Crypto smartphones: what are they, and are they worth your money?

Crypto smartphones emerged and started gaining popularity on the wave of the penultimate crypto hype at the end of 2017. The market has seen various models appear ever since that point. So what is the difference between a crypto smartphone (a.k.a. blockchain smartphone) and a regular phone with a crypto wallet installed? And is the gadget worth the cost?

On February 9, at the Unpacked 2022 virtual event, South Korean tech giant Samsung unveiled their new flagship smartphone: Galaxy S22 Ultra. Even before the presentation, a lot of tech media wrote that Samsung would now have its own smartphone crypto wallet. Some have even dubbed Galaxy S22 Ultra a “crypto smartphone”.

However, the presentation itself showed only Samsung’s focus on privacy and protecting personal information. Samsung Wallet 13 turned out to be a secure storage for the owner’s various identification data, such as driver’s licenses, student cards, ID cards, digital keys to a house or car, bank credit or debit cards, passes, and even COVID vaccination certificates.

The wallet runs on the company’s own payment platform, Samsung Pay. Security is provided by their Knox Vault system, which encrypts confidential information, personal data, and blockchain keys and stores them separately from the phone’s main OS. In the words of Samsung representatives, the smartphone’s built-in wallet was designed to give users access to a range of digital products, including cryptocurrencies.

Overall, the unveiling was somewhat disappointing. It was not a “blockchain smartphone”, just the same flagship with improved data protection. This, of course, is also important, but doesn’t make it an indispensable tool for a crypto holder. Still, the demand for a crypto-smartphone is there, as it has been for quite a while.

Operating cryptocurrencies requires a certain level of security. Numerous incidents of funds being stolen from users’ wallets have already dealt a severe blow to the reputation of digital money as a payment tool. An additional problem is the lack of interoperability. Using your mobile phone for DApps and cryptocurrency operations can prove difficult since ordinary smartphones can’t always work with blockchain applications.

In contrast, smartphones specialized for the blockchain are supposed to provide a secure storage for cryptocurrencies directly on the device and conditions for the mobile use of crypto as a means of payment. And, of course, they must serve their primary purpose.

HTC’s 2018 Exodus crypto smartphone was one of the first such models. The creators focused on providing a secure storage for private keys and user information. For this purpose, the device was equipped with a Secure Enclave coprocessor, which created a separate memory vault to protect data from the Android environment. Another security layer was the Social Key Recovery system, which enabled users to recover keys by providing information previously distributed between authorized accounts. The crypto smartphone was even self-programmable: owners could create decentralized applications and, if necessary, even their own applications for storing cryptocurrencies.

The phone had a pre-installed ZION crypto wallet, in which you can store BTC, ETH, LTC, and several ERC-20 and ERC-721 standard tokens.

Also in 2018, in November, saw the introduction of an even more impressive device – the Finney blockchain smartphone from Sirin Labs. It was named after Hal Finney, known as one of the pioneers of the cryptocurrency world. The gadget security was provided by a behavioral intrusion prevention system (IPS), as well as a blockchain system that creates barriers for unauthorized access. This crypto smartphone used a three-factor authentication system that utilized biometric data, blocking patterns, and behavioral factors. It even had its own token – SRN – acting as an internal currency and the patented Cold Storage Crypto Wallet system integrated into the device.

In addition to a built-in multifunctional wallet for cold storage of cryptocurrencies, Finney provided a token converting service and a center for working with DApps.

There were several other models from different companies, but those were mostly just regular smartphones with built-in crypto wallets.

Then Samsung stepped in and introduced the Galaxy Note 10 and Galaxy S20 models with their own crypto wallets based on a feature known as Samsung Knox.

In May 2021, the company announced plans to implement the Samsung Blockchain Wallet and access to cold wallets such as Ledger Nano S, Ledger Nano X, and others, on most devices in the Galaxy series.

Samsung Blockchain Wallet supports BTC, Ethereum, TRON, ERC-20, and TRC-20 tokens. It is only available on devices with Android version 9.0 and above. The wallet uses Knox technology to store user data by keeping the encrypted keys isolated from the main OS. A security processor protects all user information, which is only accessible by entering a PIN code or fingerprint. The blockchain wallet also has a built-in news feed about cryptocurrencies.

Overall, the range of options for a potential buyer is rather narrow. So, what should you choose? At various points, the author of these lines looked at and tested several different crypto smartphones and even considered buying Finney. But in the end, when I last changed my device in 2019, I got a BlackBerry KEY2. With security being a signature feature of those phones, all that was left was a crypto wallet (I installed a multi-currency + a couple of exotic ones just out of curiosity), as well as an app like DeFi Overview.

Generally speaking, any smartphone can be made into a “cryptophone” this way. Of course, you should beware of Chinese brands with their own skins (like MIUI) and numerous firmware pitfalls – too often they have issues with backdoors. For tech-savvy users, the best option seems to be something like Google Pixel – it comes with a “bare” Android OS, so you can install any security and crypto applications. Other options include Samsung, Sony, HTC, and other major manufacturers.

To sum up: Some models presented as “crypto smartphones” are really ahead of their time and can prove a helpful tool not only in day-to-day crypto operations but also as an advanced gadget that will stay relevant for quite a while. In 2018, that would be Finney, today you may look at Samsung Galaxy S22 Ultra. Yes, those are expensive, but it’s always like this with flagships.

Otherwise, instead of buying a mid-tier smartphone positioned as a crypto device, it might be better to purchase a high-end model and install security software, cryptocurrency wallets, and DeFi programs on it yourself.