Metaversal is a Bankless newsletter for weekly level-ups on NFTs, virtual worlds, & collectibles

Dear Bankless Nation,

A pillar of crypto and NFTs is their self-custody potential, which people can rely on to take full control of their digital things. 

One of the best ways to safely store your own blockchain assets are “cold wallets” like hardware wallet devices. Think Ledgers, Trezors, the GridPlus Lattice, etc. 

The problem? In the NFT space folks often store their blue-chips and grails on cold wallets, but then are compelled to use these wallets to claim airdrops their NFTs qualify for. 

Accordingly, under this security paradigm all it takes to swipe a cold wallet’s precious NFTs is one convincing lookalike scam website tricking a user into signing one transaction they don’t understand. 

The good news? With solutions like delegate.cash, you can now keep your NFTs safe while still actively using your cold wallet however you like via delegation. 

For today’s post, then, let’s walk through the basics of delegate.cash and how you can use it to step up your NFT security!

-WMP

Sponsor: Kraken — the most trusted and secure crypto exchange in the world

Cold wallet, hot UX: using delegate.cash to safely degen

What’s up

Millions and millions of dollars worth of NFTs were stolen by scammers last year. In September 2022, auditor, developer, and writer foobar introduced delegate.cash, an “immutable primitive to safely claim airdrops for vaulted NFTs,” as a way to help mitigate these scams.  

This NFT safety solution has been gaining traction ever since as a growing number of projects have directly embraced it, including large NFT studios like Yuga Labs. Other notable projects that already support delegate.cash include Art Blocks, CyberBrokers, and Forgotten Runes Wizard’s Cult.

Garga.eth (Greg Solano) @CryptoGarga

A hardware wallet is incredibly important. But the next step is delegating your cold wallet to a proxy so you can reduce the frequency of hooking up valuable cold wallets to websites.

Bored Ape Yacht Club @BoredApeYC

Heads up, Apes: you’ll be able to use a warm wallet through https://t.co/WGWLQY9try or https://t.co/Spha4pZXJp for next week’s mint. We recommend setting up the wallet ahead of time.

3:05 AM ∙ Jan 11, 2023

---

457Likes70Retweets

How delegate.cash works

Simply put, delegate.cash lets you secure your valuable NFTs while still actively using them to participate in activities like airdrop claims or DAO governance. 

The system is a smart contract-based registry that, among other things, lets you delegate your cold wallet’s NFT powers to a burner “hot wallet” of your choice like a MetaMask account. Your NFTs will stay in your cold wallet no matter what, but your linked burner can then act on their behalf. 

With this delegation system, you get the perks of a hardware wallet without having to reach for it every time you need to sign a transaction. 

Additionally, if you do ending up degening into a scam project, any fallout will be limited to your delegated burner that you’ve specifically isolated in case of attack. The NFTs in your cold wallet will remain utterly untouched!

Lastly, keep in mind that delegate.cash is totally immutable (no admin powers or attack vectors), totally onchain (no offchain signature vulnerabilities), and totally independent (self-sufficient with no external dependencies). This trifecta means anyone can reliably use this solution in permissionless fashion. The system is also able to be deployed on any Ethereum Virtual Machine (EVM) chain.

foobar @0xfoobar

@Floatingfurther @delegatecash delegatecash is already on: – ethereum – polygon – avalanche – arbitrum – optimism – fantom – celo and all corresponding testnets can be permissionlessly deployed onto any EVM chain of your choice as well, so should be compatible!

10:01 PM ∙ Jan 10, 2023

---

10Likes4Retweets

How to use delegate.cash

On delegate.cash and in the context of NFTs, it’s possible to 1) delegate all your cold wallet’s NFT powers to a hot wallet of your choice, or 2) delegate a single NFT’s powers to your desired wallet. 

If you’re interested in the first option, delegating to a throwaway burner, you would follow these steps:

1. Go to delegate.cash

2. Connect the cold wallet you vault your NFTs in, e.g. a Ledger device

3. Copy the address of your designated burner wallet and paste it into the delegate.cash “Wallet” UI like so:

3. Press the “Submit Delegation” button and complete the transaction with your cold wallet to finalize your entry in the registry

4. That’s it! You can then track that and future delegations using the “View recent delegations” button below the Wallet delegation UI

5. Remember: your linked burner will only represent your cold wallet for certain utilities, it can’t be abused to drain any NFTs from within your cold wallet!

If you’re interested in just delegating a single NFT’s power instead, the process is similar to the one described above. You’d flick over to the “NFT” UI, paste in your desired hot wallet to link, then input the address of the NFT contract and your token ID # and fire off the final transaction to finish up. 

Why it matters

NFT scammers have gotten increasingly sophisticated in recent years, so it’s no surprise that look-alike trap websites have ensared plenty of earnest minters so far. 

With solutions like delegate.cash, though, we now have a great defense against this attack vector. We can start turning the tide against these scammers accordingly by teaching more and more people to firewall their valuable NFTs via wallet delegation!

Action steps

• Delegate to a hot wallet — If you have any big airdrop claims coming up, consider trying out delegate.cash to defend your grails

• Check out my previous write-up if you missed it: The Open Edition Boom

Author Bio

William M. Peaster is a professional writer and creator of Metaversal—a Bankless newsletter focused on the emergence of NFTs in the cryptoeconomy. He’s also recently been contributing content to Bankless, JPG, and beyond!

Subscribe to Bankless. $22 per mo. Includes archive access, Inner Circle & Badge.

Thanks to our sponsor

KRAKEN NFT

Kraken NFT is built from the ground up to make it one of the most secure, easy-to-use and dynamic marketplaces available. Active and new collectors alike benefit from zero gas fees, multi-chain access, payment flexibility with fiat or 200+ cryptocurrencies, and built-in rarity rankings. Learn more at Kraken.com/nft

Visit Kraken.com to learn more and open an account today.

Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research.

Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here.