The popularity of decentralized finance played an integral role in the launch of MetaMask Institutional, as companies looked to enter the space safely.
MetaMask is probably one of the most famous stand-alone Ethereum software wallets in the cryptocurrency ecosystem, with its unique Orange Fox avatar plugin, which acts as a portal to the world of Ether.
token-based, decentralized applications (DApps) and decentralized finance (DeFi).
The retail browser addon wallet surpassed 30 million users worldwide in 2022 and gradually turned its attention to serving a growing number of institutional users looking to gain exposure and manage assets in the growing DeFi space.
Cointelegraph caught up with Elizabeth Mathew, head of growth and partnerships at MetaMask Institutional (MMI), at the company’s booth during Token2049 in Singapore. The background of a blue fox was a noticeable change, with the color scheme contrasting with the familiar orange of the MetaMask logo that most users are used to.
MetaMask Head of Partnerships and Institutional Growth Elizabeth Mathew chats with Cointelegraph at Token2049 in Singapore.
MetaMask Institutional (MMI) has been around since October 2021 at a time when institutions began allocating significant amounts of capital to DeFi markets through the mainstream MetaMask retail wallet.
The service was born from the need to meet specific requests from institutional users. Access was a primary consideration in providing a broader range of operational controls over a wallet. This includes appropriate segmentations of roles and responsibilities for a wallet owned by an entity.
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The second consideration was compatible access to DeFi, which by nature is controlled by smart contracts and liquidity pools and no actual human-controlled items or deposits, as Mathew explains:
“A very unique challenge is that you don’t know who your DeFi counterparty is, but we have tools built into MMI that give you the ability to assess a DeFi pool before and after trading.”
The need for a specific institutional offering was due in part to commitments to institutional users who used the retail platform to manage millions of dollars in digital assets:
“It was shocking, the kind of risk management we saw from institutions. They had millions of dollars in assets in their browser plugins, or retail MetaMask browsers with a hardware wallet and a spreadsheet. That was really like the first crypto funds in the space were involved.
Mathew emphasizes that this is not for the purpose of organizations involved in trading and DeFi, as well as organizations exploring Web3 through various non-trading activities. This broadened the scope of MetaMask’s consideration of how to connect any organization to Web3 and not just traders or fund management companies.
The development of MetaMask Institutional took more than a year to complete, and Mathew described the team as being careful in its design not to become a repository of assets.
The result was MMI aggregated across a handful of recognized deposit stacks, as different parts of an institution’s portfolio require different insurance techniques and technologies:
“Different organizations have very different needs in terms of how they interact with Web3. Some might be high-frequency business-style operations that require low latency and programmatic access. And then another organization might be interested in engaging with their fan base with a application .suite which is very different is .
Mathew highlighted MMI’s efforts not to integrate vertically into the repository layer, but to aggregate horizontally through service providers that specialize in the governance layer and repository side layers. MetaMask Institutional now has 11 custodian partners, five of them based in Asia, a region where MetaMask is seeing increased participation.
In total, the 11 custodian partners already serve more than 1,800 organizations from a variety of industries, a point that Mathew believes will play a critical role in bringing businesses and service providers onboard Web3:
“When they want to access Web3, they basically go to their facility and say, ‘Turn on my access to Web3.’ Not everyone is ready for that yet, but we certainly have discussions with institutions.