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The Rise of the 3rd and 4th Wallet Form Factors
The Rise of the 3rd and 4th Wallet Form Factors
The Rise of the 3rd and 4th Wallet Form Factors


The realm of crypto wallets is a dynamic landscape, packed with hundreds of wallet startups and counting. 

Within this diverse ecosystem, a wide range of innovative tactics to manage your assets have emerged. While some take financial-first approaches, others lean toward social functionality, and a few prioritize security. Many others blend these together to some extent.

Regardless of strategy, a single thing holds true - these companies usually share one of two form factors:

  1. A mobile app
  2. A browser extension

The Problem

Major wallet providers (Coinbase Wallet, Rainbow, Metamask, Trust and many others) have all launched versions of the above two form factors. Smaller wallet startups usually start with one, while bigger companies typically tackle both at the same time. 

But while these two form factors sync and allow users to switch between them at their convenience, they also come with certain drawbacks. First off, they require you to install something, which creates friction for new users. Additionally, they have a small physical interface. This makes it difficult for users to conduct complex actions such as bridging, swapping and staking assets.

The above problems have ignited the rise of an exciting trend - the rise of the 3rd and 4th wallet form factors.

The 3rd Factor: A Streamlined User Onboarding Flow

When visiting a site or app, we’re typically presented with two familiar login methods: entering an email or phone number in a box, or opting for a login through Google or another social account. With the latter option, a pop-up window appears and prompts you to login to your account, verifies information sharing with the app, and then closes the window.

Wallets will adopt this precise form factor to replicate a comparable user login experience. In short, you select a wallet, get a social provider like popup, log in with your information (or see a logged in state when you have a session active), confirm access to the app and close the window.

In this form factor, returning users can quickly log into apps in a familiar way, removing the need to scan QR codes or install browser extensions. This factor is purely transactional, but adds simplicity and efficiency for users.

For new users, this provides a convenient way to seamlessly create a wallet without prior Web3 knowledge. You can use a passkey, email or social login within the pop up, and in turn receive a fully functioning, global, branded wallet. And while the first two form factors rely on a single device storage for user’s private keys, this third form factor leverages several devices to perform this action.

The 4th Factor: A Full Page Portfolio App

Mobile apps and browser extensions restrict users from executing complex actions on chain given their limited functionality and focus on a single wallet at a time. To solve for this, a 4th factor was introduced to tie it all together - a portfolio app. This portfolio app acts as a strong complement to the previous three form factors, extending their capabilities and enhancing the overall user experience.

Kicked off in part by Metamask’s success in building their own portfolio app, we are seeing more wallets add this to their offering. While users can still conduct day to day activities within the app or browser extension, more sophisticated management is also available through the portfolio app. This full page feature provides users with a detailed way to examine analytics, swap, view their NFT collection, and transact with all their accounts in one place. In short, the 4th form factor is the glue that sticks the first 3 form factors together.

We’re also seeing a trend where companies that were initially established as portfolio apps are expanding their services by launching wallet form factors. Zapper announced earlier this year that they are building a wallet. And Zerion recently introduced a browser extension and mobile wallet offering. And on the flip side, wallet providers are putting a greater focus on account management and DeFi interfaces for their users.

Our Prediction: Every Branded Wallet Will Have Four Form Factors

The world of wallets is constantly changing and will look a lot different in a few years. We expect that all wallet providers who want to excel will implement 4 form factors in the coming months and years. For instance, Rainbow initially emerged as a mobile wallet. They later integrated a browser extension and are now talking about mini-wallets as the next step of their product suite. 

In a few months, you will be able to access your wallet, whether Metamask, Coinbase, Rainbow, Zerion or others, in any way you choose - mobile app, browser extension, pop up in a dApp, or a full page portfolio app that ties the first three together. We’re excited for this next step, and are happy to play a pivotal role in the wallet sector.

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Itai Turbahn

Itai is the co-founder and CEO of Dynamic. Before Dynamic, Itai spent 7 years in product management leadership positions, and was previously a consultant at the Boston Consulting Group. Itai holds an MBA from Harvard Business School and B.Sc degrees in EECS and Economics from MIT.

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