What is a Smart Contract Wallet? 5 Epic Benefits

As the world of DeFi continues to evolve, the demand for more secure and versatile wallet solutions is on the rise. This demand has led to the emergence of a new generation of crypto wallets known as smart contract wallets. These advanced wallets are revolutionizing the crypto landscape by offering enhanced security and user-friendly features, maintaining self-custody and decentralization, unlike centralized exchanges.

This article delves into the advanced capabilities of smart wallets and outlines how they differ from traditional wallets like MetaMask.

What is a Smart Contract Wallet? A Simplified Definition

A smart wallet is a type of cryptocurrency wallet designed to offer superior security and user experience compared to traditional wallets like MetaMask. It consists of two main components: the application and an account smart contract. These wallets empower users to batch multiple transactions into one, transform their smartphones into advanced hardware wallets, and pay gas fees using various tokens besides ETH.

Is MetaMask a smart wallet? No, MetaMask is not. It operates as an externally owned account (EOA).

Is TrustWallet a smart wallet? No, TrustWallet, like MetaMask, is also an EOA.

So, what are some examples of smart wallets? One notable example is Braavos. Let’s explore the unique benefits and features these advanced wallets offer.

Key Features of Smart Contract Wallets

Multicalls

Users can bundle multiple calls into a single transaction, simplifying the process and making it more efficient and secure.

For example, users no longer have to give unlimited approval to dApps to access their account to perform transactions (like AMMs that need an ‘approve’ transaction before a Swap). The ‘approve’ call is bundled into the same transaction as the actual operation the user wants to do (e.g. Swap). The transactions are faster and more straightforward. As a consequence, the overall user experience is better.

Hardware Signer

Wallets that support account abstraction, as outlined in ERC-4337, pave the way for custom signature verification schemes. These schemes enable the integration of mobile-based HSM security (secp256r1 / NIST-P256) directly into the blockchain for verification.

Braavos introduces true 2FA (two-factor authentication) in the crypto world through this innovative approach. By combining “something you have” (a physical token or device) and “something you are” (a biometric identifier), Braavos greatly enhances security.

Multi-Signer

Users can add a signer from a different device with the Multi-Signer feature. It offers 3FA (three-factor authentication) – something you know, something you have, and something you are.

In the Braavos Wallet, users sign transactions with the Braavos Chrome extension in conjunction with their Android or iOS mobile device. This ensures that users execute transactions only after they have been signed by both the extension (using the key derived from the seed phrase) and the mobile device (employing the Hardware Signer).

By adding this extra layer of security, users further safeguard their transactions and assets. 

Daily Withdraw Limit

Smart Contract Wallets offer users the ability to set a daily withdrawal limit. It restricts the amount that can be spent in a single day. If a user attempts to spend beyond their daily allowance, the transaction may either be blocked or require 2FA or 3FA verification, depending on the user’s preferred security level.

This feature not only adds an extra layer of account management and protection but also promotes more conscious spending habits. Moreover, potential attackers can’t drain an entire account instantly if they manage to compromise just one of the user’s authentication mechanisms.

Paymaster

You might have experienced the inconvenience of wanting to perform a transaction but not having enough ETH to cover the gas fees. In such cases, users need to go through the process of depositing ETH into their account from an external source.

The Paymaster feature enables users to pay gas fees using any supported token. This added flexibility and convenience allow users to avoid the hassle of depositing or on-ramping additional ETH solely for gas fees. It streamlines the transaction process and makes it more user-friendly.

Enhanced User Experience and Security

Smart wallets leverage smart contracts to offer functionalities that were previously unattainable with EOAs like MetaMask. Here are some additional features that set these advanced wallets apart:

• Recovery Mechanisms: Unlike traditional wallets, which rely on seed phrases that can be easily lost or stolen, smart wallets often include social recovery options. Trusted individuals can help restore access to the wallet, adding another layer of security.

• Automated Transactions: Users can set up recurring payments or automated investments, enabling more streamlined and hands-off management of their digital assets.

• Decentralized Applications (dApps) Integration: Smart wallets can seamlessly integrate with various dApps, providing users with a more cohesive and efficient experience when interacting with DeFi platforms.

Braavos: Pioneering the Future of Smart Wallets

Braavos is a prime example of a smart wallet that is pushing the boundaries of what is possible in the crypto space. Operating on Starknet, an Ethereum Layer 2 scaling solution, Braavos offers low fees and native account abstraction, significantly enhancing the user experience.

Unlike MetaMask and other traditional wallets not supported on Starknet, Braavos leverages this technology to provide a more streamlined and secure interaction with the blockchain. By continuously innovating, Braavos is shaping the future of decentralized finance and making it more accessible to a broader audience.

The Road Ahead for Smart Wallets

As the crypto world continues to grow, smart wallets are expected to gain traction quickly. They address many of the pain points associated with traditional wallets, such as complex security setups and the need for multiple transactions. These wallets are designed to provide users with a simpler, more secure way to manage their digital assets, making them a key player in driving mass adoption of blockchain technology.

Ready to explore the future of crypto wallets? Download the Braavos Wallet on your preferred browser or mobile device today and experience the next generation of secure and user-friendly digital asset management.