Wallet and Web3 Integration Developer Salary in 2024

Wallet and Web3 Integration

Crypto Wallet: What Is It & How Does It Work?

Crypto wallets are where you store the keys to your cryptocurrency and maintain them. You can send, receive, and spend cryptocurrency with a wide variety of them including but not limited to Bitcoin, Ethereum, Ripple, among many others. In a variety of forms and fashions, they can be physical devices, software on your computer or a service in the cloud, such as exodus, ledger, nano, among others.

But like cryptocurrency, the concept of a crypto wallet is, well, abstract. So let’s zoom in, on these indispensable tools of crypto, and see how they function.

What Is a Crypto Wallet?

The first thing to understand about crypto wallets is that they have nothing to do with the leather purse or back pocket billfold you use to carry cash and credit cards around with you. Something of an understatement: crooks and con artists are already starting to case supermarkets, expecting an influx of WEF-touting, crypto-laden yuppies These are electronic containers you use to safely store the ‘keys’ (or ‘access codes’, or ‘addresses’) to the digital tokens that are the keys to your crypto.

For cryptocurrency is the most abstract form of money: there is no token that is analogous to cash’s coins and bills; at root, it is simply a string of code on a larger ledger known as the blockchain.

So when you buy Bitcoin (BTC), what are you getting? You’re getting a string of 1s and 0s (a public key and a private key) on the BTC blockchain.

You could think of the public key as being analogous to your bank account number – anyone can know it, but it alone doesn’t give access to your money.

A private key is what would function as your password to your bank account. Don’t tell anyone the password or they’ll take all the money.

If you lose your private key, you lose your crypto. And the person who has access to your private key can sell out your crypto. That is why it is important to store your private keys in a crypto wallet.

Coins (or tokens) are entries of data in a blockchain system, and the corresponds to wallets – digital devices in a repository managed by the issuer designed to retrieve the assets.

How Do Crypto Wallets Work

A crypto wallet is what holds the public and private keys to send, receive and store cryptocurrency.

When you buy cryptocurrency, the company to which you purchased it issued you a ‘wallet’ containing the digital coins. That’s called a ‘hot wallet’ because it’s a hot environment, meaning it is connected to the internet.

‘If you don’t want there to be a chance for somebody to hack into your online wallet, you want to get a cold wallet where there is no connection to the internet,’ says Ric Edelman, the founder of Digital Assets Council of Financial Professionals.

Cold wallets are USB thumb drives or other hardware devices. ‘You buy one and you transfer your coins from your hot wallet to your cold wallet,’ says Edelman.

Types of Crypto Wallets

As mentioned above firstly there are hot and secondly cold wallet. Let’s try to understand these two types of crypto wallets in details.

Hot wallets are connected to the internet meanwhile dark wallets are not.

Paper Wallets

A paper wallet is the simplest cold wallet, and most straightforward to use. It’s literally what it says on the tin: a piece of paper with your keys on.

‘Since it’s only paper, it is a cold wallet and hence hackers will not be able to rob you, but you can easily misplace your paper, have it stolen, tear it up or get it ruined by getting wet,’ Edelman explains. ‘So, in retrospect, as cold wallets go, paper is pretty f*cked up.’

Hardware Wallets

A more secure cold wallet option is a hardware wallet, roughly equivalent to the USB drive, which safeguards your private keys from hackers, who would need to steal the hardware wallet to get your private key, Leinweber says.

Hardware wallets add another degree of security to paper wallets – you need to input a PIN each time before the contents of the device can be accessed. This prevents shoulder-surfers from stealing your private key but, Leinweber adds, forget the PIN, and you lose the coins. ‘So you need to be technically savvy to use such a wallet,’ Leinweber says.

The purpose of hardware wallets is to keep your private keys off the internet on your computer or smartphone, which can be hacked. ‘Storing the private keys offline eliminates that concern,’ Leinweber says. ‘You’d have to pickpocket a hardware wallet for a user’s private keys to end up in the wrong hands.’

A hardware wallet typically costs between INR 3,000 and INR 17,000, though there are clearly higher-end ones. A Trezor Model One, for instance, is about INR 10,000 now. A SafePal wallet, one of the cheaper ones, costs INR 5,500.

