Wallets and DApps and DeFi, oh my!
That was the general sentiment echoed by an Iconist Twitterer named Mitos, who recently expressed frustration over the confusing state of currently available ICX wallets:
We here at The Iconist have seen this sort of general confusion pop up many times over the past few months, with multiple people complaining to us that they don’t understand which wallets to use for which purposes.
We asked Mitos about her experience. In Mitos’ case, she came into ICX investing in March 2021 — right around the time that DeFi was gaining popularity on the ICON Network, with ICONFi having just launched and Balanced coming right around the corner. It was also around the same time that ICON started phasing out support for its two ICONex wallets and the MyIconWallet and Hana wallets were in the works.
“I decided to buy ICX at a very opportune time for a bull run, so my bags started to do very well very fast,” Mitos says. “But when I wanted to move my ICX into the ICON ecosystem, right from the get-go I really couldn’t tell the difference between the available options. All you see are little links on Reddit and other forums for ICONex and Hana, and it seemed that there was confusion there, like these projects were unfinished. That became an immediate concern to me. It made me feel very vulnerable. So, I put that on pause and didn’t use ICON products for a while.”
What a confusing time to get started with ICON! I wonder how many others are in the same boat?
And then, there is another issue: confusion between wallets and DeFi, and DApp interoperability.
“I eventually started using ICONFi, which I liked, and then Balanced, but I can’t access DApps with those,” Mitos said. “So I downloaded MyIconWallet, but I can’t log in to Winible or Craft Network with it — for those you need ICONex.”
“When I look at the Twitter threads, I still see people complaining, ‘Why do we have five wallets?’ It seems this is still problematic four months later. And now ICON is saying that they’re not supporting ICONex anymore. Yet we have new services coming out that only pair with ICONex. Why would you pair it with an unsupported wallet? Why can’t it be all Hana from now on?”
Does this sound familiar to you? Read on:
Unraveling the mystery behind ICON wallets and DeFi services
To get to the bottom of this, we interviewed Rhizome P-Rep member Fez, who also happens to be the Founder of Cryptosetups, a Youtube channel dedicated to providing in-depth tutorials for crypto beginners.
Web extension wallets
Since many DApps live in web-apps rather than mobile these days, a web extension wallet is the most surefire way to connect with the entire ecosystem of products and services.
“For maximum compatibility, you still need the ICONex Chrome browser web extension,” Fez says. “It’s just that nobody is actively working on building new functionality for ICONex anymore.”
“However, the Hana web extension wallet has just been released and will be optimized for all DApps moving forward. One of the reasons Hana hasn’t become the go-to defacto wallet yet is because certain DApps that have just recently launched still have to release components of functionality to enable Hana compatibility. But overall, ICONex is being phased out and Hana will be the default replacement.”
So, at the moment, yes, you need both wallets. But hopefully soon you’ll be able to delete ICONex and just use Hana going forward.
If you’re looking to migrate from ICONex to Hana, Fez has an excellent Cryptosetups video tutorial on just this topic. You can watch it right here:
Mobile wallets can still offer a lot of DApp support, and are a great way to go if you prefer a wallet that lives on your phone.
There is an old ICONex mobile app. However, it’s strictly a wallet that can’t interact with DApps or anything, and it’s not widely used anymore. For all intents and purposes, the ICONex mobile wallet was replaced by MyIconWallet in early 2021, which was built by Reliant Node, the same team that later went on to create Hana.
Non-custodial vs custodial wallets
ICONFi is a centralized platform custodial wallet. When you upload your ICX to ICONFi, your assets are actually on that platform — it’s like a bank. ICONFi is very easy to use and offers worry-free access to some similar services found on DeFi platforms such as compound interest and staking.
However, while you will have access to airdrips and airdrops on ICONFi, it can not currently give you access to other DApps.
“The only way you can interact with all the DApps is if you hold your keystore files or private keys,” Fez explains. “That is the core way at the moment to take part in Craft, Omm, Balanced — anything. That’s the biggest differentiation between custodial and non-custodial wallets.”
Hana, MyIconWallet and ICONex are non-custodial wallets. When you install these wallets on a computer or device, you have possession of your keys. If you accidentally delete a non-custodial wallet, you can easily use your private keys to set up a new wallet with all your funds intact. (Just remember to keep those private keys secret and safe!)
DeFi is not a wallet!
And then, there is DeFi.
Platforms like Balanced and Omm are great places to grow your ICX bags via more advanced strategies such as lending, borrowing and yield farming. However, these are custodial DeFi platforms, and should not be viewed as wallets. They also can not interact with other DApps, and generally require a non-custodial wallet to log in and on- and offload funds.
It’s a small distinction, but an important one to keep in mind. DeFi has an entirely different risk factor than a plain old wallet, so users should be wary about, say, HODLing their entire ICX bag on a single DeFi platform. Because, just like a bank, if a custodial platform suddenly goes belly-up, you’ll probably lose access to those funds too.
Keeping track of it all
“The best part about MetrICX is that it’s read-only. You don’t need private keys to install — you just put in your address. It then aggregates all the information associated with that wallet address — DApps, tokens, anything. It’ll tell you who you staked to, it’ll tell you which DApps you’ve got funds in and how much liquidity you’re providing, and it will tell you when you’ve earned rewards or claimed them,” Fez says.
Rhizome also has some great plans in store for MetrICX’s next version, 3.0, with a cool gamification component — read all about it in the great interview we had with Fez last month.
We can do better
The case may be made that the ICON Network has not made itself beginner-friendly just yet, although this pain point should hopefully lessen soon now that Omm and Balanced have launched and with ICE and ICON 2.0 coming up soon.
An important point to keep in mind is that ICON is no longer just the ICON Foundation. Since ICONCENSUS decentralized the network, ICON has growingly become more and more an amalgamation of the entire ICON community. Which means that we are all responsible for making sure ICON is approachable for newcomers, especially crypto beginners. We are responsible for building the services that make ICON great.
We are ICON, and we want you to be ICON too. And to this aim, this writer says, come on guys! Let’s build an ICON that everyone wants to be a part of! For that is the only way to truly hyperconnect the world.