MetaMask: How the Web3 wallet is making huge profits

MetaMask, the essential extension for cryptocurrency users, often sparks curiosity about how it generates revenue. How does MetaMask secure an ever-increasing stream of income?

MetaMask, the web extension that became a Web3 giant

Created by ConsenSys in 2016, MetaMask took some time to establish itself in the market. Until 2019, MetaMask was exclusively available as a browser extension, for Chrome and Firefox. At that time (not so long ago), making transfers between blockchains required a lengthy and risky process: user funds getting lost between platforms was common currency. While MetaMask has not completely solved all these issues (even becoming a prime target for hackers), it has significantly contributed to opening up blockchain to the general public.

The wallet really gained popularity from 2019 onwards, aided by the rise of the Binance Smart Chain and the phenomenon of airdrops. One year later, it made a significant breakthrough with crypto-enthusiasts by reaching one million users. Above all, MetaMask has responded effectively to the growing need to have a reliable tool for navigating the Web3 jungle. Today, the service can rely on an average of 20 million users each month. It now offers a swap service, a native DEX, as well as optimized mobile apps for iOS and Android since 2020. This has attracted more and more customers, making it one of the major levers for the public adoption of blockchain.

252 million dollars in profits

Historically, digital wallets are open source. By definition, this mode of operation does not offer the possibility to remunerate developers. Creating a wallet remains indeed 100% free. But MetaMask seems to have found the right formula. By offering an interface that is particularly simple and ergonomic, it has long-term facilitated holding and transferring of cryptocurrencies. Above all, its great strength lies in its ability to offer good liquidity on a wide range of cryptocurrencies.

Therefore, asking for a counterpart in exchange for this service seems acceptable to most crypto-enthusiasts. These transaction fees, amounting to 0.875%, assure its main source of revenue. While these “small” commissions have earned the American company a staggering 252 million dollars in 2022. Although the figures for 2023 are not yet known, the profits of the Consensys subsidiary are expected to increase mechanically. Especially if the price of bitcoin goes back up.

Lucrative partnerships

By democratizing the ownership of interoperable digital wallets, MetaMask provides a service to the entire crypto asset ecosystem. Coinbase, Binance, Kucoin, or Opensea: all benefit from the functionalities and ergonomics offered by the web extension.

MetaMask thus expands its influence by forging strategic partnerships with these cryptocurrency players. The collaborations are not limited to visibility issues but also generate financial returns through “mutually beneficial” arrangements. The details of these partnerships are difficult to access, even though one can easily imagine that they are quite profitable. In 2023, MetaMask even approached a historical leader in online payments: Paypal.

MetaMask Marketplace:

A lesser-known aspect, the MetaMask Marketplace, offers users additional features, including liquid staking. While optional, these transactions thus contribute to diversifying MetaMask’s sources of revenue. With this service, the web 3.0 extension aims to stand out by offering a complete range. Indeed, the influx of new clients from DeFi enables the wallet to increase its volumes, and therefore, its profits.

MetaMask maintains a pragmatic approach to guarantee its economic viability. Transaction fees, its strategic partnerships, and the Marketplace constitute an increasing stream of revenue. By becoming a must-have, ConsenSys has earned trust within the crypto community thanks to a wallet adapted to the complex world of cryptocurrency. However, competitors are on the lookout in a market that continues to grow, as is the case with TrustWallet or Ledger, which also offer their own digital wallet application.