Online Wallets

Online wallets, as they are known, are your hot wallets. Operated as desktop, mobile or web-based software applications, they connect you to the blockchain and require an internet connection, which makes them far more convenient but also far more susceptible to hacking than cold wallets.

‘Your password is sitting out there on servers and could therefore be at enhanced risk.’

If you’re only trusting your infrastructure, he notes, then you bequeath the creation of desktop wallets such as Electrum and Wasabi Wallet. You might not need to trust third parties, remaining your own private island, entirely responsible for your wallet’s security.

‘The mobile wallet is really aimed for someone that wants to use cryptocurrency on a daily basis,’ Leinweber says. ‘And they kind of position it as an app on your phone, like Apple Wallet, and it really just enables that transaction through QR [in the case of bitcoin].

But alongside them, you have these web-based wallets, which are mostly found in browsers and you can transact anywhere you have internet,’ he adds.

Custodial Wallets vs. Non-Custodial Wallets

Here’s some more of that cool crypto lingo. A non-custodial wallet is the type that you are in command of your wallet data. This kind of crypto wallet is usually preferred by crypto users because it doesn’t require a third party to store your private keys.

With Exodus or MetaMask, you can use an offline wallet, another non-custodial option believed to be more secure – less prone to hacks.

These are different to custodial wallets, which are wallets provided by custodial crypto businesses, such as crypto exchanges, eg BlockFi Wallet.

If you adopt this kind of wallet, you are essentially delegating your private keys to them. So, if you have this type of wallet, the convenience comes at the associated privacy costs. When you want to access or move coins from this kind of wallet, you log in to your account and enter the destination where you want to send your coins. These types of ‘hot wallets’ often come with other features, including being free to set up, and having the ability to stake your crypto.

How To Get A Crypto Wallet

It is not difficult to have a cryptocurrency wallet in your hand. Some of the cryptocurrency exchanges, such as WazirX, Zebpay, Unocoin and C A cold wallet is also available from the manufacturer directly from the internet or even at Amazon.com. On Amazon, for instance, you will now notice that you buy the cold storage stick that is the Ledger Nano S almost INR 7,000 or the Trezor Model T hardware wallet for about INR 21,500.

But there are a few factors to consider when choosing a crypto wallet:

• Customer care: If you are new to owning crypto, a 24/7 support hotline from your wallet provider would also be a big plus.
• Fees: Third-party hot wallets may charge transaction fees, ultimately reducing your profits.
• Security: It’s crucial to use a wallet provider that is trustworthy and takes responsible measures to keep your cryptocurrency keys secure.
• Your type of crypto: do you want to store only one type of cryptos, or support up to 100 different crypto projects? For example, if I want to buy Cardano (ADA) then be sure that the wallet I intend to use supports that crypto.

Armed with these considerations, Leinweber says, there is no categorical ‘best’ crypto wallet (they each have both advantages and disadvantages), but there is a best crypto wallet for each person.

‘Many people are even using a whole series [of wallets] in parallel,’ he says, ‘which ultimately leads to a more sensible distribution of your possessions.’ Still, ‘which wallet is the best and appropriate for somebody is of course something that everyone must decide for themselves.’

How To Use Crypto Wallet

The exact process that you’ll use to send a cryptocurrency using your crypto wallet will depend on the specifics of the wallet, but it’ll usually be more or less similar to the process of sending any other kind of currency digitally.

‘You just type in the recipient’s public key – their address – and how much you want to spend. Then, if the network agrees it should go through, it’s done,’ says Leinweber.

The crucial distinction is that, if something goes wrong in cryptocurrency transactions, there is far less recourse.

‘You’ve really got to make sure you’ve typed the address in the right way,’ says Leinweber. ‘Because one of the characteristics of a cryptocurrency is that you can’t hand back a coin. If you accidentally type in the wrong address, you’re not going to get them back.’

What is Web3?

