Binance has recently launched its self-custody Web3 wallet
Self-custody wallets: Self-custodial wallets, also known as non-custody wallets, are digital wallets that allow individuals to manage and store their cryptocurrencies without relying on a third-party custodian, such as a centralized exchange
Web3 wallets: Web3 wallets are designed to interact with Web3 applications, decentralized applications built on blockchain technology. Web3 wallets they can be used to store and manage their digital assets, such as cryptocurrencies, NFTs, and other digital tokens.
Do You Want To Learn More?
All the information you need to create a BINANCE Web3 wallet is readily available at 'Frequently Asked Questions on Binance3 Wallet'
But, in this article, we are going to review some security and safety points that you must know, or at least understand, before creating and using the Binance Web3 wallet
Is Binance Web3 Wallet a Self-Custody Wallet?
Yes, Binance Web3 Wallet is a self-custody wallet
Binance Web3 Wallet employs Multi-Party Computation (MPC) to create three key shares, which are then stored in different locations for added security.
As we will review in short, to access the Binance Web3 wallet, two key shares are required. And Binance has access to only one key share
You, as a user, have access to two key shares.
You own two key shares = You own the wallet
What Is Multi-Party Computation (MPC)?
Multi-Party Computation (MPC) is a cryptographic protocol that powers shared computation without compromising the security and privacy of data
In MPC, there are no seed phrases. Only private keys.
Also, MCP alters the traditional method of storing private keys by eliminating the need to retain them in one sole location.
Therefore, MCP lowers the risk of the keys being compromised and reduces the vulnerability of the system.
MPC Wallet: Key Shares, Backup, and Restore
For the safety of your crypto assets, there are three topics that you should know and understand before using the Binance Web3 MPC wallet.
Wallet Key Shares
When you create a Binance Web3 Wallet, it will generate 3 wallet key shares
Secured by Binance
Stored on the mobile device
Encrypted by the recovery password you entered, and backed up to your cloud storage (iCloud or Google Drive)***.
Cloud storage (iCloud or Google Drive): We know that you use a strong and unique passwordTwo-Factor-Authnetication 2FA to secure your Apple or Google accounts. So, Share 3 is very well protected.
Well done. ??
To access your Web3 Wallet, you must have at least 2 wallet key shares
If one of the key shares is compromised, the remaining two are still securely encrypted to protect your assets.
?? But if a hacker has access to mobile device and cloud storage, the assets can be stolen (but this should only happen to those who are very security and safety negligent)
Wallet Key Backup
To prevent the loss of assets, you need two of the three key shares.
If you lose access to your mobile device, you will need the Binance and Cloud key shares.
Therefore you must:
your Web3 Wallet
?? To be on the safe side, make sure that you still have access to your cloud account
? And store your recovery password securely.
?? And here 'SECURELY' is very important.
Wallet Key Restore
What is the benefit of having a wallet key backup if you don't know how to restore it?
Restoring your Binance MPC wallet seems to be a quite straightforward task, as described in this 'How to restore my Binance Web3 Wallet' guide
Private Keys Emergency Export
As described by Binance: 'Binance Web3 Wallet offers a unique 'Emergency Export' feature. This innovative tool lets users regain access to their assets independently without the need to engage with their Binance account'
This is an important feature because, in case of extreme emergencies, you can export your wallet's private key and restore it to another wallet.
We hope that this article has been of value to you and helped you to better understand the key security and safety aspects of the Binance Web3 self-custody MCP wallet
If you want to learn more, this article about non-custodial wallets may be of interest.
Maybe, if you have one minute to spare, please let me know your opinion about the Binance Web3 wallet.
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