Crypto Safe Sheet

What is the Safe (formerly Gnosis Safe)?

Safe is a decentralized digital asset management platform that secures funds through smart accounts. Initially known as Gnosis Safe, the project aims to provide enhanced security for crypto transactions through an architecture based on multi-signature smart contracts. This technology is particularly popular with DAOs (Decentralized Autonomous Organizations), DeFi companies,  and retail investors looking for a secure solution to protect their online assets.

 

Unlike traditional wallets like MetaMask, Safe works through programmable and secure “smart accounts”. This architecture allows multiple signers to be assigned to an account to approve transactions, a concept called multi-signature (multisig). Through this model, Safe protects user funds from unauthorized access while facilitating flexible and decentralized cash management.

Vision and Mission

The Safe project  aims to transform the way users, businesses, and organizations secure their digital assets. Its mission is to set a standard for decentralized security for crypto transactions. By integrating features such as payment of fees in ERC-20 tokens, account recovery and account modularity, Safe meets the security needs of all types of users, from individuals to large enterprises.

In addition, the platform takes a community-based approach with the SafeDAO, ensuring decentralized governance where users can participate directly in the evolution of the project. By investing in solutions such as Safe Apps, Safe continues to strengthen its position as an essential tool for Web3 infrastructure.

Evolution of the project

Since its inception in 2017 as Gnosis Safe, the project has seen a notable expansion from a simple multi-signature portfolio management application to a critical infrastructure for the DeFi and DAO ecosystems. In 2022, Safe entered a new phase by becoming an independent project with the creation of the Safe Ecosystem Foundation and introducing the SafeDAO. This governance model allowed the community to participate in strategic decisions, thus strengthening the decentralization and adoption of the project.

In short, Safe stands out for its commitment to community safety and its role in the evolution of decentralized digital asset management.

Project history and context

Origins of Gnosis Safe

The Safe project  was born as Gnosis Safe in 2017, with the aim of securing the management of digital assets via multisignature wallets. Initially designed by the Gnosis team, this protocol was aimed at organizations requiring high security for the management of their cash flows. Gnosis Safe has enabled companies and DAOs to  set up accounts that require multiple signatures to validate a transaction, protecting funds from human error or unauthorized access.

Initial innovations

From the beginning, Gnosis Safe has stood out thanks to innovative features. The project introduced counterfactual deployment, a technology that allows a portfolio to be created only when it receives assets. This makes the account creation process smoother and reduces the upfront cost for the user. Safe has also pioneered batching, which allows multiple operations to be combined into a single transaction, reducing gas fees and simplifying the user experience.

The introduction of meta-transactions made it possible to pay transaction fees in ERC-20 tokens, eliminating the need to own ETH for each operation. Gnosis Safe has also offered account recovery options via multi-factor authentication and browser extensions. These innovations marked a turning point, providing users with an asset management solution that is both secure and modular.

Transition to SafeDAO and Safe Ecosystem Foundation

In 2022, the Gnosis team decided to turn Gnosis Safe into a standalone project by creating the Safe Ecosystem Foundation and launching the SafeDAO. This transition was intended to give more control to the community by introducing decentralized governance where users could vote on strategic decisions, such as resource allocation and the development of new features. The SAFE token allows holders to actively participate in this governance, strengthening the community engagement and decentralization vision of the project.

With these developments, Safe has become much more than just a multi-signature wallet: it is now an essential infrastructure for DAOs and DeFi applications, securing billions in assets. This community governance and innovative architecture positions Safe as a cornerstone of the Web3 ecosystem.

Safe Features and Functionality

Multi-signature security

One of Safe’s key strengths  is its multi-signature (multisig) security, which allows users to set up accounts that require multiple signatures to validate transactions. Unlike traditional external accounts controlled by a single private key,  Safe’s smart accounts are programmable smart contracts. These accounts can be configured to require multiple approvals before a transaction is executed, which is particularly suitable for DAOs, enterprises, and individuals looking for enhanced security.

Safe allows you to customize the number of signers required, minimizing the risk of unauthorized access. For example, a DAO can set a threshold of 3 out of 5 signatures to validate important transactions, ensuring that assets are protected even if a key is compromised. This flexibility makes Safe a go-to solution for decentralized financial institutions and large organizations.

Multi-chain compatibility

Safe is compatible with many Ethereum Virtual Machine (EVM) networks, including Ethereum, Polygon, Arbitrum, Optimism,  and zkSync, providing users with a multi-chain solution for managing their digital assets. This interoperability allows users to manage funds on different networks within a single interface. By integrating Layer 2 solutions, Safe optimizes transaction costs and efficiency, a critical feature in the burgeoning DeFi ecosystem  .

Integration with Safe Apps

The Safe Apps interface  allows users to directly access a wide range of decentralized applications (dApps) from the Safe wallet, including popular platforms like Uniswap and AAVE. This integration eliminates the need to switch between different applications and improves the user experience. Safe Apps is designed to work seamlessly with DeFi and NFT apps, allowing users to manage their funds and transact securely from a single space.

