On the surface, the crypto industry appears to be in good health. BTC has been flirting with all-time highs, institutional adoption is ramping up and volume has been holding steady. There’s a lot to be bullish about in Q4. Which is why the news that Consensys was laying off more than 160 employees, citing macroeconomic reasons, came as a surprise.
Best known for developing web3 wallet MetaMask, Consensys is a tech giant of the blockchain world, employing more than 800 staff. That number has now been whittled down as the company sheds 20% of its workforce, with CEO Joseph Lubin blaming everything from heavy-handed SEC regulation to a macro outlook that necessitated slimming down.
While the transition to a leaner company is likely a sound strategy from an operational perspective, it raises questions about the future of MetaMask, Linea – the Consensys EVM L2 – and the Ethereum ecosystem at large. In a year where ETH has lagged badly behind SOL and BTC, and other networks including TON have gained market share, Consensys and MetaMask are simply not as relevant as they once were.
While the company has no intention of halting development of its core products, the news has given DeFi users an additional incentive to explore alternative web3 wallets and networks – and there’s no shortage of solutions seeking to entice them. Whichever wallet can master the multichain universe won’t just gain market share from MetaMask – it will position itself as the gateway to web3, with all the upside and weight that carries.
Life After MetaMask
MetaMask isn’t going anywhere. But its users may be. Not on account of anything Consensys has announced, but due to a gradual transition away from EVM-focused wallets to alternatives that can offer entry to the broader multichain landscape. Like MetaMask, Ethereum is very much still alive. But it’s clear to anyone who’s spent five minutes in crypto that the chokehold Ethereum once had over onchain volumes and innovation is long gone.
Solana has been the primary beneficiary, cornering the degen market with its high throughput, low fees, fast confirmation times, and poly-memecoin landscape. But it’s not the only chain to which these qualities apply; networks such as Sui, TON, and to a lesser extent Tron have all taken a bite out of Ethereum’s lunch. These are chains that MetaMask doesn’t touch and thus for chain-hoppers chasing the latest opportunities, it’s been necessary to seek out alternative web3 wallets, and there are plenty of candidates to choose from.
Ctrl (formerly XDEFI) is probably best placed to succeed here, offering broad multichain support coupled with useful features such as gas abstraction on every chain. Ctrl’s value proposition is that it puts an end to the days when DeFi users would need half a dozen browser extensions to keep up with the latest farms, DEXs, and narratives as they pop up on far-flung networks.
For navigating TON, meanwhile, Tonkeeper is by far the dominant wallet and for good reason: it’s easy to use, available for multiple devices – including Telegram – and natively integrates a wide range of TON dapps. It’s not a like-for-like MetaMask replacement but it does embody the sort of innovation that’s characterized a new breed of web3 wallets, leaving the Consensys counterpart playing catch-up.
Web3 Is Changing
Joe Lubin is no fool and he knows which way the wind is blowing. As he acknowledged in a blog post confirming the shake-up, “Looking ahead, I see a next-generation economy not dominated by large monolithic companies; instead, smaller, agile, AI-supercharged companies with Web3-based coordination tools will operate more efficiently.”
AI is changing everything it touches and crypto has embraced it harder than perhaps any other tech sector. Now it’s the turn of AI to reshape the sector in its image. Indeed, the signs are already there: in the AI memecoins pulling crazy numbers on Pump.fun; in the Telegram bots powered by AI that provide market insights, trading strategies, and filter out the noise. These are all areas where Consensys and MetaMask have yet to set foot, while nimbler upstarts, including wallet developers, have wasted no time in stamping their mark.
The question for Lubin and Consensys is whether they stick with what they know or take risks and branch out into blockchains and technologies unknown. There’s still plenty of life in Ethereum and Consensys is still a major developer of solutions for its ever-evolving L2 ecosystem, including Linea which remains a company priority. In the meantime, web3 rivals sense an opportunity to gain ground and make their mark on multichain.
Image by Photospirit from Pixabay