MetaMask may be facing its most severe test since its establishment.

Many encryption users have stated that they have uninstalled the MetaMask plug-in, and many newcomers to encryption who entered the circle through Inscription have not even heard of it. passed this name. We noticed that MetaMask no longer seems as indispensable as it once was. Facing the intensifying external competitive environment, MetaMask's internal product logic has been misaligned, resulting in a sharp decline in its competitiveness. ConsenSys, its backer, focuses on ideology and cannot embed the user-first product spirit into its moat. Although the encryption market has ushered in a bull market, today MetaMask is in an existential crisis.

This is the most fierce market competition since the establishment of MetaMask

MetaMask relied on "zero competition" in the early stage "Environment and the support of ConsenSys behind it have gained an unshakable ecological position in the Ethereum ecosystem. However, with the rise of Bitcoin, Solana and other ecosystems, vertical competition on the wallet track is catching up, and CEX's Web3 wallet products continue to develop. , MetaMask is facing the most fierce market competition since its establishment.

The strong rise of Bitcoin and Solana ecology

In May last year, the Ordinals protocol gained popularity. The wealth effect began to show, and the news of "ORDI per capita increased by a thousand times" spread in various WeChat groups. In the following days, opportunities for ten-fold and hundred-fold coins such as $NALS, $UTXO, and $ELON appeared one after another. A large number of users entered the BRC market with FOMO, and the BRC-20 related WeChat groups, ranging from one group to eight groups, were all full in less than one afternoon. Then starting from October, with the expectation of Bitcoin spot ETF, with Inscription as the core, Bitcoin NFT, infrastructure and other related concepts have achieved extremely high growth. The Bitcoin ecology has risen strongly, in terms of market volume, price performance and other dimensions. Crush Ethereum.

The "Inscription Summer" in 2023, like the ICO in 2017 and the DeFi Summer in 2020, has injected a lot of fresh blood into the crypto world through the wealth creation effect , unlike the previous one that started in Ethereum, this time it happened in the Bitcoin ecosystem, and then spread to various public chains, including Ethereum.

In the early days, as the only on-chain entrance and exit for buying and selling BRC tokens, the Bitcoin wallet UniSat became a name discussed in the entire currency circle, and it was one of the few An early project that truly captures the explosion of the Bitcoin ecosystem. Around May 2023, Dune data shows that Unisat had about 4,000 to 8,000 daily unique users during this period, which was absolutely mainstream in the market at that time.

From the comparison chart of the number of transactions between the Bitcoin and Ethereum networks in the same period, it can be seen that in the second half of 2023, the activity of the Bitcoin network will be significantly higher than that of Ethereum. Therefore, MetaMask focuses on the Ethereum ecosystem. I didn’t get any dividends or traffic growth.

In addition to the rise of the Bitcoin ecosystem, there is also Solana, which has a counterattack script. SOL is one of the leaders in the currency price rebound in the second half of 2023. As of the end of 2023, SOL's market value is US$43.8 billion, a month-on-month increase of 423% , a year-on-year increase of 1106%. Meme coins BONK and JTO airdrops took the lead, bringing the popularity of Solana ecology out of the circle. The meme season that followed even made Solana DEX transaction volume surpass Ethereum for a time, allowing Solana ecology infrastructure projects to gain a lot of revenue, including DEX Raydium and the wallet Phantom.

Phantom is to Solana what MetaMask is to Ethereum. Solana specializes in the non-EVM ecology. Phantom has achieved the best, but it does not stop there. In May 2023, Phantom announced that it would also support the EVM ecosystem, and multiple other wallet products could be added to the wallet. With the strong return of Solana, Phantom has gained a firm foothold on the wallet track and has become an opponent that MetaMask cannot ignore.

Competitors overtaking in corners

MetaMask not only has many competing products in the non-EVM ecosystem Rainbow, another wallet in the Ethereum ecosystem, is targeting MetaMask’s target users through differentiated marketing strategies. It has launched a points program to attract users with airdrops, and has also prepared points for users who have used MetaMask’s transaction function. Rainbow is very concerned about this provocation. "This is not a vampire attack, this is a fox hunt," the strategy states.