Web3 refers to datacentric technologies such as blockchain, which gives ownership and control of data on the internet to communities, rather than delivering top-down control through centralised bodies that dictate how the countless applications on the net save and use end-user data. In more conventional centralised management structures of the monolithic and non-decentralised internet (or Web1 and Web2), companies or other centralised structures call the shots on how their systems work. In contrast, in Web3 (or Web 3.0, decentralised web or semantic web) technologies, direct control ends up in the hands of the end users. They get to dictate prices, they can directly tech-develop a project, they get a bigger say in a project’s direction – but most importantly, these technologies have automatic ways of regulating the interactions of users. —No centralised entity needs to govern how people interact anymore.

What are the core ideas of Web 3.0?

Decentralization

These are decentralised web apps: Web 3.0 aims to spread and store the vast pool of data in decentralised networks. Different nodes or server-like entities own the distributed infrastructure and the user pays direct to the supplier of that access.

Decentralised applications ensure that information replicas are stored in multiple places, and that the data is consistent across these replicas. In a decentralised internet, each individual user can opt to keep their data on the infrastructure of their own choice. Decentralised internet users can choose to monetise their own data, if desired.

Trustlessness

With the centralised web application or service, there is an inherent need for users to place trust in the central nodes that hold the authority over a collection of data, transactions, and/or interactions. The central nodes have control over user data; they write and can change the rules, and they may use user data in ways that violate trust. Data may be stored insecurely or badly, and user information may be lost or misused.

Where Web2 is mediated by trusting a third party, Web3 is trustless: there’s no need to trust a third party for identity and interactions.

Semantic web

Semantic web (a.k.a. the read-write web) is a version of the World Wide Web that allows applications to do smart things based on the meaning of content on the web. Semantic web applications exploit metadata and artificial intelligence to give meanings (semantics) to your data, the data you create.

Web 3.0 is envisioned to take significant additional steps towards this goal by moving closer to modern implementations of semantic web technologies such as context-sensitive search engines that provide more accurate results, or intelligent agents to assist users with tasks.

Interoperability

Web 3.0 aims to extend more connections across the boundaries that currently exist between inventions, guaranteeing data flows between applications and services without intermediaries, according to a report from McKinsey. The dictionary defines the goal of interoperability as making data easily transferrable from one system to another. Portability, meanwhile has been defined as the ability to move data from one site with your associated information and settings intact.

At the same time, protocols that incorporate a vast array of Internet of Things (IoT) artefacts continue to push the technological outlines of the web ‘beyond its borders’. By facilitating borderless transactions, cryptocurrency technologies open up avenues for the exchange of value across geographical and political boundaries.

Why is Web 3.0 important?

Early experiences of the read-only web illustrate this point. Back when the internet was founded, we were limited to read-only experiences. Static webpages, hosted with infrastructure leased and maintained by a few companies, were the only content that end users were exposed to.

As enabled by infra-structure for the new Web 2.0 technologies, such as blogs, social media and other information services, such applications get users to recreate content and trade services with each other, but, in principle, all those interactions come under the control of a central third-party authority, which makes money commercially out of the very service exchange, and often owns and controls the assets that end users create in digital forms.

For instance, sites such as Upwork (previously known as Elance-oDesk) act as intermediaries between freelancers and customers, while room-share platforms connect the owners to the renters. Service-providers and service-users alike create different types of data, such as service profiles, service descriptions, user profiles, blogs, videos and comments. All the data is collected and stored centrally.

Challenges with Web 2.0

Although the middle platforms mediate and moderate the interaction between the two parties, Web 2.0 devices create obstacles:

• Provider lock-in makes it impossible for service providers to move their data resources to other platforms without losing their trust and plenty of customers.
• Service users have limited control over how their data is used and managed.

There are few restrictions as to what these types of organisations can do, because the agora is now a sovereign platform that has no obligation to any individual end users. For instance, it might censor some of the user-generated content, or remove some site features from end-user access.

Benefits of Web 3.0

• Improved engagement
• Enhanced privacy
• Democratized communication

What are the main technologies in Web 3.0?

Blockchain is a technology that supports many Web 3.0 applications. Blockchains are essentially distributed public ledgers of transactions or data maintained across a network of nodes that are distributed, immutable and ‘trustless’.

