Crypto Wallet Usage Increases Globally: Report Says

The use of cryptocurrencies continues to rise worldwide, along with the growing need for effective security solutions.

Key Points

• The global growth in cryptocurrency use demands more effective and accessible security solutions.

• Zelf introduces an innovative architecture by storing seed phrases on the blockchain, removing the need for dedicated hardware.

• Poor user practices and a lack of secure, convenient solutions have led to massive losses and mistrust in self-custody.

According to a report by Statista, it is estimated that by 2025, there will be over 320 million cryptocurrency users worldwide, a 30% increase from the previous year. 

Protecting digital assets has become a top priority with this growth, and digital wallets play a key role in this landscape. However, how these wallets store and safeguard private keys remains a subject of debate.

In an environment where digital security is becoming increasingly critical, Zelf proposes a radically different architecture for protecting digital assets. Johan Castellanos, CEO of Verifik.co and DAO Leader at Zelf, explained the key differences between traditional wallets and their innovative approach.

"Hardware wallets are more secure because they are designed exclusively to store private keys," notes Castellanos. "Since they don’t run multiple apps like phones or laptops, the risk of hacking is drastically reduced." However, convenience remains a challenge. Hot wallets, for example, are easier to use but store seed phrases locally. "This makes them vulnerable, especially when users enable automatic backups," he warns, citing an article from The Block on Metamask, the most widely used hot wallet on the market.

Zelf proposes a new paradigm: storing the seed phrase on the blockchain, not on the device. "This eliminates the need for dedicated hardware and significantly reduces the risk of key loss or theft," Castellanos explains. Although integration with traditional wallets isn't straightforward due to architectural differences, Zelf allows users to import seed phrases from other devices, simplifying the migration to a more secure solution.

Regarding current user practices, Castellanos is critical: "Many still take screenshots of their seed phrases, which is a serious mistake. Others write them down on paper, which risks being lost or damaged." In contrast, physical solutions like Trezor’s metal plates offer greater durability, albeit at a high cost.

The lack of good practices has contributed to massive losses: an estimated $7 million is lost daily due to hacks or misplaced private keys. In this context, it’s no surprise that many users prefer centralized exchanges (CEX) over decentralized platforms (DEX). "They trust third-party custody more than their ability to protect their assets," Castellanos comments.

With Zelf, security doesn’t have to compromise user experience. The vision is clear: a Web3 where self-custody is as secure as it is convenient.