Wallet
Smart Contract Wallet
What is Smart Contract Wallet？
Most wallets have traditionally been Externally Owned Accounts (EOAs). These are controlled by a private key (which you can think of as a password for crypto). Smart contract wallets are an alternative. They’re built on smart contracts, as the name suggests, and allow for more functionality. Smart contract wallet accounts are controlled by their code, which can be written to implement arbitrary logic.
Importantly, smart contract wallets can be compiled for exactly the same experience as EOA (e.g. only one signing key, non-upgradable), but not vice versa.
Controlled by a user Accessed via private keys Can make transactions and trigger contract accounts
Controlled by code that executes when triggered Have no private keys Can trigger other contract accounts
Thanks to the versatility of smart contracts, in addition to breaking user reliance on private keys, smart wallets offer advantageous new features and provide a user experience similar to traditional financial (TradFi) service apps. Some features provided by different smart wallets include:
The functionality and advantage
No Seed Phrase
The new decade in crypto has started with a familiar problem: someone losing everything because of the complexities of managing their private key.
We founded Base to solve this, and we have. All the while being non-custodial and censorship-resistant.
Seed phrases are awful remnants of crypto’s early days. They have two huge flaws:
They leave you vulnerable. Lose it and you lose everything. Sadly all too many fall victim to this.
They’re a terrible experience. Writing a password on paper and hiding it in your house isn’t the digital future anyone wants.
Even if you don’t lose your seed phrase they’re super complicated to deal with: In short, to drive crypto adoption we need to eliminate seed phrases.
Here’s what we knew our solution had to achieve:
Fully non-custodial, i.e. Base cannot access your funds
Censorship resistant, i.e. Base cannot stop you from accessing your funds
You never need a seed phrase. This eliminates the single point of failure that undermines traditional self-custody wallets, including hardware wallets.
Multisig security
Two or more users can approve a transaction for improved security. Smart wallets can also enable multi-sig transactions to be authorized offline to save users time. Base relies on Guardians. Guardians are trusted third parties, such as friends and family, or a secondary wallet. Guardians can recover the wallet or approve a new device; approve transfers over your daily limit, and allow transfers to untrusted wallets.
Transfer limits
Daily transaction amount limit. A transaction amount limit can be set to help reduce the chance of an expensive user error and to help prevent an attacker from emptying a wallet in one transaction. Users can set transfer limits preventing hackers from emptying the wallet if it is compromised.
Whitelisting
Users can specify that transfers be made only to known addresses with a smart contract wallet. All transactions are automatically blocked unless they're to an address you trust. They allow for whatever can be programmed into them.
Bundle transitions
With a smart contract wallet, you can approve transfers to known addresses. Bundle transitions: Increasing user experience by bundling transactions with Dapps that generally have multiple steps.
Emergency account freezing
In the event of misplacing your phone, or worse, theft, a smart contract wallet can get locked, preventing funds from getting spent.
Paid gas fees
Authereum enables dApp developers to pay the gas fees for transactions that use their infrastructure, preventing users from having to maintain an ETH balance and greatly improving the transaction experience.
Trusted Guardians
Base smart wallet users, for example, can keep their accounts more secure by appointing “Guardians” to approve certain actions, such as:
Transaction amounts over a daily limit.
Transfers to addresses not included in a whitelist.
Seedless” account recovery (Guardians can unlock frozen accounts or approve new devices).
Wallet locking
You can ask a guardian to lock your wallet. The wallet can’t then make transactions. This is useful in case your phone is lost or stolen and you want to protect it beyond the phone-layer security.
When a guardian locks a wallet, a 5-day security period starts. This gives you time to get a new phone and recover your wallet. (Locking doesn’t prevent recovery, for precisely this reason).
Any guardian can unlock a wallet, including the one that originally locked it.
Simplify DeFi
By providing unique features and more familiar functionality, smart wallets enable streamlined access to decentralized protocols and apps, thereby helping to onboard a new generation of global DeFi users. Some smart wallets also integrate functionality aimed at more sophisticated users in addition to focusing on features typical consumers need.
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