The cryptocurrency wallet market in 2025 is witnessing a brutal share competition.
Article author: Zhou
Source: ChainCatcher
As the meme coin craze subsides, high-frequency trading users have begun to flock to exchange-based wallets with lower fees and stronger incentives. In the face of the ecological closed loop of exchanges, the survival space for independent players is continuously being compressed.
Against this backdrop, Phantom's performance has attracted attention. At the beginning of the year, it pushed its valuation to $3 billion with a financing scale of $150 million. Since the fourth quarter, the project has consecutively launched its own stablecoin CASH, prediction market platform, and crypto debit card, attempting to find new growth points beyond the trading business.
A $3 billion valuation, starting from Solana and expanding to multiple chains
Looking back at the development history of Phantom, the Solana ecosystem had just exploded in 2021, and the on-chain infrastructure was still not perfect. Traditional crypto wallets like MetaMask primarily supported Ethereum and lacked compatibility with other chains, resulting in certain shortcomings in user experience.
Typically, when creating a wallet, users must manually write down a seed phrase of 12 or 24 words, and if the keys are lost, the assets will be permanently unrecoverable, which makes many potential users feel cumbersome and risky.
The three founders of Phantom previously worked for years at 0x Labs (an Ethereum DeFi infrastructure project). They seized this opportunity, choosing to start with Solana to create a wallet with a simple interface and intuitive operation. Their core innovation lies in optimizing the backup process: offering multiple simple methods such as email login, biometric recognition, and encrypted cloud backup, which assist in replacing the manual writing down of seed phrases, significantly lowering the entry barrier for newcomers.
In April 2021, the Phantom browser extension was launched, and within a few months, the user base surpassed one million, becoming the preferred choice for Solana users. According to RootData, in July of the same year, Phantom, still in the testing phase, secured $9 million in Series A funding led by a16z; in January 2022, Paradigm led a $109 million Series B round, valuing the company at $1.2 billion; by early 2025, Paradigm and Sequoia once again led a $150 million round, pushing its valuation to $3 billion.
As it scaled up, Phantom then began its multi-chain expansion, supporting multiple public chains including Ethereum, Polygon, Bitcoin, Base, and Sui, attempting to shed the label of being a "Solana-only wallet." However, Phantom still does not natively support BNB Chain, and there have been complaints from users about Phantom supporting ETH but not BNB Chain, leading to issues with airdrop eligibility.
The joys and worries of 2025
The year 2025 will be a mixed bag for Phantom: on one hand, there are rapid breakthroughs in user and product levels, while on the other hand, trading volume shares are being significantly eroded by exchange-based wallets.
Specifically, user growth is a bright spot. Phantom's monthly active users increased from 15 million at the beginning of the year to nearly 20 million by the end of the year, with growth rates among independent wallets ranking at the top, especially notable in emerging markets like India and Nigeria.
At the same time, Phantom's managed asset scale has surpassed $25 billion, having reached a weekly revenue of $44 million at peak times, and annual revenue once surpassed that of MetaMask, with Phantom's cumulative revenue currently nearing $570 million.
However, concerns regarding trading volume are also prominent. According to Dune Analytics, Phantom's share of the embedded swap market dropped from nearly 10% at the beginning of the year to 2.3% in May, and further shrank to only 0.5% by the end of the year. Wallets associated with exchanges attracted a large number of high-frequency trading users due to their fee advantages, rapid product launches, and substantial airdrop subsidies, with Binance Wallet currently dominating nearly 70% and OKX (wallet + routing API) accounting for over 20%.
The market's greater concern about Phantom lies in its deep binding to Solana. Data shows that 97% of Phantom's swap transactions occur on Solana, while the total locked value (TVL) of Solana has fallen over 34% from its peak of $13.22 billion on September 14, currently down to a six-month low of $8.67 billion. This directly drags down Phantom's core trading metrics.
In the face of these pressures, Phantom is betting its resources on new products, attempting to open up a second growth curve.
From a product perspective, Phantom has launched a series of differentiated features:
In July, it integrated Hyperliquid perpetual contracts, driving approximately $1.8 billion in transaction volume in just about 16 days, generating nearly $930,000 in revenue through a rebate mechanism (builder codes);
In August, it further consolidated coverage of segmented trading demands by acquiring the meme coin monitoring tool Solsniper and the NFT data platform SimpleHash.
The native stablecoin CASH, launched at the end of September, quickly surpassed $100 million in supply, with transaction peaks exceeding 160,000 in November, and its core competitiveness lies in fee-free P2P transfers and accompanying lending rewards;
In December, Phantom Cash debit card was launched in the U.S., allowing users to spend on-chain stablecoins directly with the card and compatible with mainstream mobile payments like Apple Pay and Google Pay;
On December 12, it announced the launch of a prediction market platform, integrating the Kalshi prediction market within the wallet, which is now open to eligible users;
It also launched a free SDK, "Phantom Connect," allowing users to seamlessly access different web3 applications with the same account, further lowering the onboarding thresholds for developers and users.
Among them, the most notable are the debit card and CASH stablecoin, as Phantom attempts to solve the "last mile" issue of spending crypto assets through them.
Phantom CEO Brandon Millman has publicly stated that there will be no token issuance, no IPO, and no self-built chain in the short term, and all efforts will be focused on refining the product to make the wallet a financial tool that ordinary people can use. He believes that the endgame of the wallet track is not about who has the largest trading volume, but who can first integrate crypto into everyday payments.
However, the "last mile" for cryptocurrency payments is not an easy road, and Phantom is not the first independent non-custodial wallet to launch a debit card.
Prior to this, MetaMask had already partnered with Mastercard, Baanx, and CompoSecure in Q2 2025 to launch the MetaMask Card, which supports real-time conversion of cryptocurrencies to fiat for spending and has rolled out in regions like the EU, UK, and Latin America. MetaMask's card has broader coverage and was launched earlier, but is limited by the Ethereum and Linea networks, resulting in higher fees and slower speeds, with user feedback indicating "convenient but not frequently used."
In contrast, Phantom's debit card started relatively late, currently only being rolled out in a small scale in the US, with the actual adoption situation still to be observed. Theoretically, it relies on Solana's low fee advantage and may be more competitive in fee-sensitive emerging markets, but it still has a significant gap in global coverage and merchant acceptance compared to the MetaMask Card.
In terms of stablecoins, if CASH fails to form a sustained network effect, it may follow the path of other wallets' native stablecoins that had a "high start, low finish," such as MetaMask's native stablecoin mUSD, which quickly surpassed $100 million in supply after launch but fell to about $25 million in less than two months.
Conclusion
As the meme craze fades, trading volume is no longer a reliable moat, and independent wallets must return to the essence of financial services.
Overall, Phantom integrates Hyperliquid perpetual contracts and the Kalshi prediction market on the trading side to retain high-end users; on the consumption side, it bets on the CASH stablecoin and debit card, attempting to bring on-chain assets into daily life.
This dual-track drive of "trading derivatives + consumer payments" is Phantom's self-redemption under the pressure of the Matthew effect in the wallet track. It is not only seeking a second growth curve but also defining the endgame for independent wallets.
