XDEFI Wallet, your reliable companion in the multichain world
Note: This article was published on January 28, 2022 – The ecosystems, in particular Terra, have evolved significantly since the time of writing.
DeFi – It All Started On Ethereum
Time is relative. Half a year can feel like an eternity when you are engaged in the cryptocurrency sector, as so much can happen in such a short space of time.
But can you still remember the summer of 2020?
It was DeFi (Decentralized Finance) blooming season where the DeFi protocols that had been in existence for a while suddenly gained traction (like ETHLend =Aave and Synthetix) and new blue-chips were born (like Compound, Curve or Yearn).
What do all of these protocols have in common?
They were all running exclusively on Ethereum. But then, only a few months later, in 2021, additional EVM (Ethereum Virtual Machine) based networks such as Binance Smart Chain, Polygon, Avalanche and Fantom started to see serious traction and Terra and Solana emerged as two robust alternative smart contract blockchains.
A Rotation of Users and Capital
They all managed to attract large communities and investors, partly because of the cheaper fees and faster transactions they were offering and due to deep liquidity incentive programs, which led to some extraordinary yields on deployed capital.
But the main driver for growth is having developers pushing out new protocols and helpful tools. EVM-compatible networks like the ones mentioned above had the advantage that existing code could easily be migrated over from Ethereum to new networks as it is basically the same stack.
Additionally, lower gas fees made it more cost-efficient to publish contracts and perform other gas-intensive actions. Solana and Terra on the other side had a tougher start as their stack is not compatible with the Ethereum Virtual Machine, as both networks rely on Rust as a programming language. On the other hand, Rust is very popular (for example, it has been Stack Overflow’s most loved language for multiple years in a row), solving many pain points that exist in other languages. This helped both Solana and Terra to attract a lot of new development talent.
Also, the NFT craziness of 2021 played an important role. NFTs attracted many people with almost no background in cryptocurrencies and blockchains. Whereas the “old guard” is still active on Ethereum, as are the the famous NFT blue-chip projects like CryptoPunks or Bored Apes Yacht Club, the new joiners are less sensitive to centralisation issues and were put off by the ridiculously high fees that we have been seeing on Ethereum.
So both these new users as well as the creators of new NFT concepts – mainly in the area of “Play-to-Earn” games who are extremely dependent on low fees – found a new home in alternative layer 1 blockchains or even gave birth to dedicated sidechains, such as Ronin in the case of Axie Infinity.
An Unwanted Fragmentation
The growth of multiple competing layer 1 blockchains also led to various adverse side effects, the biggest one being the fragmentation of products and capital.
The whole crypto ecosystem would be interconnected and easily accessible for everyday users in an optimal world. Still, right now, new users are overwhelmed with different options, are forced to critically assess the underlying blockchain platform and often face unbelievably clunky user interfaces. Additionally, the available liquidity is spread across dozens of blockchains and protocols, leading to capital inefficiency.
Existing decentralized bridge solutions, which are trying to allow users and capital to migrate between blockchains easily, still have a lot to work on and improve both from a security standpoint and a UX perspective.
It is early for decentralised bridges and it will take a some time for them to scale while maintaining a high level of security. Therefore, most people currently rely on centralised exchanges when it comes to moving capital from one blockchain to another.
Wallet Compatibility and Horrendous Fees
The experience around hardware wallets – although they are vital for securing one’s digital assets – is terrible when it comes to interacting with wallet extensions, both from a developer and a user perspective. These frictions are another challenge services that stay true to the non-custodial handling of crypto and decentralisation face when competing against the smooth UX of centralised exchanges.
And then there are also fees in a multi-chain world. Gas and transaction fees are, in general, a pain to deal with on Ethereum alone because of their cost basis and it is also cumbersome to have to make sure that a user’s wallet has a sufficient balance of e.g. $MATIC, $BNB, $SOL, $UST, $AVAX to be able to perform a transaction on the respective chain.
XDEFI Wallet, your reliable companion in the multichain world
For a multichain world to flourish and allow new users to navigate easily within it, we need these ecosystems to be truly interconnected and the user experience of core tools like wallets to increase tenfold.
This is precisely what we will be focusing on at XDEFI Wallet for 2022.
We want to become a cruise ship for crypto users by catering for both laid-back beginners dipping their toes in the crypto and DeFi world and experienced DeFi power users.
When you board a cruise ship, you instantly have the essential amenities readily available to you, including, for example, restaurants, bars, pools and a gym so that you can spend your entire vacation on the ship. However sometimes you want to explore a destination and leave the vessel, but when you come back on board, you are always pleased to be back in a safe and warm familiar environment. Some people may even want to jump off the ship at every destination and only eat outside for example.
The XDEFI cruise ship guides you through a multi-chain world.
This is precisely how XDEFI works by directly integrating the most important use cases into the wallet, like depositing stablecoins for yield, swapping tokens, or bridging them between chains. So some users are perfectly fine by using only the functionalities available in XDEFI Wallet directly.
On the other hand, more experienced users have the best multi-chain Web 3.0 wallet at hand to interact with any decentralised protocol out there and put their assets to work.
But they always come back home, knowing their digital assets are safe and secure.
XDEFI Wallet’s mission to improve the multichain wallet experience
Let us also talk a bit about where we want to set the focus to achieve all of this. Our mission has always been to provide a seamless experience for our users while interacting with decentralised products.
XDEFI Wallet allows savvy users to navigate any ecosystem while it provides aggregated solutions for new joiners more comfortable with accessing everything in one place.
We want to provide the best possible security for your digital assets without compromising the user experience and ease of use in general.
Access natively integrated DeFi features such as Anchor / Orion Money to generate a yield on your stablecoins. Single-sided staking for EVM assets will also be added to allow users to easily access yield generating products while removing the friction associated with dApp interactions (transaction signing pop-ups, etc.).
The days where you needed to search tirelessly for a decentralised bridge to move token X from chain A to B will be over soon. XDEFI Wallet will allow you to bridge tokens within the wallet itself with just a few clicks.
Intelligent fee management.
We care about both low fees and the utmost convenience for our users. Therefore, we will implement seamless and intelligent fee management to always pay as little fees as possible and so that users don’t have to manually manage their gas tokens.
We will integrate more blockchains and single-sided staking directly within the wallet for a multitude of assets.
NFTs have become a staple for most crypto users; we will continue to support this development with the best NFT management experience and valuable tools for creators and collectors.
A browser extension has only been the first step for us; we will soon offer a native mobile app as well as a web app so that you can use XDEFI Wallet from every possible device.
We will continue to ship and make our suite of products better. This is our promise to you.
You can also look at our detailed roadmap for Q1 2022.
See you onboard the ship and our discord !