Crypto Wallet Best Practices: Tips, Tricks and Alpha
Part 2: Crypto Wallet Advanced
Overview
Part 1 of this article delved into the basics of what a crypto wallet is, how it works and some of the best practices for keeping your crypto safe and secure.
The tips below are concepts that are very handy in getting an edge over the competition, particularly when the market heats up again and another bull run ensues. When money starts growing on the crypto trees again, as it did in the last bull run, every edge over the competition can mean the difference between a homerun or a seat in the bleachers.
1) Overview
Part 1 of this article delved into the basics of what a crypto wallet is, how it works and some of the best practices for keeping your crypto safe and secure.
The tips below are concepts that are very handy in getting an edge over the competition, particularly when the market heats up again and another bull run ensues. When money starts growing on the crypto trees again, as it did in the last bull run, every edge over the competition can mean the difference between a homerun or a seat in the bleachers.
2) Use Advanced Custom Gas Settings
In order to get the best experience out of your crypto wallet, in particular when it pertains to EVM-compatible chains and Ethereum specifically, it is quite helpful to understand how gas works, and how to use the advanced settings.
Gas on Ethereum has two main components. Gas can be viewed as the amount of computing power (or blockspace) required for a transaction. The more complex the smart contract, or combination of smart contracts, the more gas is required. Generally, standard transactions range from 21,000 at the low end to send Ethereum, and all the way to 500,000 for more complex mints or rarely in the case of multi-hop swaps.
The second component is the fee, which itself is broken down into two parts and is measured in Gwei (one billionth of an ETH). This is the fee you will pay PER unit of gas used. The base fee is effectively a protocol level fee whose value accrues to all other ETH holders, as it is burned out of existence. The priority fee is the portion of the fee paid to the validators for their work to include the transaction in the blockchain.
To best use this gas “complexity” to your advantage and to gain an edge it is well worth using the advanced gas settings. In Metamask, you would do the following: click on the top right logo circle < settings < advanced < advanced gas controls “on”. Then every time you initiate a transaction, it will provide you the option to edit the gas fees and customize all three components (gas, priority and base fees). When the hyped mints and sales are live, most participants will quickly hit the pre-populated “fast” or “aggressive” gas settings. Using the advanced settings in combination with the live gas trackers discussed below will give you a huge edge on the competition by being able to outbid them in real time.
3) Live Gas Trackers and Optimizing Gas Costs
To make sure you are optimizing your gas settings, you should bookmark a live mempool gas tracker such as TxStreet. This will give you live gas prices for Ethereum (and Bitcoin), and what I would call 2nd layer info on pending transactions.
The real value of this is twofold. First, you will save loads on gas costs by ensuring you are not overpaying versus real-time market conditions. Most wallets provide outdated estimates that are not really designed for cost efficiency or speed, but instead for simplicity. Secondly, in times of high demand for blockspace, you can ensure you are pushing your transaction through as fast as possible to snag that latest hyped NFT mint or token sale.
When your transaction is time-sensitive, always make sure to increase the max fee Gwei (cost of each gas unit) above the highest current gas prices (and add a margin), and increase the priority fee portion of the gas cost as this is what incentivizes the validators to pick your transaction from the mempool. You should also increase the gas limit itself, as the prepopulated gas amounts can occasionally be underestimated, which will end up reverting your transaction and wasting money.
4) Cancelling and Speeding up Transactions
We have all likely experienced the frustration of finding a great launchpad sale or NFT mint, ready to ape in face first, only to have gas prices skyrocket and our transaction stuck in limbo. Most wallets have built-in functions for this, but they are cookie cutter simplified versions, and there are much more effective ways of speeding up or cancelling transactions.
To outright cancel a transaction, the best way is to create a new transaction by sending ETH to yourself and changing the Nonce of that transaction to the same as the transaction you are trying to cancel. It is easier than it sounds.
