Here’s the TL;DR summary:
- Find a non-custodial project you don’t need to trust, (automated smart contract logic) that offers almost fool-proof options (some can’t be saved, but we’re sure that’s not you if you’re reading this)
- Opt for a simple All-In-One decentralized solution that makes life simple
- Find a platform that is constantly innovating and updating at the cutting-edge of web3
Now that those foundations are covered, we recommend our non-custodial smart contract wallet Pillar Wallet. More on this later
Firstly, if you’ve been in the game for any amount of time (besides 10 seconds) you’ve heard the acronym DYOR. But what about SYOF? Ok… nobody’s heard that because I just made it up but Secure Your Own Funds should be a thing!
Maybe it’s because of my distrust of authority but securing my own funds has always been very important to me, but when I hear about thousands of people losing their life savings because of what seems to be greed and dishonesty on a massive scale, it sickens me but also it inspires me to revisit the topic of the best way to take part in non-custodial investing.
“A lot of the problems that DeFi solves users don’t really care about until it affects them personally. But when it does it’s like catastrophic, right?“– Hayden Adams Uniswap Founder
Often when new users begin dabbling in crypto investments, the very idea of digital currencies; the sheer scale of different tokens; and why they might or might not be valuable is so overwhelming initially. So, when decentralisation principles come up it’s a stretch too far for them and they just stick with the Binance’s, FTX’s, Coinbase’s & Crypto.com’s because it’s easier.
These organisations are centralized exchanges offering custodial wallets. Meaning at the end of the day, they own your funds until they grant you access to them. At any point they can freeze your assets.
What new users often fail to take note of is that it’s easier to lose everything by entrusting funds to largely unregulated, controlling organisations, like we’ve seen with Mt. Gox, FTX and more, than losing them with decentralized alternatives. Also these alternatives drive us to take more responsibility for our funds (SYOF)
If this article assists just one person to avoid such a fate – it’s mission completed.
What Do You Need To Successfully Go Self-Custodial?
First off, you’ll need a non-custodial wallet. These could be browser-based extensions; come in the form of mobile or desktop apps; or they can be hardware devices. The latest and most future aligned version, is smart contract based wallets secured by immutable smart contracts. Pillar Smart Wallet is one of the best, battle tested smart wallets around, boasting state of the art functionality in a simple user-friendly format, basically, you won’t need a degree from MIT to rock web3 and surf account abstraction waves.
Smart wallets have to be deployed to their linked blockchains before they are able to be used to send (they can receive). This costs a gas fee charged by the chain network.
Pillar Wallet bundles this transaction into your first outgoing transaction to reduce network deployment fees. We also subsidize the deployment fees on Polygon & Gnosis Chains for our users, meaning deployment on those chains is free! ( a tx fee for your transaction will still apply but deployment will be free) In order to deploy your wallet on these chains simply perform your first outgoing transaction using that particular chain in Pillar Wallet
Again, non-custodial wallets can come with their own risks if the code is dodgy so make sure the one you choose is open-source and the code has been audited, like Pillar Wallet. Our under the hood architecture code (Etherspot.io) has been audited by Consensys Diligence and we’ve run ImmuneFi hacker bug bounties on Pillar Wallet, with the code standing up to the test.
Pillar Wallet gives you:
- Seamless exposure to multiple blockchains
- In-app cross-chain swaps between assets easily and at low fees (Using L2 Ethereum compatible chains means a gas fee saving of over 100x compared to Ethereum mainnet)
- The ability to pay gas fees in any stablecoin you hold no matter the network / chain you’re transacting on
- The power to connect to decentralized exchanges or any other DeFi dapps from the in-app browser
- The ability to buy crypto directly with a card or bank transfer via implemented on-ramp solutions
- Smart contract secured NFT support
- Pillar Wallet
So the problem with centralized exchanges (CEX) is that they are…well… centralized. If they go bust or code a backdoor (sound familiar?) then poof!…your funds are gone.
They’re basically the banks of crypto.
Some of the best known centralized exchanges are
- FTX (no longer…)
I’m not saying these guys are all going to rug pull on you but… they could, in theory.
Decentralized exchanges (DEX), on the other hand, are an option for users to connect their externally owned wallets and bypass the middleman. They allow users to trade, swap & invest without having to hand over control of their assets to an unknown player. Again, risks may exist if the code which executes the transactions are poorly written or contain bugs, so stick to the tried and true dex’s like
- There are many others that are equally as good, but DYOR.
Decentralized finance (DeFi) is an emerging financial technology based on secure distributed ledgers similar to those used by cryptocurrencies.
In the U.S., the Federal Reserve and Securities and Exchange Commission (SEC) define the rules for centralized financial institutions like banks and brokerages, which consumers rely on to access capital and financial services directly.
DeFi challenges this centralized financial system by empowering individuals with peer-to-peer digital exchanges.
DeFi eliminates the fees that banks and other financial companies charge for using their services. Individuals holding assets in a secured owned wallet, can connect them to the DEX app and swap or provide liquidity in minutes, and anyone with an internet connection can use DeFi.
Pillar Wallet enables users to interact safely with DEX’s by removing the risk of linking to scam apps parading as legitimate decentralized exchanges. This is safely done by accessing the official links to the legitimate app through our in-app browser and connecting your Pillar Wallet directly.
Without giving financial advice, I’d recommend going decentralized and non-custodial to avoid the bad actors in the crypto and blockchain space. Even the most seemingly trustworthy characters can turn out to be ultra dodgy.
Pillar Wallet has been innovating in the field of decentralization and self-custody since 2017 and continues to push out a suite of tools driving simplification of web3 processes for both developers building in Web3 and everyday users who want to take control of their financial futures.
Stay safe and SYOF! :))
Pillar DeFi Smart Wallet
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Etherspot Account Abstraction SDK
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