How Multisigs Could Bring the Next $1B to DeFi

Transcript

and the new way to interact with financed using multi six so you've probably seen this picture floating around crypto Twitter before the decentralized violence protocol have reached 1 billion in US dollars worth of assets locked granted the last peak was mainly for price appreciating but still it's a major signal that defy has reached a product market fit and more and more users are actually willing and able to interact with these protocols so where's the next push in defy coming from I'm pretty convinced that one of the next pushes will be multi signature

walls and that's because there's currently more than 1 billion US dollar worth of assets stored in multi signature walls and those assets are not connected to to defy right now because we at Knossos are building multi signature walls we are doing a lot of user research right now trying to figure out what are the needs and and pains of multi signature users and we hear over and over again that multi signature users do actually want to interact with these protocols they want to put liquidity to uni swap to gain interest they want to stream money using Saviour they want to manage their DNS domain to do want to do all kinds of stuff but it's just very hard to do it right now so there's no easy and trusted way to

interact with t-54 multi six today and we should change that so let's talk about different multi six but first what what are multi six in so multi six is under the umbrella of smart contract walls which is generally a way to do access control schemes using smart contracts and there's really two kinds of smart contract walls out there there's smart Wallace that's for example Archon that star my wallet that's of helium and these are very much focused on personal use so they actually try to abstract away the smart contract nature the technology behind it very much so

that it's very simple and and very good user experience to their users so they use smart contracts mainly as a two to enable features and to do to keep it almost like a web to kind user experience to users then there's multi signature wallets they are more focused on high-value use so that's also often used in in like a team context also multi signature already indicating that there's all often like multiple parties involved in doing transactions using multi signature wallets and these was use smart contracts to increase security of - to store assets on the theorem so they also don't abstract away too much

of the underlying tech because use often appreciate the transparency and the control that they get and they don't want to and they want to actually know what what's happening under the hood so these stats actually show pretty well the difference between these two categories and by the way my colleague Toby is giving a talk later today where he's going much more deep into statistics of smart contract was so make sure to check that out so we have two very prominent products of each category that's argent smart wallet and that's the gnosis multisig and you can clearly see that argent is targeting more of a mass-market audience that it has already

more than five times as many users as the gnosis multisig Kingdom it has been there for for a shorter time period but the average amount of funds stored on our walls is significantly lower actually the average multi-sig user gnosis mootisse accuser stores about a thousand times as much ether as the average argent user so you can clearly see that muta sticks are more for the niche market product but the users are very much trusting it with with highs high amount of funds and yeah also coming from multi six often being used by teams and storing for example funds raised in an IC o---- so multi signature

wads have proven themselves to be the most trusted way actually to do self custody on but what we've seen in the recent years analysis is that users are uses very much trust their setup the multi-sig setup but as the market matures and they want to do actually more with their assets so they don't want to do more transactions more small contract interactions just more stuff of it you actually becomes rather a security factor so more users we're asking for better in that user experience with the gnosis multisig interface because they were doing more actions with it and

every time you do an action and the user experience isn't straight it might cause some issues and some human error in the end so that the feedback we got and we built a completely new interface at gnosis we call it gnosis safe multi-sig and we really build up the user experience around multi signature wallets from from scratch and try to make it as easy as possible today you can actually set up a multi seek within 30 seconds and then white maybe a minute to get the transaction mind but the easy part is only 30 seconds and it's it's very intuitive and easy to understand I wouldn't say that my mother would be able to set up a multisig but it's

definitely you don't need to be a developer anymore to to set up a multi-sig and and interact with it so let's back get back to defy actually that's the main way how defy works on multi six today so you put in the smart contract you want to interact with that's in this example the compound smart contract you paste the IBI that corresponds to that contract then you select the methods you want to call you define your parameters you send off the transaction and you hope that what you just did was actually what you intended to do yeah we can definitely improve on that here's also an example of how we do

situ dye migration it's a 23 step process and that's actually not me making this list it's just to make a point that's the official guide from maker how to do decide to die migration and that's not how defy should work I mean some technical knowledge of people might very well understand what they're doing and for them that this might be fine but as the market matures and and there's more use cases we should we should do something about it so we had noticed when we were building this new no safe multisig interface we also took a look at different options how we could do g5 interactions in the future so one option would be to just make what I've just

shown you this API encoding easier we could check if a smart contract is verified and if your scan and just automatically pull the IBI we could make other things to just make this feature easier but in the end it will still only be something that that very technical people would use so we are actually going to do that and we know that this is an advanced feature that many would want to have of a multi seek but that's not how the long tail of multi seek users will interact with defy in the future so another thing that that's possible is to build like a real layer application for example Aragon did that with their organ agent that could

be a Chrome extension that could be a mobile application or something that Aragon did with frame that would basically you could then go to an external web application you could do your t5 interactions there and then the application would relay these transactions back into the multi-sig or the DAO that case which would be a very scalable way to to approach t5 interactions because it would with one application would immediately be compatible with with most tabs out there however first these steps don't necessarily expect a multi-sig when when you interact with them so Multi signature words by their nature

are assumed to us so there's you could often take days until the transaction is actually executed because when there's a team behind it and you need to collect signatures it might just take that time and many tabs just expect me to mask and I expect that when then transaction is initiated that it's immediately executed so that doesn't work and also we considered this to be bad wigs just because you then have your multisig interface you have a external application and you have third-party interfaces and this entire system it's it's hard to control the user experience around that and to make it smooth then the third option we took a look at is

