What is a DeFi wallet?

A DeFi wallet is a solution that provides users with complete ownership over their assets and is positioned as one of the safest storage methods available today.

As an access point, a DeFi wallet provides users with a solution that leaves the power completely in the hands of their owner. This contrasts greatly with a traditional bank, which retains control of all of the user’s assets in its holdings and requires user verification and other related information to do so.

DeFi wallets eliminate the need for a third party, a concept that further revolutionizes the financial industry. Looking at DeFi wallets generally, most operate as Web 3.0 wallets with compatibility on the Ethereum (ETH) blockchain (although this may vary).

Other similarities across these wallets include their compatibility with DeFi applications and their position as a key-based solution requiring users to retain responsibility for the safekeeping of their private key. DeFi wallets also operate with a non-custodial background, ensuring only the wallet owner has access to the funds.

For these reasons, DeFi wallets are among the safest solutions on the market. However, their security becomes a product of the user, who then may find themselves out of luck if they lose their login information.