Digifox was launched on 16th June 2020 by popular cryptocurrency YouTuber Nicholas Merten (a.k.a DataDash). It is an app available on iOS and Android aiming to be an all-in-one finance application to give “finance for everyone”. Here we take a look at this brand new app and review whether it really lives up to its ambitious goals to be THE all-in-one finance application for everyone.
Digifox functions and features
Digifox allows users to grow their portfolio and aims to simplify the investment process. The app also has the usual features of all online cryptocurrency wallets such as sending and receiving cryptocurrencies. Here’s an overview of Digifox’s major functions and features.
Currently the app allows trading in over 14 cryptocurrencies through its partnerships with Kyber and Uniswap. Kyber and Uniswap are Ethereum-based protocols that allows instant conversions and exchanges of cryptocurrencies and digital assets. Most importantly, Digifox’s integration of Uniswap means that Compound ($COMP) token is now available for trading. Compound is currently THE hottest Decentralised Finance (DeFi) token out there with a market cap of over USD$582 million.
Digifox allows users to earn interest on their deposits. The amount of interest earns varies from 5-9%. This is much higher, in fact almost 50-100% higher than the US national average for interest on deposits. Digifox appears to be able to give users such high returns through its various revenue streams including lending, borrowing, trading and transactions.
An exciting feature which is going to come soon is the ability to spend your money and cryptocurrencies using the Digifox debit card. By partnering with Visa, Digifox will allow users to spend at any Visa merchant. What’s more, to incentivise spending with the debit card, merchants can offer up to 2% cashback simply for spending money there.
Of course the Digifox wallet also allows users to send and receive their cryptocurrencies to others. As with most cryptocurrency wallets, users can transfer their cryptocurrencies by either typing in the recipient’s full cryptocurrency address, or by scanning a QR code. One unique feature with Digifox is that it allows easy sending of cryptocurrencies with other Digifox users simply by username, and you can save a contact list of the people you frequently transfer cryptocurrencies with. This is similar to some online payment platforms such as Venmo or HSBC’s Payme. It sounds very simple, but it is certainly a function most cryptocurrency wallets do not, but SHOULD have. So props to Digifox for incorporating this.
As with most cryptocurrency software wallets out there, Digifox allows deposits in cryptocurrencies. Digifox takes it a step further by also offering the ability for users to connect their bank accounts and debit cards. This feature is supported in over 25 countries including the US, Europe, Canada, Australia and India. According to Digifox, they will soon be able to support debit card deposits for over 150 countries.
Is Digifox safe?
Digifox refers to itself as a “smart wallet”, it allows cryptocurrency enthusiasts of any levels to be able to recover their wallets in ways in which they are familiar. Digifox users use email and two-factor authentication to recover their wallets, rather than seed phrases. This would mean that users no longer have to worry about remembering or copying down and safely storing their seed phrases. But if that is the case, does it mean that Digifox would keep your private keys, and what happens if Digifox suffers a security breach? Most high grade cryptocurrency software and hardware wallets employ the seed phrase method for recovery, and some of them have never been hacked. Surely there’s a reason they use this method for security?
As for how Digifox keeps users funds secure, little is known about this so we may need to wait for the Company to release more information in due course.
Is Digifox legit? Some concerns we have
Since this article was first published Digifox has launched their website at Digifox.finance. In their new FAQ section they cover topics such as how to make deposits, earn interest and buy cryptocurrencies.
Granted the wallet is newly launched, but it was in development for some time and had asked people to fund them so we’d expect that all the information on the product would be easily accessible for potential users to see?
We also noticed that Digifox offers very attractive interest rates, namely 5-9%. From our research it seems that they can give users this interest through their various revenue streams such as lending and borrowing. Which makes us wonder if they are a bank? In which case, where is Digifox based and registered? And are they subject to any regulations or user protections? All this is unknown.
Finally, whilst we also don’t like memorising or carefully storing seed phrases, we do feel a bit insecure with recovering our account simply via email or 2-factor authentication. It would seem to be quite vulnerable to hacks. What is the more worrying implication is that Digifox, rather than you who keeps your private keys. And this goes against almost every advice out there about how to keep your cryptocurrencies safe.
We do know that Digifox has a strong team behind them, and from what we have tried on the wallet so far it does seem to be a good product. However despite their new website and FAQs there is a lot we do not know about them, including potential issues down the road such as security and regulatory aspects. We hope to see more updates from them in due course but for now we still think it’s definitely worth downloading and trying out.
How to register for a Digifox account
Signing up for an account is very easy and no KYC procedures are required. All you need to do is download the app either on the Apple App Store or the Google Play Store for Android users. In the app, click Sign Up and enter in your email and telephone number. You will then receive a confirmation code via SMS which you enter into the app.
Your wallet will then be activated which the app says takes around 2 minutes to complete. In our test it did take around 2 minutes and did not require us to do anything, so we just waited for it to complete.
For security, you will also be asked to choose a 4-digit PIN code which you are required to enter when using several functions on the wallet. This is very helpful for maintaining security and preventing misuse.
Then you are all done! For us the whole process took around 5 minutes and we thought the process was very intuitive and hassle free.
What’s next for Digifox?
From 7th July onwards, users can deposit their Bitcoin, Litecoin and other cryptocurrencies with their partners such as Celsius. Eventually Digifox will allow users to generate a secure public/private key pair to hold your cryptocurrencies. Note however that users will not have actual custody of the digital assets, though Digifox will allow users to manage them.
Updates to the Digifox app
Digifox will be completely refining their app over the course of the week commencing 6th July 2020.
Adding more deposit partners
Currently Digifox is partnered with Gem and Celsius. However the Company has teased that more deposit partners will be added in the future.