America’s leading crypto exchange, Coinbase, unveiled Smart Wallet, a product it had first talked about at the beginning of the year.
The San Francisco-based exchange said that Smart Wallet has been designed to facilitate decentralized finance (DeFi) users who wish to enter the space.
The announcement
Coinbase’s senior director of product management, Siddharth Coelho-Prabhu, announced in a blog post.
He said that it would take only a couple of seconds for users to create a secure and free self-custody wallet via the Smart Wallet feature.
He revealed that it simplifies the onboarding process and allows users to seamlessly access their Coinbase balances. Plus, it also reduces the number of transactions that require signatures.
Coinbase first announced the said product at ETHDenver this year in February. Smart Wallets give access to DeFi services and apps without requiring traditional extensions, apps, and recovery phrases.
Instead, they use industry-standard Passkeys, along with a companion web portal that connects to various networks.
The networks that are supported as of launch include Optimism, Ethereum, BNB, Avalanche, Arbitrum, Base, Zora, and Polygon.
Coinbase has introduced this wallet to facilitate DeFi users because there are a lot of hurdles they have to face, especially when they are getting started.
Smart Wallets
Coelho-Prabhu said that users have had to experience a lot of issues with going onchain. They are limited to first-generation blockchains and require the installation of separate wallet apps.
It has been costly, slow, and difficult, but Coinbase Smart Wallet provides an easy solution. It allows users to create a new wallet with YubiKey, a Google Chrome profile, Face ID or a fingerprint unlock feature.
Another issue that Smart Wallets aims to resolve is the fragmentation of funds. This usually happens when users have spread their balances across different wallets.
With this new product, users will not have to worry about fragmentation issues when using a range of crypto apps.
They will be able to conduct transactions anywhere and use their Coinbase account balance. In fact, they will also have the option of using their self-custodial wallet balance.
The adoption
To boost the adoption of its Smart Wallet, Coinbase is also offering incentives to crypto developers to integrate the product into their apps.
It has introduced a Base Gasless Campaign to offer gas credits of about $15,000 to developers. It has also offered other incentives, such as On-Chain Summer contests.
Coelho-Prabhu said that since only a few lines of code are needed for integrating smart wallets, it is not very complex.
He also noted that the system had already gone live and popular crypto code libraries are already offering support for it.
Smart Wallets also make gasless transactions possible. This is possible via ‘paymaster’ sponsorships where the gas fees of the user are covered by developers or other parties.
The goal is to provide a service or a product free of cost. According to Coelho-Prabhu, all of this is part of Coinbase’s vision to boost crypto adoption.
He said that smart wallets were part of the company’s mission to integrate 1 billion users into the crypto universe.