- Home
- /How to Send & Receive Crypto with Coinbase Smart Wallet
How to Send & Receive Crypto with Coinbase Smart Wallet
Coinbase is encouraging onchain app developers to integrate smart wallets into their applications to streamline the onboarding process.
Author by
Pedro Augusto
Coinbase has introduced a revolutionary new product, smart wallets, marking the next evolution of self-custodial wallets.
This development is aimed at addressing key challenges in the cryptocurrency space, such as complex onboarding processes, prohibitive network fees, and the cumbersome use of recovery phrases.
What is Coinbase Smart Wallet?
Coinbase has recently unveiled the next evolution in self-custodial wallets, marking a significant advancement in its quest to onboard more than 1 billion users into the onchain environment.
These smart wallets aim to resolve the most prominent challenges in the cryptocurrency user experience, such as complex onboarding processes, prohibitive network fees, and the cumbersome management of recovery phrases, thereby facilitating a smoother transition to onchain activities.
The newly launched coinbase smart wallets are designed to offer a streamlined and gas-free onchain experience. This user-friendly approach is supported by multi-chain compatibility and integration with major applications, significantly simplifying the process of transitioning to blockchain technology.
Previously, users faced slow and costly onboarding, which often involved downloading separate wallet applications and navigating the complexities of first-generation blockchains. However, smart wallets eliminate these barriers by leveraging ease of use and next-generation Layer 2 networks like Base, thus setting the stage for increased onchain adoption.
How Does It Work?
Smart wallets allow users to quickly create a free, secure, self-custody wallet. They streamline the onboarding process by reducing the number of transactions that need to be signed and allowing users to seamlessly use their Coinbase balances onchain.
This means no more funding wallets for gas fees or struggling with compatibility between different applications. With smart wallets, users can mint NFTs, trade on decentralized exchanges, or explore DeFi applications with just a few clicks, all while maintaining security and self-custody of their assets.
One of the key features of smart wallets is their effortless onboarding capability. Users can create a new wallet and begin using it within seconds, without the need for additional apps, extensions, or recovery phrases. Authentication methods such as Face ID, Google Chrome profiles, fingerprints, or YubiKeys enable instant access.
Furthermore, smart wallets simplify onchain payments, allowing users to pay with their self-custodial wallet balance or their Coinbase account balances, effectively eliminating common “insufficient balance” errors. They also offer cross-app portability, enabling users to carry their wallet, identity, and balances across thousands of popular onchain applications.
Another significant advantage is the ability for developers to provide gasless experiences through paymaster integrations, which sponsor transactions for their customers. Additionally, Coinbase offers a companion web application that includes comprehensive features such as asset and identity management, transaction capabilities, and support for NFTs, which will serve as the primary management platform for smart wallet users.
Upon launch, smart wallets are compatible with most leading onchain applications and support eight networks including Base, Ethereum, Optimism, Arbitrum, Polygon, Avalanche, BNB, and Zora, with plans to expand this support in the future.
Sign in and Login Steps
To begin, prospective users should set up a Coinbase account. There are two account types available, catering to different user needs. The “Individual” account is ideal for those interested in trading, sending, and receiving cryptocurrencies, and it also offers price alerts and other services. The “Business” account is suited for businesses and high-net-worth individuals who need additional services such as cryptocurrency custody, acceptance, and trading.
Setting up an account involves a quick visit to Coinbase, widely regarded as the most trusted cryptocurrency exchange globally. The registration process can be completed in under a minute. It is crucial for users to provide their personal details precisely as they appear on their government-issued ID, including their first and last names. An email address is also required, and all mandatory fields are marked with an asterisk (*).
For enhanced security, users are encouraged to register a mobile phone number with their account and set up two-factor authentication. This additional security measure helps safeguard the user’s investments and transactions.
Furthermore, to stay updated on the official launch of the Smart Wallet and other pertinent updates, users can subscribe to the Coinfomania newsletter. This newsletter, which boasts over 10,000 subscribers, delivers weekly, data-driven insights into the cryptocurrency market and regulatory developments. Each issue provides valuable information and can be read in just eight minutes.
How to Send and Receive Cryptocurrency in Coinbase Smart Wallet
Coinbase is encouraging onchain app developers to integrate smart wallets into their applications to streamline the onboarding process. Typically, developers lose many potential users when they are required to install and fund separate wallets. Smart wallets can be accessed directly from any browser, eliminating the need for additional app or extension installations.
Key improvements include the sponsorship of gas fees, batch transactions, and the ability to spend directly from Coinbase accounts without the need for API integrations (EIP-5792). These features are expected to significantly improve conversion rates and set new industry standards.
Developers are prompted to integrate or update their SDKs to provide a superior onchain experience using smart wallets. The integration process is straightforward, requiring only a few lines of code, and smart wallets are already compatible with popular wallet libraries and aggregators such as WAGMI, Web3Modal, Privy, Dynamic, and Rainbowkit.
Additionally, developers have compelling incentives to adopt smart wallets, including eligibility for up to $15,000 in gas credits through the Base Gasless Campaign and the opportunity to win Ethereum during the Base Buildathon across eight different tracks. Furthermore, successful integrations could earn additional rewards from a bonus pool of 40 ETH.
Coinbase is currently beta testing its Smart Wallet on the testnet and expects to launch it on the mainnet within the current quarter. As the wallet has not yet been released to the general public, it is advisable for interested parties to prepare in advance to ensure they can start using the wallet as soon as it becomes available.
Pedro Augusto is a financial writer and editor fluent in Portuguese and English, specializing in finance, economics, and investments. He holds degrees in Mechanical Engineering and Financial Management. Pedro is a financial analyst for stocks, ETFs, and macroeconomics on Seeking Alpha, a seasoned translator in the Forex market for companies like OctaFX and FBS, and experienced in localizing content for the currency exchange and international remittances market, notably for the Remitly startup. Additionally, he's a skilled writer and translator in the cryptocurrency and blockchain sector, working with firms like Phemex and Coinpanda.
