How can your crypto wallet also be your password to Web3? - Crypto in Plain English - Episode 145 - by cryptohunt.it

How can your crypto wallet also be your password to Web3?

Welcome to the cryptohunt jam where we spend one minute a day to explain crypto. In plain english.

If you’ve ever come across one of those “Web 3” websites, you will have noticed that they don’t operate like normal websites: Instead of asking you to create an account with username or password, or log in through Google and Facebook, they simply connect to your wallet.

But what does that do? And is it safe?

Connecting with a crypto wallet really means nothing other than letting the website know that you own that particular address on the blockchain in that case. Think of it like buying a car on a financing plan: The dealer needs to know you actually have control over the money, they don’t really care about the sound of your name as long as you can pay. That’s why they do all these identity and credit checks.

With blockchains, it’s much easier: You are the owner of your account because only you have the key. All your history is right there for everyone you let in. Like the car dealer, those sites don’t really need to know your name or email address to allow you to use a service, for example to exchange one token for another. And because your blockchain account is tied to you and you only, it can serve a double purpose as your login.

Neat, isn’t it? But be careful - these web apps can ask for anything, including permissions to transfer things in and out of your wallet. Whatever they ask for, a dialog pops up. Always - and we mean this - always read very carefully what they are asking for. Confirming your identity is one thing, but there are plenty of scam websites out there: They will tell you it’s just a login, but hope you don’t read the dialog and just click “OK” when they are trying to clean out your wallet instead.

And there you have it: Logging in with a wallet - kind of convenient, but still a little scary, so be careful. Things will surely get better over time, but keep your guards up for now.

Disclaimer: This podcast references our opinion and is for information purposes only. It is not intended to be investment advice. Do your own research and seek a duly licensed professional for investment advice.