Any peer-to-peer network for a blockchain database allows you to directly connect and share data with multiple unknown parties in a network, without the need for an intermediary like a broker. Data is stored sequentially, usually in blocks, but you can tamper with it only with a peer-to-peer network’s consent – it applies cryptographic hashes and timestamps in a sequential fashion, so changes in the data are impossible without the consent of the next member in the flow of information. The hard part is getting accounting data onto the shared ledger without tampering – in practice, it requires entering a transaction into a block and manipulating the hashes so that it looks legitimate. There is no way to edit data without permission It’s precisely these built-in mechanisms that prevent rewriting history on the ledger, and that create a ‘shared truth’ for transactions, making it a perfect way to create an incorruptible or immutable record of any transaction, tamper-proof under circumstances where trusted third parties can’t act as transaction recorders.

Other key technologies driving the development of Web 3.0 are given next.

Tokenization

One way to expand blockchain applications is to tokenise: a process that takes a real-world or digitally created object and gives it a digital token on a blockchain .

These tokens are simply computer code that acts as a cryptographic representation of ownership, access rights or value – equivalent to representing real-world and virtual ‘goods’ such as any kind of real estate, stocks, commodities, art, music, in-game items, and much more.

Each token represents some fraction (or whole-number unit, if you prefer) of an underlying asset that can be subdivided and traded freely. There are a couple of token types floating around the virtual world, security tokens that would come with securities regulations or non-fungible tokens (NFTs) that represent unique, indivisible assets that you can’t fractionally own.

WebAssembly

WebAssembly (Wasm) is a compact binary instruction format for a virtual stack machine, which runs in a sandboxed manner inside the browser – it is unable to access the user’s local filesystem.

It allows for high-performance code to run in the browser, on which the decentralised apps operate, and run efficiently on native platforms. It allows developers to run code at near-native speed – significantly faster than JavaScript or other traditional web technologies.

Semantic web technologies

Semantic web applications take it to the next level when reading from a set of linked data principles. Look at applications that perform linked data, where a bunch of data instances are interlinked, or even published in a structured way on the web through RDFa, MicroData or other emerging web development approaches. Here are a few examples.

• Resource Description Framework
• Web Ontology Language

What are some example Web 3.0 applications?

Several of these applications are built using blockchain technology through APIs and services, and in turn we layer these applications on top of one another to form additional Web3 applications for use cases. We will provide some examples next.

Smart contracts

Smart contracts are a type of self-executing agreement that contains agreement rules embedded within a piece of code. They automatically enforce the agreement’s terms once certain conditions are fulfilled. For example, let’s say that a contract states that ‘whoever pays for an item gets to own it’. In that case, you would just transfer the asking price to the contract and the transition from payment to ownership occurs automatically, thanks to the ledger. By using a transaction in the next block, it would then be changed to reflect you as the new owner.

A decentralised autonomous organisation (DAO) is a smart contract, agreed on by everyone, which automates decentralised collective decision-making over a pool of resources (tokens). The users of the tokens can vote on how tokens are spent, and the code performs whatever the outcome of the vote is.

Perhaps you can program terms for payment across a supply chain or financial instruments, such as mortgages, bonds or securities. Smart contracts can substitute for intermediaries, and their use eliminates the need for a middleman. That, in turn, makes transactions cheaper and more secure.

Decentralized identification

Decentralised identity is meant to put more control and ownership into users’ hands. On the web today, you might be logging into Facebook, or using your email address with some other central identity provider to access websites, applications and digital services.

With decentralised identity, the control of identity information is shifted back to the domain of the individual user – through the use of globally unique identifiers that are associated with a DID document (a decentralised identifier document with attached public keys, cryptographic material and service endpoints). We’ve integrated selective disclosure of attributes in the overall structure: when registries (issuers) and service providers request identity verification, they can be directed to access only specific attributes instead of requesting all your PII.

InterPlanetary File System (IPFS)

IPFS is a peer-to-peer (P2P), content-addressed, block-structured storage protocol that enables the creation of a completely decentralised and distributed dataset for Web 3.0. Every file is assigned a unique cryptographic hash (referred to as a content-based end-point address). IPFS itself uses a P2P network architecture where each IPFS node is a P2P packet client and server. Each node helps store, retrieve and distribute the content on the web and users can collaborate with each other.