Management without gas fees

Safe incorporates meta-transactions, allowing users to pay transaction fees in ERC-20 tokens, a convenient option for those who don’t hold ETH. With this feature, fees can be covered by “relays” or paid in compatible tokens, simplifying access for new users. In addition, Safe offers  transaction batching, which allows multiple operations to be performed in a single transaction. This reduces gas fees and improves the efficiency of interactions on the blockchain, an advantage that is especially useful for regular users.

With these features, Safe meets the varied needs of a wide range of users, from individuals to large organizations, by offering them a secure and flexible solution for managing their digital assets.

SafeDAO Decentralized Governance

How SafeDAO Works

SafeDAO is the decentralized governance entity that manages the Safe ecosystem. Its role is to enable users and contributors to take part in strategic decisions through a decentralized governance model. The $SAFE token gives holders voting rights, allowing them to participate in discussions regarding the evolution of the project, such as technical updates, fund allocation, and the addition of new features. Users can vote directly or delegate their voting power to other members, simplifying decision-making while ensuring transparent management.

SafeDAO has also put in place mechanisms to strengthen governance fairness, including eliminating “Sybil hunters,” those actors who create multiple accounts to get airdrops without the intention of actually participating in governance. By strengthening these controls, SafeDAO ensures that only active and engaged users play a role in decisions.

Distribution of tokens and tokenomics

The $SAFE token is at the heart of SafeDAO’s governance and has been designed to align the interests of users, contributors, and project partners. The distribution of the tokens is structured to include all of Safe’s stakeholders. Currently, 40% of the tokens are allocated to SafeDAO’s treasury to fund future projects, while 15% is allocated to GnosisDAO’s treasury. In addition, 15% is reserved for core contributors to ensure continued involvement of developers and key players in the evolution of Safe. This distribution model reinforces decentralization and ensures that the interests of the community are prioritized.

Active users also benefit from a direct allocation of tokens, to encourage their engagement with the platform. These allowances are scheduled to be spread over several years, ensuring a gradual distribution until 2030. This vesting schedule provides stability to the project and prevents excessive price swings related to a massive release of tokens. By establishing a clear and sustainable distribution structure, SafeDAO ensures the continued involvement of its stakeholders while maintaining economic stability for the project.

Community participation and decentralization

SafeDAO encourages community participation by holding regular votes and discussions to set the project’s priorities and strategic directions. Token holders can propose changes and participate in decisions on critical topics, such as technical updates and contract security. This governance model allows Safe to remain aligned with the expectations and needs of its users, thus strengthening its positioning as a security infrastructure in the Web3 ecosystem.

With an open and fair governance model, SafeDAO puts the community at the center of its development. Through a balanced distribution of tokens and an inclusive participation platform, SafeDAO is evolving Safe towards a decentralized governance that is built on collective engagement and innovation.

Partnerships and ecosystem expansion

Strategic Alliances

To support its growth, Safe has developed strategic partnerships with major players in the blockchain sector, particularly within the Web3 ecosystem. Safe works closely with GnosisDAO, the organization that originally funded and developed Safe before it was transformed into a standalone project. GnosisDAO remains an active contributor, participating in Safe’s governance and security through its dedicated treasury in $SAFE tokens. Other notable partners include Karpatkey and Coinshift, which use Safe for advanced cash management solutions for DAOs, as well as the Zodiac module  for the integration of governance tools.

Safe is also expanding its ecosystem by integrating new solutions and tools to make it easier to secure and manage digital assets. For example, SafeSnap, an add-on, allows DAOs to delegate the governance of their treasury and set up secure votes based on smart contracts. Safe continues to explore collaborations with other Web3 players to enrich its functionality and increase adoption among enterprises and decentralized organizations.

Recent Developments and Expansions

Safe has recently expanded its ecosystem by opening up to additional networks, including second-tier (Layer 2) layers like Optimism and zkSync, to improve speed and reduce transaction fees. This multi-chain expansion is crucial to attracting a diverse user base, especially those in DeFi looking for cheaper and faster transactions. Safe also aims to make its services available on other EVM-compatible blockchains, such as Polygon and Avalanche, ensuring increased interoperability and extensive access to its infrastructure

Safe has continuously improved its offering with new features and a more intuitive interface for users. Its Safe Apps module  now allows users to directly access more than 130 dApps from their Safe account, making it easier to interact with popular services like Uniswap or AAVE. This integration eliminates the need to constantly connect external wallets, simplifying interactions with applications in the DeFi ecosystem while increasing security

Ongoing innovations

Safe continues to develop new solutions to expand its offering and meet the needs of its users. Currently, Safe is working on asset insurance modules and social recovery options, in collaboration with blockchain security partners. Additionally, the project explores solutions to simplify user access to NFTs and stablecoins within their Safe interface, creating a comprehensive and intuitive asset management environment. By strengthening its capabilities and collaborating with leading players, Safe aims to become the asset management and security standard for the entire Web3 ecosystem

Thanks to a strong partnership strategy and continuous expansion of its features, Safe is now recognized as a key infrastructure in decentralized finance and for DAOs, supported by a committed community and contributors.

