Enhancing SAFEs for Web3 Builders
Trusted by Web3 teams both small and large, SAFE, formerly known as Gnosis Safe, is considered the industry standard. $47 billion worth of digital assets are currently held within SAFEs across blockchains, and 1% of transactions on these chains interact with the wallet’s smart contract. In this blog, we’ll delve into the world of SAFE and explore what makes it an essential tool for builders. It has not only survived market cycles but thrived, showing no signs of slowing down. We’ll uncover some of the factors behind this success and why it is seen as an indispensable tool for any Web3 team Finally, we will show you how to get even more out of your company SAFEs by taking them to the next level with Koshance.
The Essentials of SAFE
The secure storage of funds can have a make-or-break say in a company’s future. Ownership of these digital assets is shared, and therefore so should be consent for any transactions. Sharing private keys is simply not an option, since each instance of sharing adds to the risk of compromising funds. Multi-signature wallets are an ideal solution for blockchain builders due to their unique traits.
They enable the
Safeguarding a team’s funds
Collaborative management of these funds, and
Paper trails that enable shared accountability
Multi-signature wallets achieve this security by requiring a pre-determined number of approvals in order to confirm an outgoing transaction. This multiple-owner system removes the single point of failure seen in private keys and seed phrases. Every owner has an equal say in the process, providing enhanced security through collaborative management of funds. SAFE leaves thorough paper trails, including the accounts that have approved transactions.
Creating a SAFE is a straightforward process, involving just two steps. First, you designate the accounts that will serve as owners. The term ‘owner’ is used to identify a participant who is responsible for signing the transaction - this can be devices, individuals or a combination of both. Then, you set a signature threshold for transactions. For example, sending a transaction might require approval from 2 out of 3 owners. The idea here is that a single key or password is no longer the sole means of using funds, and the consent of owner accounts becomes a part of the approval process. Transaction thresholds and signers can be altered, provided the group can agree on the changes. This flexibility makes it easy to adapt SAFEs to the needs of a growing organisation.
Blockchains achieve security through transparency - all accounts, transactions and balances can be publicly viewed. Being a smart contract built on top of this infrastructure, SAFE shares many of these traits and makes the signing process transparent as well. Knowing which owners have approved transactions can help ensure accountability. The cost of this transparency, however, is the increased transaction fees. Smart contract interactions are more expensive than standard transactions, so during times of network congestion, these fees can skyrocket.
What Makes SAFE an Important Tool for Web3 Builders?
Put simply, SAFE is very easy to use and delivers on its primary use case extremely well. Like on most multi-sig wallets, funds held in SAFEs are much more secure than any guarded by only a seed phrase or password. Users retain control over all assets in their SAFEs, and do not need to entrust external parties with custody of their funds. The self-custody of SAFE, combined with the difficulty in compromising multiple accounts, makes these wallets a less attractive target for would-be attackers. Any instances of a SAFE being compromised lie in human error, rather than a failure of the protocol.
Then come the operational requirements for flexibility, and this goes beyond making alterations to owners and thresholds. SAFEs can hold assets from multiple blockchain that is EVM-compatible, and this includes Polygon, BNB Smart Chain, and Arbitrum. DApps such as decentralised exchanges can be used through the secure guardrails of SAFEs.
The final, vital, distinguishing aspect of SAFE is its open-source development. The community is actively involved in testing and improving the platform, embodying the Web3 ideals of open participation. The “don’t trust, verify” attitude defines the digital asset space, and SAFE is no different. To take the security aspects up another level, SAFE is also rigorously audited by third parties. This is a crucial aspect considering developers are invited to build on SAFE as part of its growing ecosystem. Solid foundations can go a long way towards establishing confidence for users and builders alike.
Elevate your SAFE with Koshance
Put simply, SAFE is great and we want to make it even better. We have spoken to Web3 entrepreneurs and founders all over the world to learn what works for them, and what can improve their specific workflows. Koshance is packed with quality-of-life upgrades that are designed to complement your experience of building with SAFEs.
Companies will have multiple SAFEs and accounts across their operations, and this includes SAFEs on other blockchains. Knowing where the company funds are stored is a vital first step for many business decisions, and the Koshance Unified View is an ideal starting point. From a single dashboard, monitor all your assets including those stored in SAFEs.
The organizational-wide address book complements the Unified View in many ways. In addition to giving much-needed context when reviewing your transactions, you can save time and reduce the chances of errors in future transactions. Easily view and sort recipients by name, and make your digital asset financial statements more human-readable.
The next (and most highly-requested) quality-of-life feature for your SAFE is notifications. Unlike Web2 applications that almost give us too many notifications, the lack of action-based alerts within SAFE is a recurring issue for blockchain builders. Transactions will only be executed if the signing threshold has been met, leading to idle time if signers are not active and online. Expediting the process often requires follow-ups on Telegram or other messaging apps. Koshance’s notification system is designed to save time and make following up with signers a thing of the past. Send alerts wherever your team collaborates, whether that is via email or Slack.
In a company’s early days, founders are involved in every aspect of operations to ensure their vision is realised. Once the team reaches a certain size this is simply not possible, and delegation is a must. Koshance replicates this need for flexibility in delegation and user roles for your SAFEs. The number of owners and the signature thresholds in our SAFEs currently determine how we can delegate transactions. Only owners can initiate transactions, and other owners have to approve. Koshance enables any approved individuals to initiate, but not authorise, transactions. Final approvals remain the responsibility of the owners. This can work similarly to members of your financial team writing all the details in a cheque - i.e. the recipient and amount - and giving you the final sign-off. Additional members who are brought into the system have neither signing rights nor ownership, but can help reduce the workload of the founders. This enables the scope of participation to grow from a group of pre-approved owners to an organisation-wide set of policies.
While SAFE offers batch transactions, business operators are always looking for ways to optimise further. Those who have used SAFE acknowledge that it takes significant technical know-how to use the batch transfer functions effectively. The accounts teams in many organisations often have more experience in traditional finance than Web3, so we need to ensure that tools are intuitive and easy to use. Especially when considering the sums involved, there is little room for error. Koshance simplifies the process of sending batched transactions. Releasing vendor payments, monthly payroll and influencer payouts can be as easy as a drag & drop.
Conclusion
SAFE has enabled shared ownership and consent to become a central part of the building process. The next step is refinement, where you can elevate the capabilities of your multi-sig wallets. Use your existing SAFEs with Koshance to optimise, automate and simplify your workflows. Building happens across many SAFEs and blockchains, and Koshance brings all your vital information into a single place. Our mission is to streamline your journey as a Web3 builder, visit our website to learn more. Join the conversation on X, where our DMs are always open to builders and enthusiasts alike.