For example, if you’re a user who wants to access content hosted on IPFS, you fire a request to a peer that contains the hash of the content you’re interested in retrieving; the peer then contacts every other peer that’s storing that content’s hash/hash table entry so that you can retrieve content from many nodes in parallel, which will not only be redundant but also fault tolerant and secure.

What are some Web 3.0 implementation challenges?

As with all emerging technologies, there is an initial set of challenges that need to be overcome before viable applications can be implemented on Web 3.0. These key problems are enlisted below.

Technical challenges

This remains a potential limit: as blockchain networks grow, the cost and processing power required skyrockets. There are academic groups working to find a sustainable green technology and a consensus mechanism to make it scalable.

Interoperability between different blockchain networks and protocols is another challenge.

User experience and adoption

Ultimately, mainstream adoption is hindered by both complex interfaces and a steep learning curve. The user experience needs to be dramatically improved by developing an intuitive user experience that abstracts the intricacies of the blockchain protocol.

But more than that – they can also be a hindrance to regulatory compliance, because Web3 applications need to be built within the constraints of existing data protection and financial security rules.

Governance

Increasingly, governance in decentralised systems is challenging. As networks get larger, effective structures that involve community members have to be developed and scaled, without decentralising the power.

However, it is a process of designing efficient tokenomics and token standards that provide users with the right incentives and eliminate ‘bad’ behaviour, embedded within the application’s goals. This will not be the last, nor the first, challenge of collaboration, innovation and iteration within the Web3 community to solve such limitations.

Integration In Action: Building Web3 Applications

Here are some of the key areas where blockchain technology is being woven into web applications today to help usher in the future known as Web3:

Decentralised applications (dApps)

Software that runs on blockchains rather than on existing web applications. DApps run on a blockchain without involving a central server, and their logic is executed using pre-programmed smart contracts – self-executing computer programmes that automatically govern interactions and transactions on the chain.

That cuts out the middlemen, saves some money and adds some transparency. A dApp could streamline a peer-to-peer financial transaction without requiring a bank, for example.

Digital Identity and Ownership

Properties can also be created with an identity attached to it, ensuring the ability to link real-world identities with decentralised web services. This specific integration offers the possibility of self-sovereign identities, where users retain control over their own data and can selectively share that data with the applications they are looking to utilise. Web3 applications can also leverage blockchain-based identity (ID) solutions to allow for a streamlined user onboarding and verification experience.

Besides that, blockchain allows you to create trusted, provable ownership records for digital objects. This ultimately powers ‘non-fungible tokens’, or NFTs, which can be used to represent digital items like artworks or collectibles, and can be embedded in Web3 applications, so users can buy, sell and manage these digital objects.

Data Privacy and Security

There have been increasing instances of data being stored on centralised repositories suffering huge breaches. Those in the Centralised Web can capitalise on blockchain to store data in a secure manner. Using blockchain to store data will distribute it across many servers to prevent any vulnerable entry point to hackers. Web3 applications can use blockchain to store their users’ data securely, giving the users the ability to control their privacy to the privacy settings of their choosing.

Content Monetisation

In today’s Web 2.0 environment, account-based networks often do not provide a fair share of revenues from content creation back to its original creators. Blockchain Integration can serve as a means to create content monetisation models with reliable and unambiguous cryptoeconomics. Web3 applications can be integrated with micropayments solutions, based on blockchain technology, to make existing value chains more transparent and functional – thus enabling users to directly remunerate content creators without intermediaries.

Supporting Web3 Infrastructure

Together, blockchain and Web3 technologies enable companies to create more efficient, secure and transparent apps. Indirectly, it is the intersection between the two that gives birth to a new digital economy grounded on a peer-to-peer doling out and trading of assets stored in the blockchain.

Blockchain Integration
Combining with cryptocurrencies, blockchain integration plays an indispensable role in constructing Web3 by fostering the possibilities of taking Web2 services from centralised enterprises to independent organisations. Nevertheless, there are other technologies that help dApps to analyse data in Web3 likewise as how humans do it; these are:

Since dApps are developed on top of decentralised technology services such as blockchain Integration, users will be able to interact with decentralised systems in the same way as they would with conventional web apps, while developers will be able to use dApps to replicate the functionality of practically any app, such as for the management of supply chains, financial apps, or social networks.

