Blockchain Series — How MetaMask Creates Accounts (2024)

FAQs

How does MetaMask generate wallets? ›

MetaMask uses BIP39 to generate a seed phrase for your wallet. Your seed phrase will cover every token, address, and transaction generated by your wallet. Think of it as your backup master key. You can think of your seed phrase as a master backup of all your cryptocurrency in this wallet.

There are two ways to link your MetaMask wallet to another blockchain: Using a third party like Chainlist to link the new chain to your wallet automatically. Manually inputting the data to link the desired chain to your wallet.

MetaMask will attempt to add your additional accounts where possible (assuming they were not imported) by checking your previous accounts in ascending order (i.e. Account 2, then Account 3, etc.). Accounts are added if they have a non-zero ETH balance.

MetaMask supports tokens and NFTs on the main Ethereum blockchain and BNB blockchain (formerly Binance Smart Chain).

Here comes the interesting part. How does MetaMask create additional accounts (after the first default account)? Turns out that MetaMask makes use of the private key of the first account and use it to generate a set of child keys, which are then used to generate their respective public keys, and so on.

When you create your MetaMask wallet, you will be given a Secret Recovery Phrase, and an account is automatically generated. You'll see that as your Account 1 (default account). If you'd like to create and manage multiple MetaMask accounts, you could do so simply by creating more accounts.

Conversation. All MetaMask accounts are generated from your same seed phrase, and encrypted with your same password, so if you have it backed up, you will be able to restore all the accounts you create later on. You can create any number of accounts, and switch between them freely.

How do I transfer my existing ETH and tokens to MetaMask? You can send ETH and tokens from another wallet to a new MetaMask account. Simply copy your new MetaMask public address and go to your existing wallet or exchange to send funds to your new wallet address.

on https://app.1inch.io/ choose 'connect wallet', accept the Terms of Service and select the first connection option - 'MetaMask'. You can now use the MetaMask internal browser for interaction with 1inch. To connect the Metamask app on your mobile phone to a browser on your desktop, use the 'WalletConnect' option.

The first thing to understand is that, within MetaMask, each 'wallet' is actually called an 'Account'. But each account acts as a separate wallet and, most importantly, has a separate address.

Is each MetaMask account a different wallet? ›

Yes, you can have two or more Metamask crypto wallets. Within the wallet, you can create multiple addresses that function as a wallet. Each one can be imported to multiple devices as well. So you can use the same address on more than one device.

One of the benefits of using MetaMask is that you can use your 12-word Secret Recovery Phrase on multiple computer to access your ETH addresses and tokens.

MetaMask funds are stored in hot wallets: In order to make it as easy as possible for users to access, trade, and use their crypto, MetaMask stores all of its users' assets in hot wallets, i.e. digital crypto wallets that are perpetually connected to the blockchain.

You can't get back in. There's nothing you can do. With Ethereum and other blockchains, that's not the case. As long as no one else controls your seed phrase you can always just access Ethereum (and all your digital assets) using a different piece of wallet software.

A blockchain software business focused on Ethereum-based infrastructure and tools, ConsenSys Software Inc. is the owner of MetaMask. ConsenSys developed MetaMask in 2016. Before 2019, MetaMask was only accessible as a desktop browser extension for Firefox and Google Chrome.

Please note that anyone who knows your public key can view the activity in your account. This is one reason why you may want to create multiple accounts in your MetaMask wallet. One account, whose public key you will share with others and another account, whose public key you will never share with anyone.

Metamask accounts are not compromised by giving permission to a website. The permission only allows the website to see your public address, not your private key or seed phrase.

While a Secret Recovery Phrase is used to create and restore your entire MetaMask Wallet, including all accounts created in that wallet, each account has its own private key.

Known for its fox logo and colorful interface, MetaMask is a free online wallet that allows users to store and manage account keys, broadcast transactions, send and receive Ethereum-based cryptocurrencies and tokens, and securely connect to decentralized applications through a compatible web browser or the mobile app's ...

Metamask does not have to send any information to the IRS because Metamask is an ETH wallet, and the IRS cannot keep track of Metamask.

Can MetaMask be hacked by connecting? ›

It's always important to ensure that the site you have linked your MetaMask extension to is reputable, as accounts can be compromised through phishing if users enter their seed phrase into fake websites. If you connect to scam sites and approve the wrong privileges, they can drain your crypto wallet.

If the user can get access to your password, your wallet is now available to the scammer and is likely to be drained. Even if the scammer does not use a keylogger to get your password, it is possible for a scammer to get access to the encrypted file where your seed phrase and private key is stored.

On Metamask, you can set your gas fee to “Low” before confirming a transaction. If you want to save even more gas, click on Advanced Options.

Final Verdict

For example, Coinbase allows its users to run dApps via a web-based platform, while MetaMask offers hardware wallet integrations. Even though Coinbase has integrated with multiple blockchains, it cannot compete with MetaMask's ability to connect with every dApp on the Ethereum blockchain.

MetaMask users will now be able to fund their crypto wallets via bank transfers instantly, instead of having to wait for traditional fund transfers to clear. In a blog post, ConsenSys argued that instant ACH transfers through Sardine are better than other methods for some users.

If you are on Metamask, undoubtedly, you should know that your IP address gets logged with every transaction you make, making it possible to identify who you are and your location.