Lets use Metamask as an example. First click on the transaction you are trying to cancel and note the Nonce. Then close the window and click on the following: account Icon in the top right > settings > advanced > customize transaction nonce “on”. Then go back to the main Metamask window and send yourself a small amount of ETH (eg 0.001 ETH), using the Nonce of the transaction to be canceled. This will effectively replace the previous transaction that you wished to cancel with a new one in which you are sending yourself ETH. Make sure to increase the Gwei (base and priority fee) substantially to ensure the transaction cancels as fast as possible. The relative costs should be minimal as sending ETH requires very little gas.
To speed up a transaction, you should use a combination of the built-in “Speed Up” button and the live gas tracker. When you speed up a transaction in most wallets, there is a prepopulated 10% increase in the Gwei, which is the minimum that the EVM will accept. In times of high blockspace demand, this increase can be insufficient and lead to a “stuck” transaction. Instead, in the case of Metamask, edit the Gwei by turning on the advanced gas settings and manually increasing the Gwei (base and priority fee), making sure to use the live gas tracker and increasing your Gwei above the highest current market price.
5) Using a Block Explorer (eg. Etherscan)
Using block explorers is a great way of understanding the various blockchain interactions/transactions and how to best optimize them. It also has some specific use cases such as revoking contract approvals, interacting directly with dApps, checking your on-chain assets, and lots more.
i) Contract Approvals:
This is a big issue in crypto, often overlooked as a safety risk to your portfolio. When you swap on a Dex, or bridge tokens, or mint an NFT, you are giving that protocol approval to access the token in question without any further action by you, often without limits. This leaves a user open to having their wallets drained by bad actors, changes in the protocols, poor protocol security and protocol exploits.
There are two ways to mitigate this safety risk. First, only allow unlimited approvals for the most trustworthy platforms (eg Uniswap, Aave). Otherwise, edit the approval amount to the exact amount required, so that you are limiting your potential loss. Second, revoke any approvals you no longer need. This can be done by going to www.etherscan.io and connecting your wallet. Go to the Tools bar, then click on token approvals. You will see a list of every token contract approved and what platform has access, including ERC20 and NFTs. Click on revoke approval, sign the transaction, and once confirmed that protocol will no longer have access to your crypto.
ii) Checking your Assets on Chain:
This is fairly straight forward, and bypasses the limitations of certain wallets and tracker platforms. Go to etherscan.io (or other block explorer), copy your wallets address from your wallet, and paste into the search bar on the block explorer. Then click on the little folder icon beside the drop down token menu near the top left. This will give you a full breakdown of all the assets held in that ethereum (or other chain) address.
iii) Direct Contract Interactions:
This is one of the more fascinating tools available to those who enjoy a deep dive, and are a bit more technical. If there is an upcoming mint, or token generation event (TGE), you can occasionally get a leg up on everyone else by claiming your tokens or NFTs before the front end websites make the option available to the public. You can also approve tokens for swapping on a particular Dex before you even receive them, and in the initial pump sell into the bots while everyone else is still trying to get their approvals through. In the case of a front end website going down, you can also retrieve your assets directly from the protocol (see Tornado cash). For the tech savvy readers, this can be done by bringing up the contract page on etherscan, connecting your wallet, and opening the “write to contract” tab. A rundown of how this works would be a full article on it’s own, but use of this function should be kept to technical users only.
CONCLUSION:
The world of crypto has had a rough year, and as the bear market rages on, those of us here for the long haul are looking to build and learn so that we can avoid the mistakes we may have made in the last bull run, and add value to the space that we love and that is so well positioned to be the biggest innovation of our lifetimes.
The gateway to all of it, and to the mass adoption we know is coming, are the user interfaces and user experiences. Wallets ARE that gateway, and as early adopters we are perfectly positioned to to take full advantage of the coming crypto gold rush. If crypto is the new wild west, it is full of opportunity to changes lives for the better, but also full or risks along the road. Knowledge is how we navigate those risks, avoid the bandits, and make life changing gains along the way.
Good luck out there!
Sovereign Crypto (Aka. RickyBobby | XBorg )
Xborg Content Council