Blockchain is also changing the way in which transactions take place on the web after all, users employing the technology are able to complete online transactions without assistance from third-party services that transact for them, such as the bank, Visa, Amazon, Google and so on.

Also, Web3 and blockchain Integration boosts transparency and openness; Web3 users will use cryptographic keys to access content, accords, resources and apps.

How Blockchain Integration And Crypto Fit Into Web3 Technology

Web3 technology presents an open, accessible and borderless future for the internet because of Web3 integration in blockchain. This is because blockchain and cryptocurrencies can help achieve this vision, and here is how:

• Permissionless Access: Web3’s embedded programming in the blockchain replaces the closed systems of interest found in legacy organisations with decentralised open-source code. That means anyone in the world can access and interact with Web3 applications in a permissionless way, rather than with permission from entities such as banks. You can join online communities’ social-media platforms, provide liquidity in their dApps or DeFi networks, or even create competing initiatives which play by the same rules.
• Decentralisation and transparency: Web2’s biggest limitation is the consolidation of power, and data, in a few large corporate entities. We3 integration into blockchain;We3 integrates into blockchain Web3 tackles this problem with decentralisation. Through distributed public ledgers powered by blockchain, information and control are more disbursed.
• Digital Payments Infrastructure: Web3’s traditional payment infrastructure can often be slow and costly, burdened with layers of intermediaries and subject to jurisdictional issues. One of the great promises of integrating Web3 with blockchain comes from the concept of cryptocurrencies, a form of digital currency that can be effectively borderless, not requiring financial institutions or intermediaries for its use.
• Trustless: transactions and ownership on a blockchainIntegration creates trust in an environment where no intermediaries are needed – users are no longer dependent on banks or third parties. Owners of a cryptocurrency control their digital assets by holding them in a self custody crypto wallet.

Furthermore, such wallets interface with decentralised applications (dApps) for multiple purposes. The integration with blockchain means that Web3 is so open that anyone can audit ownership to an account by pointing to the public ledger – essentially proving ownership. The very notion that one has total control over digital goods as well as being able to view or audit them is a foundation of Web3.

Benefits Of Blockchain Integration In Web3

This is where the power of the one-two punch between Web3 and blockchain integration comes in. Blockchain companies that are integrating Web3 and launching Web3 businesses and companies will benefit from a wide range of features and functionalities that can completely change the way businesses run and interact with their users.

• More Trustworthy and Secure: The benefit of web3 on blockchain is that it leads to more trustworthy and secure online environments. The fact that there’s no middleman and an entirely decentralised system is the first way in which it is more difficult to reach a cyberattack or incur fraud. The second way is that all purchases are on this blockchain ledger that is an audit trail of proof and it creates trust between merchants and clients.
• Quickly respond to transactions and save money: Blockchain’s integration with Web3increase the speed of processing transactions.Most common means of payingwith many costly banking. Too many means means many difficulties and highest costs for same amount.
• Improved efficiency and transparency: Web3 integrations with blockchain is the perfect tracker for the goods and assets, which is made possible due to the transparency and trace-ability of the blockchain for all parties involved. Companies are provided with the means to track resources from point A to point B.

More importantly, the increased visibility should lead to increased stakeholder confidence, and help the firm with regulatory compliance. Being automated, some of the routine tasks possible through the use of blockchain can lead to the efficiency and lower opex (operating expenditure) we discussed earlier. Smart contracts – self-executing code that can be deployed on a blockchain to automate a process – can be designed to settle payments, enter into real estate contracts, offer financial services, or perform various action items, amongst the many other use cases. The fewer workers will be tied up to these mundane tasks and will have the time to focus on strategic activities of the enterprise within the new Web3.

Second, enterprises can jump on the bandwagon of Web3, integrating blockchain with Web2. Enterprises have little option but to embrace Web3 and blockchain when combining these technologies. The resulting progress will bring more security and convenience in business operations along with higher transparency and efficiency.