What is a multi-chain crypto wallet?

A multi-chain crypto wallet allows you to store assets on—and interact with—multiple blockchain networks (as opposed to just a single network). Multi-chain wallets typically have an interface for controlling which blockchain you’re connected to, making it easy for users to switch between networks as needed. This makes multi-chain crypto wallets a major driver of “interoperability”—the movement to increase compatibility between the otherwise independent blockchains that make up Web3.

As Web3 adoption increases, and as more and more blockchains emerge, multi-chain capability is becoming a must-have feature of many crypto wallets. In this article: an intro to multi-chain crypto wallets, how they work, their advantages (and things to watch out for), and the different options you can try for yourself.

What is interoperability and why is it important?

In the context of Web3, interoperability refers to the ability to readily exchange data between different blockchain networks. Blockchains contain a shared ledger, and the required internal logic for a community of peers to reach consensus about the state of that ledger. By design, blockchains facilitate internal communication (i.e. within the blockchain network), but not external (i.e. outside that particular network). In other words, extra work is needed for distinct blockchains to be able to communicate and work together.

The current state of Web3 is not unlike the early days of the Web—where different technical specifications competed before agreed-upon Web standards (i.e. standardized best practices) were established. That’s why many people are currently building new solutions that enhance the compatibility and interoperability of different blockchains to support the growth of Web3. But that’s also led to some makeshift standards in the process.

Why is communication between blockchains difficult?

When a blockchain is created, rules must be established that govern how the network will operate. These rules are the basis for cooperation between the community of peers that make up the network. These rules—often collectively referred to as a “consensus mechanism”—must dictate how to:

  • Send messages between nodes
  • Determine which transactions/blocks are valid
  • Prevent and settle disputes
  • Update the network to address a bug or new feature

The result is that each blockchain ends up with its own set of rules (and their various technical implications) that don’t often mesh with the rules of another network—at least not without some extra configuration.

The growing need for interoperability

In the earlier days of Web3, certain blockchains excelled at certain things, and users would pick and choose between them as needed. You’d use a Bitcoin wallet to store bitcoin on the Bitcoin network and do Bitcoin things; an Ethereum wallet to store ether on the Ethereum network and do Ethereum things; and so on. The lack of interoperability wasn’t seen as much of an issue. But now, as Web3 continues to evolve and become more interconnected, the lines have blurred between the different networks and their use cases.

People often find themselves using different blockchains for different purposes—some unique and others overlapping. It’s no longer the case that, for example, Ethereum is the exclusive home of NFTs; dozens of blockchains have their own thriving NFT ecosystems. From affordable transactions, to thriving gaming ecosystems, to robust DeFi platforms, there’s a lot of cool stuff being built on many different blockchains.

This pace and breadth of development is exciting, but it also reveals a problem: the lack of compatibility between different blockchains makes their respective ecosystems fairly siloed. It hasn’t always been easy to do things like transfer assets from one blockchain to another, or for a developer to build a DApp and launch it on several networks.

But with advances in interoperability, these things (and many others) are becoming much easier. Perhaps the biggest interoperability innovation is multi-chain crypto wallets, which make it possible to store/manage assets on multiple different blockchains using one wallet. And, relatedly, to connect to DApps on different blockchains from one convenient interface.

How multi-chain crypto wallets work

Multi-chain crypto wallets are designed to support many different blockchains. That means they’re programmed to know the rules (or consensus mechanism) of each different network they support. This enables multi-chain wallets to communicate with nodes on multiple different networks, enabling users to send/receive assets, and interact with DApps on any blockchain the wallet supports.

Which blockchain networks are usually compatible with multi-chain wallets?

Every multi-chain crypto wallet will have its own offering of supported networks (some of which might include Bitcoin, Ethereum, Solana, Polygon, or others). In general, the most popular blockchains (measured by the number of users or transaction volume) warrant the development work necessary to add support for them in multi-chain wallets.

Standardizing blockchain development

It’s also possible for blockchains to potentially gain more adoption and wallet integration by adhering to development standards set forth by other popular blockchains.

The Ethereum Virtual Machine (or EVM), for example, is the engine that powers Ethereum. It’s the software environment that manages all operations and transactions, and makes it possible for Ethereum to host smart contracts and DApps. Later blockchains have made it a point to be “EVM-compatible,” meaning they’re able to run the EVM and execute Ethereum smart contracts.

Blockchains that are EVM-compatible can host DApps designed for Ethereum without developers having to change the code or start from scratch. And EVM-compatible blockchains that can process Ethereum transactions are easier to add to a multi-chain wallet that already supports Ethereum. This is just one example of how interoperability standards are emerging in Web3.

What are the main advantages of using a multi-chain crypto wallet?

Similar to how your current Web browser can help you navigate to basically any Web 2.0 site, multi-chain crypto wallets enable users to connect to more blockchains and do more on Web3 without needing extra software. Some of the main advantages of using a multi-chain crypto wallet include:

  • Diversified asset management: store more kinds of assets, and enjoy better portfolio tracking and analytics
  • Enhanced accessibility and compatibility: explore more ecosystems, DApps, and more with one piece of software
  • Built-in exchange features: swap between assets, and transfer assets across different blockchains
  • Reduced transaction costs: enjoy more opportunities to choose and use cost-efficient networks in one place

Are multi-chain wallets safe?

Using a multi-chain wallet is much like using a single-chain crypto wallet, so you’ll want to follow the same best practices for Web3 security. The only notable difference is that you’ll need to pay close attention to which network you’re connected to in your multi-chain wallet. If you switch from using a single-chain crypto wallet to a multi-chain wallet, you should get accustomed to double checking you’re using the intended network before transacting.

Embrace the multi-chain future with Brave Wallet

If you’re looking for a secure, multi-chain crypto wallet that’s built right into your browser, check out Brave Wallet. It supports multiple networks like Bitcoin, Ethereum, EVM-compatible chains, Solana, and Filecoin—and it shows all your assets on these networks (including NFTs) in one clean, multi-chain portfolio view. You can manage all kinds of assets (and swap between them) directly in Brave Wallet—from one convenient place within a fast, secure browser. Download Brave and click Wallet icon to get started today.

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