Yes, you can import the same MetaMask wallet on different devices. Each wallet instance is device specific, so you will have a unique password for each device and must add any RPC networks or custom tokens you have to each device.

The first time you're accessing it you will be asked to Create wallet or import account. You need to select “Create wallet”. Then a new seed phrase will be created, so make sure you store it safely.

Using different browsers

This option is as straightforward as it sounds: if you've only got two or three SRPs, then you can simply install MetaMask in several different browsers, and use a different browser for each one.

Click on the account button. Go to 'Settings'. Select 'Security & Privacy'. Scroll down and then click on 'Show private key'.

Does MetaMask track your location? ›

In particular, services like MetaMask or Etherscan can read your IP address, which means linking your IP address to your wallet address. And IP addresses reveal location data.

What is MetaMask? Public blockchains like Ethereum are the next evolution of Internet databases, and MetaMask is the next evolution of the browser. MetaMask is a web browser extension and mobile app that allows you to manage your Ethereum private keys.

Metamask is a safe crypto storage option that stores and encrypts private keys on users' devices. Metamask allows crypto swapping within the application and offers access to the world of dApps, DeFi, and NFTs.

Being an online wallet, your browser will collect information about how and when you use MetaMask. This can be a potential privacy concern for cryptocurrency users. MetaMask also holds private keys in your browser. While this makes the app easier to use, it presents serious risks if your browser is hacked.

MetaMask will never hand over your wallet to a government entity nor will it ever freeze your wallet like Robinhood did this past spring by restricting users' GameStop equity.

If you've been a victim of these malicious attacks, there may be a way to recover your funds. MetaMask has partnered with Asset Reality to enhance customer support by providing direct access to a third-party who can investigate, track, trace, and potentially attempt to recover funds.

In a statement to CoinDesk, MetaMask's parent company, ConsenSys said that it observes US. sanctions on “Iran, North Korea, Cuba, Syria, and the Crimea, Donetsk, and Luhansk regions of Ukraine.”

New York, NY, August 31st, 2021 — ConsenSys announced today that MetaMask now has more than 10 million monthly active users. This represents a 19x growth compared to July 2020, and positions MetaMask as the leading non-custodial wallet by users globally.

MetaMask's approach to security is based on user anonymity rather than standard security measures in many aspects. MetaMask does not store any user data because the software is non-custodial. The platform does not manage private keys.

In simple terms, a series of words are selected with a high level of randomness from a specific list of words. In MetaMask and many other Ethereum-compatible technologies, there are 12 words in a seed phrase. Some older seeds generated by the Brave browser, and some hardware wallets, use 24-word phrases.

How does MetaMask generate revenue? ›

MetaMask makes money from swap fees, management fees, as well as by selling merchandise via its online store. Launched in 2016, MetaMask has risen to become the world's leading Ethereum wallet. It is used by more than 21 million people across the world.

The MetaMask browser extension is a browser extension that can act as your Ethereum wallet. Unlike traditional wallets, MetaMask requires no additional plug-ins, so you're free to use it in any browser. Once installed, you can view your Ethereum address and send or receive coins to any Ethereum address in turn.

Step 1: Log into your MetaMask account. Step 2: On your Main Ethereum Network page, click the Details button. Step 3: Click the Export Private Key button. Step 4: Enter your MetaMask password and then click Confirm.

Conversation. All MetaMask accounts are generated from your same seed phrase, and encrypted with your same password, so if you have it backed up, you will be able to restore all the accounts you create later on. You can create any number of accounts, and switch between them freely.

This means even if access to your wallet is somehow interrupted, the data representing your funds are still securely recorded on the digital ledger of the blockchain. Seed phrases are generated whenever a new crypto wallet is created, whether it's a hardware wallet, a software wallet or a web wallet.

MetaMask funds are stored in hot wallets: In order to make it as easy as possible for users to access, trade, and use their crypto, MetaMask stores all of its users' assets in hot wallets, i.e. digital crypto wallets that are perpetually connected to the blockchain.

Metamask does not have to send any information to the IRS because Metamask is an ETH wallet, and the IRS cannot keep track of Metamask.

Just like these other forms of property, cryptocurrencies are subject to capital gains and losses rules, and you need to report your gains, losses, and income generated from your crypto investments on your taxes.

Does MetaMask provide a tax report? No, MetaMask doesn't provide a tax report. But you can use your MetaMask transaction history to calculate your crypto taxes and create a crypto tax report.

As a decentralized wallet, MetaMask has no central authority to which you can appeal for help. It is a non-custodial wallet: you own your funds as long as you have access to them with your Secret Recovery Phrase.

Does MetaMask own your keys? ›

The difference between a custodial wallet like Coinbase and a self-custodial wallet like MetaMask is that custodial wallets have access to and take care of your private key, while with self-custodial wallets, you're responsible for them yourself.

Mnemonic codes are the most commonly used technique to generate and recover a private key in the blockchain wallet. The mnemonic code technique used in blockchain uses the word list in BIP-0039. A private key is generated by combining 12 to 24 words out of 2048 words of the BIP-0039 list as a seed.

MetaMask stores the Secret Recovery Phrase, passwords, and private keys in an encrypted format locally on the device where it's installed.