Rainbow wallet uses two emojis to represent "Operation Fox Hunt"

The special thing about Rainbow is that it has access to Coingecko data and the token price The changes are directly displayed on the token trading interface on the plug-in side. Users can view the price changes of tokens on an hourly, daily, weekly, monthly and annual basis without jumping to other pages. For users, they often need to check the price fluctuations of tokens while trading tokens. This function fits the user's usage scenarios very well. MetaMask only provides token trading functions on this interface. Users need to click "Portfolio" to jump to the web page to view the increase and other information.

MetaMask’s competitors go beyond independent wallet products, as well as DEX and CEX. Previously, Coinbase launched its own wallet Coinbase Wallet, and later Uniswap launched its own wallet Uniswap Wallet, because everyone has realized that the wallet is the core starting point in the business scenario. If you grasp the wallet, you will have a traffic entrance, which can form a business Closed loop, and in this regard, MetaMask's rival is OXK's Web3 wallet.

As mentioned earlier, Unisat has become a new wallet force by seizing the opportunity of the Bitcoin ecosystem, but the biggest winner of BRC-20 is actually OKX and its Web3 wallet. The BRC20 craze started by Unisat lasted until the end of May 2023, and then the inscription market fell into a trough due to safety doubts. However, the launch of BRC20 and Ordinals NFT transactions by the OKX wallet in June restored the entire market’s confidence in the Bitcoin ecosystem. In October, the OKX Web3 wallet plug-in reached 200,000 downloads, and at the time of writing, it has 500,000 downloads on the Google Play store.

But OKX Web3 wallet leverages market share through inscriptions and gives users more unexpected experiences. I realized this because I saw such a tutorial on buying coins in a community. Before this, the author had never used functions other than the OKX Web3 wallet mobile BRC-20 market to conduct on-chain transactions, so when I saw this This simple trading tutorial can’t help but be a bit unbelievable, “Is it so convenient to buy coins on a mobile phone?”

At first, I didn’t even find the entrance to copy the DEX official website, but After completing the transaction through the mobile wallet, everything is just like Web2's RSS subscription service, and the experience is very smooth. However, the presence of Xiaofox on the mobile phone has not always been very high, and the tools for users to access business scenarios will bring an obvious sense of experience segmentation. Specifically reflected in the product data, the registration conversion rate of new users is very low, and the completion rate of calling MetaMask for signing in mobile business scenarios is also very low.

In addition to the mobile version, the plug-in version of the OKX Web3 wallet can be seen from the UI interface. Compared with the MetaMask wallet, the OKX Web3 wallet provides more detailed improvements. . For example, in the "Select Network" section of the wallet, the MetaMask on the left needs to be added manually. The OKX Web3 wallet on the right displays all supported networks and provides the "All Networks" option for users to view all assets in the account. In the currency display interface, the OKX Web3 wallet not only displays the quantity and balance, but also displays the current price and increase or decrease of the currency.

Left: MetaMask plug-in interface Right: OKX Web3 wallet plug-in interface

Some users in the community reported that OKX Web3 wallet and MetaMask conflicted on the web page. When connecting to Little Fox Wallet, the OKX wallet option will always pop up, which shows the efforts made by OKX Wallet in grabbing user market share. But behind the scenes, we should pay more attention to the fact that the Web3 industry is transforming from a cryptopunk-friendly financial game to a mass-friendly consumer application industry. No matter what the attitude is, grabbing users is the most important thing for a product’s long-term survival.

It is difficult to create a new moat for MetaMask due to its developer orientation

Phantom Brandon Millman, CEO of the wallet, once said, "It is obvious that MetaMask is built by developers for other developers. This actually makes sense, because most users of Ethereum were developers in the early days."

The user education cost of blockchain products is very high, and the wallet is the most basic but also the most critical step. MetaMask benefited from the support of the Ethereum community in its early days. At that time, "zero competitive environment" was the best barrier for Metamask wallet to occupy a huge market share, and the cost of user education was very low because all users were developers. Developers are also all users. This developer-oriented approach to product change has given many new wallet products that focus on user experience the opportunity to carve up MetaMask’s market share.

