Smart Contract Wallets: 10 Questions Answered By An Expert

Smart contract wallets represent a new breed of crypto wallets poised to supplant traditional ones such as MetaMask. But what makes smart contract wallets stand out? Should you consider using one? These are the questions we’ll explore in this article. You can find a keystone article on smart contract wallets here.

Q: To kick things off, can you guys tell us about your background and how you started working on Braavos?

Motty:

My background is in computer science engineering, I was what you can call a web2 entrepreneur for my entire professional career and came into crypto relatively late, about a year and a half ago.

But I was fortunate enough to have the time to dive in and understand the technology in-depth and learn about the various L1 solutions that exist out there. I realized that Ethereum has the highest chance to be the most dominant chain going forward, but it also has a scalability problem.

So I studied all the possible scaling solutions, whether it’s side chains, optimistic rollups or ZK rollups. We were amazed by the StarkNet scaling technology, so my co-founders and I decided to start building on it.

And before I continue, I will pass it down to Bertrand to introduce himself.

Bertrand:

Thank you. I have a different background because I come from the marketing side of web2. I worked on many SaaS projects before, so I did a lot of digital marketing.

But one and a half years ago, I started to get interested in the community aspect of marketing. I was already a crypto enthusiast interested in web3 and learning about various projects, but I never connected my job with crypto.

As I understood that most crypto projects need to be developed through a community approach, I dived deeper and worked on my first crypto project to get some experience building in Web3.

A few months ago, I met Motty. We had a fascinating discussion about Braavos: the project, the technology and of course the vision, which is essential to me when we want to shape a community.

We agreed on the vision and how we should drive the growth of Braavos through the community. I joined the project just over two months ago with the goal of empowering our growth with a community-led approach for Braavos.

Q: Can you briefly explain why you decided to build Braavos?

Motty:

We decided to build Braavos because the wallet experience in crypto is still not as good as we want it to be.

A fantastic piece of evidence is that 80 to 90% of the 200–300 million people that already use crypto are still using centralized solutions such as Binance, Coinbase, Kraken or Celsius (or at least used to use Celsius…)

But we cannot blame them for using centralized solutions because they give an experience much closer to web2 than everyone uses when using their everyday apps.

Meanwhile, self custodial solutions are complex, they have all these scary words like private keys and seed phrases. And the cost of error or the chance that a mistake would happen is significantly high, because you deal with long strings of numbers and characters that normal users should not deal with.

For us, this was a key aspect of what motivated us to develop Braavos because we saw how StarkNet’s technology could help migrate users from web2 and centralized crypto, which is not crypto, to a decentralized and self custodial wallet.

So that’s the reason why Braavos exists, to make crypto safe and intuitive for users.

Q: Can you tell us some differences between a smart contract and other kinds of wallet out there?

Motty:

The difference is that smart contract based wallets can really help us improve the user experience. First, let’s explain what smart contract wallets are, and then I’ll give a few examples of features that will revolutionize crypto wallets.

For self custodial wallets, you have, on one hand, client-side only wallets like Metamask, meaning you sign transactions on the client side and send them directly to the blockchain.

On the other hand, you have smart contract based wallets with a client side, which is the mobile app or the browser extension, and the smart contract side that lives on the blockchain.

Each and every one of your transactions that you sign on the client side first passes through your smart contract that represents your account on the blockchain, and from that it goes through to the different dApps that you want to communicate with.

I want to emphasize on the fact that account abstraction is a synonym to smart contract wallets. So when you hear people say “account abstraction,” which was published under EIP-4337, what they really mean is a smart contract-based wallet.

Now the fact that our wallet has a smart contract on-chain that represents the user’s account, opens up a wide design space for creating the right attributes that will improve the user experience and the security of self-custodial wallets.

Let’s give a few examples to demonstrate:

I’ll start with a simple one, multicall

So if you’re familiar with traditional wallets on Ethereum, when you interact with a certain dApp and a certain token, you first need to approve that the dApp can transfer this token from your account, and only then you can interact with the dApp.

