Founded in 2016, based out of Hong Kong, the start-up company Freewallet provides services as a digital cryptocurrency wallet provider available on IOS and Android devices. They support about 25 different currencies such as Bitcoin Ethereum Dash Litecoin Monero and other coins. In 2017, Freewallet released a web version for their multi-wallet app as well as a token wallet app on android.
THE HEIST
Since inception there has been some controversy on different occasions. One of those issues in particular was in 2017, when 8.5 million dollars went missing out of many users accounts. It didn't take long before the conspiracy theories started flying in about a possible hack. As the day went on, about 13 hours into it, Ethereum continues to leave users wallets getting sent to just one address. In fact, It wasn't until co-founder Alvin Hagg finally issued a statement many hours later, saying that Freewallet moved the users funds to cold storage due to congestion on ethereum blockchain caused by Bancore Network ICO. This was done with no warning or message to users that Freewallet would be performing these transactions. I can only imagine what users were going through watching their money leave their wallet with no explanation. That is just very inconsiderate and unprofessional on the platforms behalf.
(Picture above showing the $8.5 Million in users funds being sent to cold storage wallet
THE HARD FACTS
Currently Freewallet is charging their users the highest transaction fees per transaction when sending to a wallet provider other than a Freewallet users. It is transaction free when sending from one freewallet address to another freewallet address but that feature seems pretty useless considering most transactions leave the freewallet network so its not very beneficial.
Let's look at an example, if we want a bitcoin transaction to be confirmed within the next 3 blocks, within 30 minutes, it will cost 10 Satoshis per byte. That's with the median setting at roughly 225 bytes per transaction. So that would cost a user in total 2,250 Satoshi's (0.00002250 btc) or $0.20 cents.
(Courtesy of Earn
Now If you want to have your bitcoin transaction confirmed within the very next block which would take anywhere from 1-10 minutes, this will cost you 50 satoshis per byte which is just over 11,000 satoshis (0.00011 btc) or $0.95 cents.
Now with Freewallet if you want to send a Bitcoin transaction you will be charged 40,000 satoshis (0.0004 btc) or $4.00 at current bitcoin price. That's just for sending $1.50 worth of bitcoin we used foe this example. That price that they charge will never go any lower but it certainly will go higher which we witnessed in the past.
(Snapshot above is a attempted Freewallet.org bitcoin transaction which can't be sent because fee is to high)
The big issue is they are not using that full fee amount being charged to Freewallet users as they seem to be keeping the difference to make a profit. Another important issue to bring up is that these extremely high fees are not just with their bitcoin wallets but all their supported currency wallets like ethereum, litecoin, dash, monero, bitcoin gold and so on.
A good example, Dash recently completed a upgrade to their network not that long ago which brought transaction fees down significantly. So if you were to use a different wallet provider like Coinomi, your transaction fee would only cost 0.0001 Dash or $0.25. If you sent tgis same amount of Dash using Freewallet you will pay 0.01 Dash, the equivalent to $5.00 at the minimum. Thats the most ridiculous and insane amount just to send some coins.
CONCLUSION
Freewallet doesn't allow users to adjust their own transaction fees like most custodial (no control over private keys) wallet providers do.
We recommend using wallets like Coinomi or Mycelium as these are great wallet providers. If you go to our Crypto Wallet page you can read up on many other wallet providers to store your cryptocurrency including hardware wallets like Trezor or KeepKey. When it comes to keeping your money safe you need a wallet you can depend on, one that will be their with answers and solutions when you need them most. A wallet that the users have total control over. Something that seems to be lacking with Freewallet and for these reasons we are warning users to be very cautious if your using their platform.
