Crypto Wallet — How to Survive the Winter?
By: Bitpie Wallet
Tags: Bitcoin Wallet, Defi, Lightning Network, Dapps, Bitpie

To survive, a crypto wallet has to do more.

Payment needs can be regarded as one of the origins of crypto assets, and this scenario has naturally been followed by many teams. In the past, many teams have made attempts in this field, but the major business model formed by such attempts is to provide payment platforms for merchants and to draw a certain percentage of commission for each purchase received by merchants. In such a scenario, if the crypto wallet is only used as a tool to complete an on-chain transaction, there is no way to charge users. Some wallets have chosen to work with Visa or Master to issue bank cards that can be used easier in the off-chain world and share some revenue as one of the payment channel participants and OTC desk. This could work.

The Lightning Network is another payment solution native to the crypto community. In the Lightning Network ecosystem, wallets can receive some fees by providing node services.

However, none of those attempts has changed the reality that encrypted assets are only accepted as a payment medium in a very small range. It is a bit difficult to make good money on this. However, with the rapid development of stable coins, a large number of users are rapidly pouring into crypto payment scenarios. These users are directly or indirectly bringing income to the wallet, and the growth rate is amazing.

The production of crypto assets (Mining) is one of the few fields in crypto world that generate income steadily in the past decade. A lot of players are crowded in this field, they have their own strengths, work together, and share the pie. Unfortunately, crypto wallet is not among them. However, with the launch of more and more PoS networks, crypto wallets were introduced into the production process finally, and stood directly at the forefront of the industry chain. There is a new name now: Staking.

More and more PoS network are squeezing into the top 30 of CoinMarketCap. The total output volume from staking can reach tens of billions of dollars per year, a considerable amount of revenue would be generated within crypto wallet by providing services around Staking.

The largest piece of income comes from third party applications. With the improvement of experience and the formation of user habits, both centralized and decentralized third-party services are increasingly accepted by wallet users. As a tool for users to manage assets, such services and wallets have a strong coupling effect.

DeFi applications, in particular, are developing rapidly and are bursting with tremendous energy and innovation. As the DeFi application network continues to mature, the asymmetry between centralized and decentralized services will be gradually erased, and the security and other advantages of open finance will be fully reflected. The cross-chain technology is also evolving rapidly, and each major blockchain will soon be connected to form a huge parallel universe. The stable coins and offchain assets projection will act as a wormhole to connect on-chain and off-chain universes. A lot of assets and users are entering the chain through these wormholes, forming a huge cross-border financial network.

The crypto wallet is the entrance of this financial network, and it is also the navigator of people in this complex network.

And DeFi is just a small part of the DApp world. The prosperity of DApp will directly bring huge revenue to the wallet. We have seen it once on the EOS network on winter 2018. Although the prosperity lasted only a few months, leading EOS wallets all received a lot of income, even enough to support them for years. This short period of prosperity is also a precious sample, many imaginary scenes become reality and many problems were exposed. Everyone learned something.

A year and a half have passed since then, we can see major blockchains such as Ethereal and EOS are evolving rapidly, and a lot of team are proposing new ideas and working hard to implement, the ability of DApp teams are rapidly improving as well. I am confident that a greater prosperity of DApp will return in the near future.