enhancing security.
Cold Storage: Most user assets are stored in an offline environment to prevent hacker attacks.
Two-Factor Authentication (2FA): Users need to go through additional verification steps to access the wallet, enhancing account protection.
2.2 OKX Web3 Wallet
The OKX Web3 wallet also focuses on security, with measures including:
Offline Signing: Transactions are signed in an offline environment to avoid network attacks.
Hardware Security Module (HSM): Uses hardware devices to store keys, increasing security.
Security Audits: Regular security audits are conducted to promptly identify and fix vulnerabilities.
3. Comparison of User Experience Between Two Major Exchanges
3.1 Binance Web3 Wallet
As shown in Figure 3.1, the user interface of the Binance Web3 wallet is designed to be simple and user-friendly, supporting multiple languages, making it suitable for global users. Its features include:
Intuitive Navigation: Users can easily find the functions they need.
Friendly User Guidance: New users can quickly get started through tutorials and help documents.
One-Click Operations: Supports one-click transfers, swaps, and other functions, improving operational efficiency.
Source: Binance App Figure 3.1
3.2 OKX Web3 Wallet
As shown in Figure 3.2, the OKX Web3 wallet also performs excellently in user experience, with features including:
Multi-Platform Support: Provides a web version, mobile app, and desktop client, allowing users to manage assets anytime and anywhere.
Customizable Interface: Users can customize the interface layout and theme according to personal preferences.
Fast Response: Optimized loading speed and transaction processing speed enhance user experience.
Source: OKX App Figure 3.2
4. Comparison of Functional Features Between Two Major Exchanges
4.1 Binance Web3 Wallet
The Binance Web3 wallet is feature-rich, covering everything from basic asset management to advanced DeFi operations. Its main features include:
Multi-Chain Support: Supports various blockchain assets, such as Bitcoin, Ethereum, and Binance Smart Chain.
DeFi Integration: Users can directly participate in DeFi projects within the wallet, engaging in staking, lending, and liquidity provision.
NFT Management: Supports the storage and trading of NFTs (non-fungible tokens), allowing users to easily manage digital collectibles.
4.2 OKX Web3 Wallet
The OKX Web3 wallet also offers diverse functionalities, including:
Cross-Chain Interoperability: Supports the transfer and exchange of cross-chain assets, breaking down barriers between different blockchains.
DeFi Platform: Built-in multiple DeFi protocols, allowing users to easily participate in lending, staking, and other operations.
DApps Browser: Integrates a DApps browser, enabling users to directly access and use decentralized applications.
5. Comparison of Ecosystem Support Between Two Major Exchanges
5.1 Binance Web3 Wallet
Binance has a vast ecosystem, and the Web3 wallet, as part of it, provides users with extensive ecosystem support, including:
Binance Smart Chain (BSC): The Binance Web3 wallet is highly integrated with BSC, allowing users to seamlessly participate in various projects on BSC.
Binance Academy: Offers rich educational resources to help users understand blockchain and cryptocurrency knowledge.
Community Support: The Binance community is active, and users can seek help and share experiences on forums and social media.
5.2 OKX Web3 Wallet
OKX also has a large ecosystem, and its Web3 wallet provides support for users through the following aspects:
OKExChain: The OKX Web3 wallet is deeply integrated with OKExChain, allowing users to participate in various projects on OKExChain.
Educational Resources: OKX offers various forms of educational resources, including video tutorials and online courses, to help users enhance their knowledge.
Active Community: OKX has an active community globally, where users can participate in discussions, share experiences, and seek help.
6. Data Performance and Market Strategies
Data objectively reflects the current development status of projects. The data here mainly statistics the weekly active users and transaction volumes of each wallet.
Source: Dune Figure 6.1
As shown in Figure 6.1, overall, the number of active users and transaction volumes of decentralized wallets are on the rise, especially since October 2023, where the growth of decentralized wallet data is very evident. The entire crypto industry also began entering a bull market cycle during the same period, indicating a certain correlation between wallet data and industry cycles.
Source: Dune Figure 6.2
As shown in Figure 6.2, before May 2023, Metamask held an absolute market share, followed by Bitget wallet, which also occupied a certain market share; however, starting from May 2023, the growth of exchange wallets like OKX, Bitget, and Trust Wallet became very evident, squeezing Metamask's market share.
