Highlights:
- Coinbase announces the launch of its new “smart wallet.”
- The wallet seeks to attract 1 billion users, offering a gasless on-chain experience and multi-chain integrations.
- The anticipation of the smart wallet caused a spike in Base TVL.
Crypto exchange Coinbase has announced the launch of its highly anticipated “smart wallet”, designed to onboard billions of users to Web3. The new Coinbase wallet will enhance user convenience by streamlining onboarding, eliminating gas fees, and removing the need for recovery phrases. This development follows a wave of innovations in the crypto space aimed at improving speed, security, and interoperability.
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The wait is over. Smart wallets are here. pic.twitter.com/jtXUNu1dq3
— Coinbase Wallet 🛡️ (@CoinbaseWallet) June 5, 2024
Gasless Transactions and Easier DeFi Access
Coinbase’s new smart wallet offers a “gasless” on-chain experience, lowering transaction costs through multi-chain integrations. At the start, the smart wallet will support the Base, Optimism, Arbitrum, Polygon, Ethereum, Avalanche, BNB Chain, and Zora networks. It will be free for both developers and users.
Coinbase said:
“This simplicity, combined with multi-chain support and integration with major applications, will make onboarding to the blockchain as effortless as signing into your favorite website.”
A companion web app will be the user’s primary platform and offer identity and asset management. It will allow users to send, swap, buy, and manage non-fungible tokens (NFTs) and view their transaction history. Coinbase encourages developers to integrate the smart wallet into their apps, offering up to $15,000 in gas credits through the Base Gasless Campaign. Moreover, coinbase will provide existing customers with migration tools that enable smart wallets within the Coinbase Wallet app.
Seamless Onboarding and Self-Custody with the Smart Wallet
The smart wallet enables users to create a new wallet and onboard onto a blockchain without the need for downloading a new app or receiving a new recovery phrase. Instead, the smart wallet integrates with major apps. It utilizes users’ Google Chrome profile, fingerprint ID, Face ID, or Yubikey to onboard through a passkey stored on their devices. Moreover, the smart wallet aims to attract 1 billion users by addressing issues with onboarding, network fees, and recovery phrases.
The smart wallet will offer self-custody and allow payments from the user’s Coinbase Wallet or Coinbase account. Additionally, developers can opt to cover gas fees by sponsoring transactions through a paymaster.
Coinbase Smart Wallet Launch Spurs Record Activity on Base Network
The introduction of the Smart Wallet has spurred heightened activity on Coinbase’s Layer 2 network, Base. Total value locked (TVL) on Base has soared to an all-time high of over $1.771 billion, marking a 1.5% surge in the past 24 hours.
Leading protocols such as Aerodrome, Uniswap, and Extra Finance have been notable contributors to this surge. The increase in activity coincides with traders’ anticipation of the smart wallet release. Given the current surge in crypto asset prices, users expect further inflows. Data from the blockchain analytics platform GrowThePie reveals that Base’s transaction count surged 7.1% to reach 2.7 million in the past 24 hours, surpassing Arbitrum’s 1.89 million transactions.
Smart Wallet Technology Gains Momentum
While smart wallet technology is not novel, Loopring and Argent were pioneers in its development back in 2020. In the subsequent year, Ethereum developer Vitalik Buterin embraced the concept in his blog, advocating for the “social recovery” features that enhance security and remove the need for recovery phrases.
Why we need wide adoption of social recovery wallets:https://t.co/I64yn6toMO
— vitalik.eth (@VitalikButerin) January 10, 2021
The groundbreaking technology for smart wallets on Ethereum, known as “account abstraction,” made its debut with the ERC-4337 standard in March 2023. Buterin reiterated the virtues of smart wallets in a blog post in June 2023.
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