In MetaMask's product strategy, user experience is not its first consideration, or for ordinary consumers compared to developers Users are not MetaMask's main frame of reference when building products. This all stems from MetaMask’s clear positioning of itself not to compete with wallet categories with low barriers to entry, but rather to open up the functionality of the wallet to expand its possibilities. In the short term, it is difficult for this strategic layout for developers to establish an effective moat and obtain excess returns in the current competition in the encryption market.

Pay more attention to developers

If you are a builder of wallet products, I believe you will definitely MetaMask is no stranger to product updates in recent years; but if you are just an ordinary end user, the operating experience of the MetaMask you used two or three years ago does not seem to be any different from the MetaMask of today.

In October 2020, MetaMask launched the aggregation DEX service "MetaMask Swaps", allowing users to directly exchange tokens based on MetaMask. Through this function, MetaMask finally has A sustainable revenue model, but this is also one of MetaMask’s rare product updates that is user-friendly for ordinary wallets.

MetaMask reached US$200 million in revenue in 2021 through the Swap function

MetaMask is targeting both a large user base and the ability to pay in 2021 of institutional clients launched MetaMask Institutional (MMI) to bridge the gap between traditional financial structures and blockchain technology. In January 2022, MetaMask launched the developer version "MetaMask Flask". Developers can build MetaMask Snaps through Flask and extend MetaMask's functions at runtime without MetaMask's participation.

Until September last year, the first version of MetaMask Snaps was officially launched, providing 34 Snaps including transaction insights that can identify potential security risks, and Bitcoin, etc. Features such as interoperability of non-EVM chains and Web3 notifications. However, as an ordinary user, it seems that there is no substantial experience improvement in this update.

MetaMask Snaps require users to add them manually, which is a very cost-effective option for users who are not familiar with Snap product logic. More than 30 Snaps include many functions. Just like the mini programs launched by WeChat, users can get many incremental experiences or include behaviors outside the ecosystem. However, this is based on Snap's indispensable ability to break the circle. Otherwise, users have no way of knowing what they can do with these Snaps, just like a small program failing to start cold.

For example, the EthSign developer team created a universal password manager called KeyChain based on MetaMask Snaps. All browser passwords can be encrypted and encrypted using wallet keys. storage. This itself is a very marketable product concept, but it has not achieved a circle-breaking effect. Or the Dialog function of MetaMask Snap can pop up a separate window, similar to the traditional alert/confirmation/prompt dialog box, which is used for transaction reminder, confirmation and information submission respectively, but obviously this does not help to improve the user's trading experience. Not big.

Source: LXDAO

Although each user using the MetaMask wallet can set up different Snaps according to their own needs to meet personalized needs, MetaMask Snaps It does not solve the problem of the high threshold for using crypto wallets, and it does not achieve the purpose of acquiring new users. It is more about providing existing users with a better experience and more functions to retain current existing users.

MetaMask product manager Alex once said in an interview that the entire team is very clear about MetaMask's positioning, and its main purpose is not to compete with the wallet category with low entry barriers. , rather lies in opening up the functionality of the wallet to expand its possibilities. For example, if developers want to enhance security by using advanced encryption technologies such as multi-party computation (MPC), threshold signature scheme (TSS), etc., they can create a Snap and attach it to MetaMask to achieve this functionality. Or for those working on developing account abstraction solutions, they could also develop a Snap and attach it to a MetaMask to extend its functionality.

"We have our own internal ideas, but we also want to make MetaMask flexible and adaptable to future technology developments." It can be seen that the MetaMask team is still focused on serving the developer-centered user group, but still maintains a relatively ambiguous attitude towards consumer user-level user experience, account abstraction and other technologies. This is why MetaMask Snaps has not been used in general since its launch. The reason for causing too much splash among the user community.

It is also worth noting that MetaMask does not adhere to the "user first" principle in the feedback channel. The Google plug-in store can see many user feedback contents and No response from customer service. When responding to MetaMask product issues on Twitter, phishing accounts and fraudulent links often appear in the comment area.

Vision Maniac ConsenSys: We will not enter the sinking market

MetaMask did not choose to enter the sinking market. The core reason is that the parent company behind it, ConsenSys .