6.1 OKX: Keen Market Insight and Quick Response to Capture Market Leadership
May 2023 was a key month, as the emergence of Bitcoin inscriptions sparked a market frenzy. The OKX wallet quickly supported this and provided a smooth experience, becoming one of the few wallets to support inscriptions. With this wave of Bitcoin inscription enthusiasm, the OKX wallet attracted a large number of users, with almost all users utilizing inscriptions choosing the OKX wallet. This not only allowed the OKX wallet to capture an absolute market share in inscription wallets but also cultivated user habits in managing multi-chain assets, enabling them to easily manage assets across multiple ecosystems.
Furthermore, as seen in Figure 6.2, the OKX wallet has maintained a significant leading position in market share since April 2024. This phenomenon can be attributed to the OKX wallet's continued seizing of important opportunities within the rune ecosystem wave. By capitalizing on the rune ecosystem wave, the OKX wallet successfully expanded its market share, maintaining a lead in the number of active traders and achieving significant advantages in transaction volume. This success is inseparable from its keen market insight and quick response capabilities.
6.2 Binance: Attracting Users Through Significant Financial Investment
Binance's acquisition of Trust Wallet was the earliest among the three, founded in 2017. However, the main business of the exchange was too strong, leading to a lack of emphasis on the "marginal business" of wallets. Now, Binance is beginning to focus on wallet operations, leveraging the technological accumulation of Trust Wallet to catch up.
As shown in Figure 6.2, Trust Wallet's market share has shown a significant upward trend since April 2024. Prior to this, Trust Wallet's market share was relatively low, but after April 2024, its market share increased significantly, gradually occupying a considerable proportion.
This is due to Binance attracting users through a series of market strategies and its own advantages, including:
MegaDrop Event: Attracts new users and activates existing users through large-scale airdrop activities, essentially spending money to attract users. As shown in Figure 6.3, the MegaDrop event offers a large number of token rewards, and users can participate by completing simple tasks.
Large User Base Provided by the Exchange: Binance has the largest number of cryptocurrency trading users globally, providing a solid foundation for promoting and using its Web3 wallet.
KYC Binding: By binding exchange accounts and wallets through KYC verification, the process of managing assets is simplified for users while enhancing security.
Source: Binance App Figure 6.3
6.3 Bitget: Wallet Token BWB for Rapid Market Growth
As shown in Figure 6.2, the Bitget wallet saw a sudden surge starting in March 2024, primarily due to the launch of its wallet airdrop plan. Figure 6.4 shows the airdrop interface for BWB, requiring users to use the Bitget wallet to store assets and trade to earn points, which can then be exchanged for tokens. Since other leading Web3 wallets do not issue tokens, Bitget chose to issue tokens ($BWB) first, attracting active users from leading products through airdrops and then finding ways to retain them, achieving a leapfrog growth.
Source: Bitget Figure 6.4
6.4 Bybit: High Binding of Wallet Airdrops and New Projects
In the Web3 wallet space, other wallets also attract users by binding with key projects. Bybit wallet launched a special new project airdrop center, ByStarter.
As shown in Figure 6.5, the first airdrop of Bybit ByStarter was highly bound to the HLP project, requiring users to register for a Bybit wallet to participate in the HLP project's airdrop activities. This strategy not only attracted a large number of new users but also increased the frequency and activity of wallet usage.
Source: Bitget Figure 6.5
As shown in Figure 6.6, Bybit launched the Taiko (TAIKO) token sale on ByStarter starting May 29, 2024. Before the pre-release price listing, it seized the opportunity to acquire 2,000,000 TAIKO tokens, reflecting the high binding of wallets with new projects.
Source: Bitget Figure 6.6
7. Conclusion
In summary, the Web3 wallets of major exchanges each have their own characteristics in terms of security, user experience, functional features, ecosystem support, and market strategies. The Binance Web3 wallet attracts and retains a large number of users through significant financial investments in the MegaDrop event and KYC binding strategies. The OKX Web3 wallet rapidly expanded its market share, especially during the Bitcoin inscription craze, thanks to its market sensitivity and enhancement of user comfort. The Bitget wallet attracted users and achieved rapid market growth through its airdrop plan. Other wallets, such as Bybit, have also achieved certain success in the market by binding with key projects, particularly through the ByStarter new project airdrop center.
If you seek a more comprehensive feature set and smooth user experience, you may choose the OKX Web3 wallet; if you prioritize security and airdrop benefits, the Binance Web3 wallet is a good choice; if you want to gain more benefits through airdrops and new projects, you can consider the Bitget and Bybit wallets. Choose the Web3 wallet that best suits your needs and preferences to better manage your crypto assets and participate in the blockchain ecosystem.
Risk Warning: The views in this article are for reference only and do not constitute investment advice. Users should comply with local laws and regulations when using Web3 wallets and make decisions based on their own circumstances.