But usually this approval to the dApp requests an unlimited amount of tokens.

Meaning you give the dApp unlimited access to your funds and you hope there won’t be any bug or hack and that the protocol withdraws from your account only the amount needed for the operation.

Of course this is a flawed UX and there were quite a few hacks in the past that utilized that.

But with smart contract based wallets, if, for example, I want to swap some tokens, I don’t need to give the exchange an allowance to transfer an unlimited amount of them. With only one transaction, I can couple the transfer allowance approval for the exact amount that I want to swap plus the swap transaction itself, so it only costs the gas fee of one transaction.

Account segmentation

A second example, which I really like, is what is called account segmentation.

It’s the fact that I can define various types of accounts within the same wallet.

Let’s say I want two distinct accounts in my wallet, a checking account and a savings account.

In my checking account, I want to be able to send transactions with no time delay, but with a daily withdrawal amount limit.

Think of that as your ATM card, there is a withdrawal limit and that’s a good thing because if my ATM card gets lost or stolen, I know that the thieves might steal from me, but they cannot empty my entire account.

As for the savings account, I have more money in there so I want it to be more secure and I won’t use it every day, so I’ll set no withdrawal limit, but I’ll set a time delay of 24/48/72 hours.

That way, to withdraw from my savings account, I’ll need to approve the transaction again 24 hours after I’ve made it, for the transaction to be confirmed and be sent on the blockchain.

With this feature, I’ll feel much safer holding my funds in my self-custody wallet

These are very simple examples of why smart contract based wallets are better, but there are of course much more, like the possibility to do trustless 2FA.

Q: What critical problems does Braavos solve that existing solutions are not solving?

Bertrand:

What I really like about Braavos is that in every part of the roadmap, we want to make crypto stress-free and nontechnical for the next wave of people that are going to join us on the DeFi journey.

In the last few months, the tech team did an important work on the UX, we got a lot of positive feedback from people who really enjoy Braavos because it’s simple to use and powerful, and of course, the features that Motty just described will help push the user experience even further.

The second point is that Braavos is the only StarkNet mobile wallet, which simplifies the DeFi experience because you can do all your big transactions from your desktop, and you can use your mobile to control simple transactions. This flexibility is important, as it makes the wallet even more user-friendly.

But also the fact that the Braavos wallet is smart contract based enhances the security aspects of both the blockchain side and the front end, where people manage their funds.

I think this is really important because it gives confidence to new users, in contrast to the stressful experience of other self-custody wallets.

And the last point is we decided to work solely on StarkNet because among all L2s, it has the most solid and most promising technology to take Ethereum and scale it to hundreds of thousands of transactions per second and really bring the crypto industry to where we think it should be.

That’s why we’re focused on StarkNet instead of trying to cover the entire crypto space, our mission is to bring the best solution possible to StarkNet.

These are the important points of what makes Braavos clearly different from what you have on the market.

Q: What partnerships between Braavos and other projects on StarkNet can we expect in 2022?

Motty:

As we are solely focused on StarkNet, we try to work closely with most of the protocols in the ecosystem.

So of course we have a strong partnership with StarkNet itself in order to continue and push the network towards the re-genesis state.

We also cooperate with NFT marketplaces that you can already access from the Braavos wallet.

We already integrated with DeFi using the mySwap exchange and we plan to include even more DeFi projects and bring them into the wallet so we can offer users a one-click swap with the best available rates.

Even more partnerships are to come, such as ENS Domain names coming to StarkNet that will be integrated into the wallet.

Q: Can you share the feature that you like best about Braavos?

Motty:

The one thing that I like very much is the Transaction Explainer.

When I came into crypto, I got all sorts of pop ups in the wallet that asked me to sign transactions and I didn’t really understand what I was signing on.

So I tried to read what it said, but in most parts it was gibberish. Even with my technical background, I could not really understand what was happening behind the scenes.

