2025 Wallet Ecosystem: The Turning Point from Tools to Revenue Products

The current wallet is not stagnant — it is quietly transforming behind the scenes

Many believe that by 2025, the wallet sector will be mature and growth will slow down, but in reality, a subtle technological revolution has taken place this year. Several major service providers have almost simultaneously upgraded their underlying architectures:

• A payment solution provider launched a self-custody scheme based on TEE technology
• A well-known spot trading platform implemented key sharding storage within a TEE environment
• Leading self-custody wallets have successively added social login features, backed by secure storage mechanisms for cryptographic key fragments
• Multiple large exchanges have introduced smart account features

Although no disruptive new products emerged this year, existing players have undergone a thorough transformation in ecological positioning and technological foundation. These changes stem from the rapid evolution of upper-layer ecosystem demands: as the popularity of BTC and Inscription ecosystems declines, wallets are repositioning themselves — evolving from simple asset storage tools to gateways into new sectors such as perpetual contracts(Perps), real-world asset tokenization(RWA), CeDeFi, and more.

Five stages of wallet evolution

From single-chain to multi-chain: an inevitable upgrade path for wallets

In early years (2009-2017), wallets were highly complex, sometimes requiring local node operation. The truly usable phase began around 2017 — self-custody became the preferred choice because the fundamental logic of the decentralized world is “default distrust.” Mainstream wallet products established user cognition during this period.

Between 2017 and 2022, public chains and L2 solutions exploded in growth, but most still relied on EVM-compatible architectures. A universal tool was sufficient to meet needs, and the core positioning of wallets was “useful tools.” Security, convenience, and stability were mandatory, but market space was limited.

By 2023-2025, the situation fundamentally changed. Heterogeneous public chains like Solana, Aptos, and BTC Inscriptions have completely reshaped user landscapes. Venture capital’s “thick protocol, thin application” financing logic has yielded little, but the market structure is indeed being reshaped.

Competitive focus in the multi-chain era

Faced with multi-chain fragmentation, even veteran wallets are forced to transform, supporting cross-chain functionality. Key metrics now include: how many chains are supported, and where transactions are initiated. This means extensive backend work, with the client only responsible for signature verification. For users, this determines whether they need to find RPC nodes themselves.

Multi-chain compatibility has become an industry standard. Sticking to a single-chain model is rapidly becoming unfeasible — ecosystem hotspots keep shifting, and those locked into a single chain will lose opportunities. Products once focused on a single ecosystem now face difficulties.

When tools are sufficiently user-friendly, competition shifts to the application layer

Once foundational tools mature, users begin to recognize the commercial value of wallets. True asset owners do more than store—they actively manage assets, seek yield opportunities, and select trading counterparts. DEX aggregators and cross-chain bridges have become key competitive areas.

But DEX is just the beginning. Yield products are expanding: real-world asset tokenization(RWA), perpetual contract trading, prediction markets (which will be hot in the second half of the year due to the 2026 World Cup). On-chain yields far surpass traditional finance — ETH staking offers about 4% APY, Solana staking plus MEV can reach 8% APY, and more aggressive liquidity mining strategies yield even higher. These are the yield signals(indicators of income) that wallet users are paying attention to.

Underlying technological updates in 2025: why change storage architecture

Implementing the above commercial demands requires new technological foundations. Automated trading involves advanced features like dynamic rebalancing, conditional orders, dollar-cost averaging, and stop-loss — difficult to realize under fully self-custody architectures.

The key question arises: can “maximum security” and “maximum yield” be achieved simultaneously? The answer is yes, because the market has different needs. During the Telegram Bot era, many users were willing to sacrifice private keys for automated trading — a high-risk, high-reward mode. Large service providers need to protect their brand reputation and cannot do this.

Is there a way to securely store keys, automatically execute trades, and ensure the service never disappears? Yes. This is the breakthrough in technology achieved this year.

How TEE technology reshapes wallet security

TEE(Trusted Execution Environment) refers to a special environment where server memory and execution processes cannot be read or tampered with by anyone (including server owners or cloud providers). After program execution, an attestation file(Attestation) is issued, allowing interacting parties to verify whether the code matches the published source. Trust is only established if the code matches.

Industry applications are widespread: Avalanche’s official cross-chain bridge runs on SGX; 40% of Ethereum mainnet blocks are generated by TEE-based builders; large exchanges have deployed TEE for cold/hot wallet signing for compliance and regulation by 2025.

However, TEE also faces challenges: low performance(costs can be high), data loss risks(, memory power loss), and complex upgrades.

Comparison of TEE solutions from different service providers

One payment solution provider adopts a centralized version: TEE is used only for key generation and signing transactions, with user authorization handled by the backend. The drawback is inability to verify if the backend adds extra instructions, though on-chain traces are available. The advantage is reputation protection — if keys are leaked, it will be recorded, preventing user fraud, with the only risk being service provider abuse.

A spot trading platform’s approach is similar, using gasless transaction addresses.

Social recovery schemes: a compromise for self-custody

Mainstream self-custody wallets vary but share core logic. One product uses the TOPRF mechanism: users encrypt their private key via TOPRF with email and password, which can be backed up; then the key is split and distributed via SSS(Shamir). Social verification providers obtain encrypted data, but full decryption requires the user’s password. Risks include weak passwords and email hacking, and if the password is forgotten, recovery is impossible.

Another product architecture is more complex: the key is split into two parts, one managed by a third-party network, with recovery requiring social login+PIN code(4-digit). As long as the email isn’t hacked and the PIN is remembered, recovery is straightforward. In extreme cases, two parties must collude to decrypt, but attack costs are increased. The third-party network is maintained by multiple verifiers, dispersing security.

Looking ahead to 2025 and beyond

This year marks a “deep but silent” change for wallets — seemingly quiet, but with profound shifts. Sufficiently convenient multi-chain tools are no longer competitive. The ecosystem demands more application support from wallets, and this year’s application layer market suddenly exploded: perpetual trading, real assets, prediction markets, payments — all became active.

Market activity, seen through Meme hype(large trading volume), is actually driven by the same group of people, with limited growth(. The focus shifted to DEXs with diverse demands. Supported by new storage systems like TEE, large exchanges’ reputation as a guarantee, and mature market infrastructure.

The rise of AI trading means wallets will no longer serve only humans but also AI agents. The next phase will see more explosive applications.

Yield products — CeDeFi products that can earn on-chain APY while maintaining autonomy)independent address mode( — will become the first choice for many CEX users. This is the key indicator of income)收益迹象( that will attract traditional exchange users.

Additionally, Passkey has made progress in cryptography. Ethereum and Solana are gradually integrating R1 curve support)device-native support, and wallets based on Passkey are another direction. Although recovery and cross-device synchronization still face difficulties, and applications are few for now, any product that can simplify high-frequency needs will eventually find its place.