Market use cases and outlook

Adoption by DAOs and DeFi

Safe has established itself as an indispensable tool for DAOs and decentralized finance (DeFi) applications, securing collective funds and facilitating the transparent management of community treasuries. With its multi-signature security and intuitive interface, Safe enables decentralized autonomous organizations to coordinate their financial decisions in a secure and democratic way. This is because every member of a DAO can be added as a signer, ensuring that important transactions require multiple approvals before they can be executed. This approach reduces the risk of theft or mismanagement and increases transparency within communities.

In DeFi, Safe is widely used by exchanges and lending platforms, such as Uniswap and AAVE, to ensure secure management of funds. By connecting these platforms to Safe Apps, users can interact with DeFi applications while benefiting from Safe’s multi-signature security. These integrations, which are increasingly sought after in the DeFi sector, illustrate the growing importance of Safe as a secure infrastructure for decentralized financial players.

Market Potential and Future Goals

Safe is pursuing growth ambitions to become the standard for asset management and security in the Web3 ecosystem. The project aims to attract new categories of users, including institutional investors, large corporations,  and NFT artists. By offering advanced security and multi-chain compatibility, Safe positions itself as an asset management solution for institutions looking to integrate blockchain into their operations. Safe is also working on expanding its infrastructure for second-tier (Layer 2) and exploring new integrations with stablecoins and non-fungible assets (NFTs), allowing users to manage their portfolios more flexibly and cost-effectively.

The project also includes continuous improvements to its account recovery features  and decentralized security solutions, to ensure an optimal user experience. Safe explores insurance options for assets, building user confidence in the platform’s security.

Challenges and opportunities

While Safe has managed to position itself as a key infrastructure, the project faces challenges related to the complexity of setting up multi-signature wallets and the need to educate users on its advanced features. To overcome these obstacles, Safe plans to intensify its educational efforts and simplify its interface to make it easier for new users to access.

In conclusion, Safe sits at the crossroads between technical innovation and community governance, with plenty of opportunities for expansion in the DeFi and DAO market. Its decentralized security and management model continues to place it as the preferred choice for users looking to secure their assets in the Web3 universe.

FAQs about the Safe

What is Safe (formerly Gnosis Safe)?

Safe, formerly known as Gnosis Safe, is a decentralized asset management protocol based on smart accounts and multi-signature contracts. It allows individuals, businesses, and DAOs to secure their digital assets with a setup that requires multiple approvals before validating a transaction. Safe is compatible with various EVM networks  like Ethereum, Arbitrum, and Polygon, and is an essential tool for users looking for advanced security for their Web3 transactions.

How does Safe’s multi-signature security work?

Safe’s multi-signature security allows users to configure a threshold of approvals to validate a transaction. For example, a wallet may require 3 out of 5 signatures to authorize an expense, ensuring collaborative and secure management of funds. This mechanism is particularly useful for organizations that want to avoid the risk of unauthorized access or malicious transactions, as multiple parties must give their approval before any operation can be performed.

What are the main benefits of Safe for DAOs and DeFi projects?

Safe is widely used by DAOs and decentralized finance (DeFi) projects  thanks to its advanced security options and integration with decentralized applications. For DAOs, Safe provides full transparency in the management of community funds, allowing multiple members to validate transactions. For DeFi projects, Safe ensures interoperability with many dApps, simplifying interaction with services like Uniswap or AAVE, while ensuring multi-signature transaction security.

What is SafeDAO and how does SafeDAO’s governance work?

SafeDAO is the decentralized autonomous organization that manages Safe’s governance. Holders of the $SAFE token can participate in important project decisions, such as resource allocation or security updates. Votes are made directly or by delegation, ensuring transparent community management and alignment of goals between users and developers. This decentralized governance model allows Safe to remain adaptable and in tune with the needs of its community.

How do I create an account on Safe and what security options are available?

To create a Safe account, users need to connect a wallet like MetaMask or Coinbase Wallet and select a multi-signature approval threshold. Once the account is set up, users can choose to add additional signers and use hardware wallets like Ledger or Trezor for advanced security. Safe also offers transaction simulation options, allowing users to view costs and results before posting transactions.

Which blockchain networks are compatible with Safe?

Safe is compatible with many Ethereum Virtual Machine (EVM) networks, including Ethereum, Arbitrum, Optimism, Polygon, and zkSync. This multi-chain compatibility allows users to manage their funds across different networks while benefiting from Safe’s security and features. This interoperability makes it easier to access DeFi solutions and improves transaction efficiency for users, especially those active on multiple blockchains.

What features are available in Safe Apps?

Safe Apps is a built-in feature that allows users to directly access more than 130 dApps from their Safe interface. They can interact with decentralized finance platforms like Uniswap, AAVE, or NFT management tools without leaving the Safe interface. Safe Apps thus provides a smooth and secure user experience, without having to constantly connect external wallets, which improves the security of transactions.