That’s why we’ve created and continuously improve on the Transaction Explainer for users to really understand what they are signing on.

I’m also excited about the ability to do both biometric and two factor authentication without the need of additional hardware when you’re using your mobile device.

We have quite a few more interesting features that we’ll expose in the future.

Q: Are there any security risks in smart contracts wallet?
Has Braavos been audited by any external parties?

Motty:

Braavos contracts have not been audited yet and the reason is twofold.

First, since we’re still in the midst of development, there are still core functionalities that we want to add to the Braavos wallet in order for that to be primetime-ready for the initial audit.

And the second thing is that StarkNet as a network has not been audited. It’s still under development and needs to go through the re-genesis process, which is very significant because it affects not only StarkNet but also its programming language, Cairo.

It makes much less sense to perform the audit now, knowing that both StarkNet and Cairo will receive quite a lot of changes under the hood. Of course, we’ll have the Braavos protocol audited as soon as the re-genesis process is in place.

It’s important for me to emphasize that we have quite the experience with StarkNet and Cairo, so we know how to rigorously test both the client side and the contract side of the wallet.

We always take security very seriously, even before audits, we understand that we deal with people’s money so we naturally take a great deal of precautions to make sure it’s safe.

Q: What is your view about crypto wallets in the future?

Motty:

I think that crypto wallets in the future will all be smart contract wallets simply because they enable a much greater experience and much better security. I think this is still one of the most underestimated points in crypto today.

And going forward, moving two or three years into the future we’ll see that the vast majority of wallets will either be smart contract based or will make the transition to be smart contract based wallets, simply because they make people’s lives easier and don’t require them to experience the constant friction and risks imposed by self-custody solutions today.

I believe this will bring more and more people into web3, as users can focus on enjoying decentralized services with the whole crypto experience being much more streamlined.

Q: How important is the community to you and how can we help you grow your project?

Bertrand:

The community has a huge importance to us, I joined Braavos because of this aspect.

When we talk about the growth of Braavos, the community is at the center of our vision. For example, how we can make Braavos as intuitive and safe for them or how we can apply the community feedbacks to drive part of our innovation

So we are not looking for a huge community in terms of numbers, but rather for the quality of the interactions.

It’s one thing to onboard users only interested in airdrops, it’s another to have a community passionate about the possibilities that StarkNet offers, who will report bugs in a detailed way and give feedback about what features they would like to have in the Braavos wallet and so on.

If you want to help improve Braavos, use the wallet with various StarkNet projects, and report your thoughts back on Discord, that can be a feature that would move forward the user experience, or maybe a bug you encountered.

So how do we get that kind of community?

One way is to work with projects to convey our vision and our love of the tech to the StarkNet community and get feedback from the ecosystem, and see how we can help other projects bring curious crypto enthusiasts into StarkNet.

Q: Does Braavos have any local communities around the world?

Bertrand:

Not yet, all of our communities are unified on the Braavos’ Discord.

But it will come soon, you will see lots of activity from our side on this, where we’ll develop what we call a micro-local community approach, but this will take a few weeks before we start the program.

I can’t tell you more about this, but there are exciting things coming for the Braavos Nation.

If you want to join the Braavos Nation and share your feedback, we encourage you to connect to our Discord, and Twitter to get in touch and catch the latest news.

You can also download the Braavos wallet on mobile for Android and iOS, and on multiple browsers: Chrome, Firefox, and more.

To sum up, what are smart contract wallets?

Smart contract wallets offer three key features that differentiate them from traditional wallets:

– Multicall: Enables token swaps in a single transaction instead of two.
– Paymaster: Allows payment of gas fees in tokens other than ETH.
– Hardware Signer: Turns your smartphone into an advanced hardware wallet.

Thanks to the StarkNet Vietnam community for the interesting interview.
They provide users with knowledge, overviews and daily updates about the StarkNet ecosystem in Vietnamese.

Check out more of what they do over here.