MetaMask has made it possible to buy cryptocurrencies directly from a bank account by logging in with the wallet.
This was made possible through a close collaboration between Consensys, Joseph Lubin‘s US-based company that owns the MetaMask wallet, and fintech company Sardine.
After raising more than $50 million in funding, the company then decided to make it possible for users to link MetaMask logins to bank accounts, though for now only in the United States.
Of course, there are purchase limits, namely $3,000 per day, $5,000 per week and $25,000 per month.
The demand from users is definitely there for this kind of functionality and ease of buying cryptocurrencies.
Obviously, this facilitates exchanges without making too many steps between different platforms, so usability definitely improves, but at what price?
MetaMask and the loss of decentralization with bank login
Those who decide to enable MetaMask login through their bank account would obviously link their KYC performed at the time of opening the bank account with MetaMask.
First of all, this is a privacy issue: if cryptocurrencies offer the possibility of being able to protect one’s privacy, with this connection between platforms this would be lost.
In addition, after several cases of hacker attacks directed at centralized platforms, surely privacy could also be lost if data were leaked, perhaps even resold on the market.
Another important point is that banks could have access to your different addresses. With MiCA in Europe, centralized platforms are already required to disclose users’ wallet data, there is nothing to prevent non-custodial wallets such as MetaMask from being involved in the future. While it is true that the company does not store private key data, it could still make it easier for banks to keep track of transactions since the blockchain is public.
Certainly, this type of functionality could make it easier to access cryptocurrencies, but there are also many downsides that one needs to be aware of in order to make an informed decision to log into MetaMask via bank account.
How does Sardine’s platform work
The fintech company founded a platform that facilitates the exchange between fiat currencies and cryptocurrencies by making transactions immediate. It has already been collaborating with FTX, MoonPay, Blockchain.com, and Autograph for some time. In addition, Sardine has a fraud-checking tool at its core to make sure that the money that is exchanged and the wallets involved have not been previously involved in scams or frauds.
ConsenSys, in a blog post announcing the partnership, explained:
“The company is a leader in real-time fraud detection and allows users to move money faster and safer through its ACH-to-crypto solution. Instead of waiting for the money to hit your account in order to use it, Sardine sends you the money instantly, so you don’t have to expect any delays.”
The latest news on MetaMask
In recent days there has been news that a sidechain compatible with the Ethereum Virtual Machine (EVM) has been created on Ripple. This may soon make XRP, which is the cryptocurrency running on Ripple’s blockchain (or rather ledger) compatible with wallets such as MetaMask.