As mentioned earlier, after several years of hard work, MetaMask has now become one of ConsenSys's most successful incubation projects. In addition, ConsenSys also has development kits Infura, Smart contract audit service Diligence, Ethereum Layer 2 Linea, Ethereum client Teku, Besu and other product sections.

The reason why ConsenSys is called a "vision maniac" is because it is different from other for-profit companies in the encryption world that are purely driven by economic interests. Project construction. Its founder, Joseph Lubin, is one of the co-founders of Ethereum. ConsenSys seems to have inherited some of Ethereum’s genes and uses the encryption vision as a compass for business layout.

In 2023, ConsenSys’ Linea mainnet was launched, MetaMask Snaps was released, and activities such as the Web3 Fellowship program and Linea DeFi Voyage were launched. In September 2023, in order to better support Web3 builders, Consensys announced the closure of its development tools Truffle and Ganache, turning the Truffle team's focus to expanding its Infura, MetaMask Snaps and SDK products.

It can be said that the role played in the encryption world is mainly to build infrastructure, and will not pay as much attention to polishing product details as CEX, which directly targets the majority of users in the market. , which is more like serving the Web3 industry than Web3 users.

MetaMask co-creator Aaron Davis once said in the sixth anniversary blog that "most of the things in the popular Web3 will not appear in 20 or 30 years." ”, he focuses more on tracking themes and forms rather than details, so the MetaMask team’s goal for Web3 is to build a “civilization starter kit”. It can be seen that MetaMask executives also pay more attention to narrative and talk less about details in terms of development vision and product specific development strategy.

MetaMask does not want to serve users, but wants to promote its products in a safer and more stable way. However, in the short term, the logic of such a product is very complicated. It is difficult to once again establish an effective moat for MetaMask to face today's market competition. Because infrastructure and developers are of course crucial to the development of the entire industry, but when it comes to whether specific products can exist, it is always the users who have the final say.

Wallet is still the breakthrough point for Mass Adoption

Back recently, due to the recovery of the encryption market, More and more projects have launched interactive, testing or points activities, which makes it a bit cumbersome for users to manage assets and switch between different ecosystems. We used to say that there are countless chains, but now we have to say that there are countless wallets.

MetaMask is still the wallet with the largest market share today, but MetaMask has not received consistent evaluations in terms of user experience with its status in the world, despite the technical support of the entire MetaMask team. Very good, but they prefer to regard MetaMask as infrastructure and launch development tools for developers rather than consumer projects. This product change idea can also be seen from the launch of MetaMask Snap.

The role of the wallet in the blockchain world is very special. It does not directly store value, but only serves as an account for users to manage assets on the chain. Therefore, the wallet is very It is difficult to build your own moat with technology.

Now the wallet market has entered the stage of sinking the market and competing for user shares. As the product closest to users in the blockchain infrastructure, the user experience is A wallet is the simplest and most important way to build a moat. MetaMask’s developer-centered product strategy and the mission of the new cycle wallet are misaligned.

By observing users and new technical directions, the most difficult problem is that the account system itself is not easy to use. A novice who wants to enter Web3 cannot be required to learn how to do it first. Adding RPC to MetaMask is very impractical. And even for chain veterans, the complicated process of transferring assets, conducting transactions, and pledging assets between countless chains can be tiring.

Last year, Paradigm proposed "intent-centric", bringing a new idea of ​​"intent-centered" Web3 interactive experience to the encryption world - putting The complicated operation process in the past is made invisible, and users can achieve their goals in an intuitive and direct way. Ideally, users only need to issue an intention command, and all operations can be automatically performed behind the scenes. This concept seems to be the best catalyst for the wallet to complete Mass Adoption.

"Security" is definitely the lifeline of a wallet's survival, but "traffic" is more like the short board on the barrel. This article is not intended to criticize different wallets, but simply to observe the situation of MetaMask in the entire wallet track and possible problems from the perspective of an ordinary user. To rely on "intent" to achieve large-scale user adoption also depends on the optimization of protocols and infrastructure. When the cross-chain infrastructure is not yet complete, a good wallet may be the most important cross-chain product for ordinary users.