native integrations that's something that for example maltese malti signature wall does where you can imagine it to be like on your balance list you have a one button solution to lock your dye into compound or to open and make a wall or something like that and we could do very good UX when we do that but it's not scalable because then we know this would have to decide what are they actually exactly the the defy applications we want to integrate we would have to always stay on top of like a very dynamic market where things just can get popular overnight and that's not something that would scale over time so

we wanted to have a more broader approach here so I'm going to introduce safe apps today that's our approach to decentralized finance I'm not using and yeah you can't really see how it looks like because it's just all white on this screen but yeah basically you we wanted to turn safe multi-sig into like a platform which is community driven so that anyone every every third party developers can build their own apps into into a multi seek into the interface and basically because we analysis are our goal is to build essentially

infrastructure for a few ecosystem we want to make this really a community project so we allow anyone to build TFI applications into the motifs week so that allows us to act to be one trusted interface for our users because they already trust us with storing their funds and we wanted to have a system where they not just trust us to store the funds but also to put them to work to interact with them to to defy stuff yeah so what we had to make sure to make this happen is separation of concerns so we wanted to make sure that we defined clearly what these apps

can do and where there might be security relevant things going on where then we would be like a trusted layer between the apps and anti users so that looks like that this is the part where the third-party developers can actually do whatever they want they can design the entire experience for users they can yep these apps actually live outside of our own code base meaning that they can do whatever they want and this is just loaded with in an iframe so yeah full control over over this part but whenever

there's some something security irrelevant going on so say the app initiating transaction then this will go why us so we would display to the user what this app wants to do so the user just basically has to trust one interface and know that whatever is displayed by by us in this case is actually what's going to happen with their funds yeah the what we then need to make sure too is to create transparency because because whether I've just shown you is not very transparent to the user it's just a bunch of cryptic cryptic gibberish and we need to make sure that

we the user actually knows what consequences their actions have so that's going to similar direction how meet the mask soft approvals so so that's how it looked like in meta masks while ago the user is scared by that he doesn't know what what this is when what he's actually confirming yeah what they did is they made it clear they made it more transparent they educated the user more on what consequences they actually actions actually have and we need to do something similar something

similar using safe apps so let me display this app into action we would then invest into decoding these interactions and showing to the user clearly what what these safe apps want to do with their funds so that could look something like this you invest I into compound and that definitely creates more trust than the one on the left and we can also show to the user if the safe app wants to do some transactions where we're not really sure what they do and where he might want to take a deeper look into the transaction so we can also warn the user if there's something that's that's suspicious so then our goal is really to

to be this most trusted interface to not just or funds but also to put them to work and and manage them and yeah that's that's going to be a long way and we are this is the first time we're we're introducing this project and we're also happy to get feedback on on what you think as a user or also as a developer but let's go into how we actually build so we analysis will provide a few building blocks for for for party developers to create a safe apps that's first safe SDK that allows basically because these apps are externally hosted

they need to have some way to communicate with the multisig so this safe app SDK helps to facilitate this communication and yeah that's something we're going to build and then the uikit we will provide reusable components and UI guidelines for for developers to make it easy to create these native experiences within the multisig but still have the chance to to optimize it to their own branding and to really customize the UI and thirdly we are building a developer portal which is really going to be the one-stop solution for anyone that that once you get

started on safe apps and to when they have questions we have a forum built in so they can ask questions and exchange ideas so on so integrating safe apps when you've built them is actually as easy as opening a URL on the browser so these apps either are deployed in ipfs or are hosted on on an external website and then what the user does is just take the ipfs hash or the URL and use that within the safe multisig interface to load these external apps and we of course also want to have wise for our users to discover these apps to discover a cool use cases so we will also have

more curated ways for for people to find these but then we probably would require these apps to be actually live on on ipfs so we can make sure that the security behind it is straight all right so in my we'd sigh perhaps is really the best way to build defy apps today because you're tapping into an existing user base these users are already on board you don't need to worry about them having crypt or not I'm having a wallet or not so there are already existing crypto users and they're actually high value users so I've shown you before this just a lot of fun stored on multi

six so if Melissa called millions of US dollars of in digital assets and they we clearly see the need of these users to to connect them to defy and yeah so you get this high-value audience like from from the gecko and you can also expect that every user has a smart contract wallet because every safe multisig is a smart contract wallet under the hood and then you can leverage the capabilities of the smart contract worlds meaning you can build with with multi send you can use batch transactions to make the user experience of your apps a lot better and you don't have to ask users five six times to sign

a transaction to do more complex defy interactions so that's the timeline we are we have been starting now to build the framework you run to safe safe apps and to build our own example apps just to get a feeling ourselves how this looks like and what developers need to make these apps work and we now started reaching out to a bunch of companies and a dependable build first first external apps and to get feedback on the developer tooling and build up this developer tooling and then going into summer we're trying to push more on like completely third-party

applications where we you can expect us to be present on hackathons and we are also going to in tackle this complex task of transaction decoding and trying to make it as transparent as possible to users to interact with these these apps so that was mostly it for for the safe app sparked some quick product announcements for the safe multi-sig we so far it was only possible to to use a web app for the safe multisig or yeah clone the project on github but we are also building a desktop app so you can download it and use it on on Mac OS or

Windows then we have native card wallet support so today you could already use your your lat Tresor using meta mask but especially for for people that don't trust me to mask or that just don't want to have this like additional layer in between their hardware wallet and their multi-sig this one wasn't really convenient so we are building very native integrations for four ledger entries or so you can just plug in your your device using your USB and then connect to the Buddhistic ideally with the desktop app and then finally you can also store your c720 one on your safe multi six so you can have

you can manage your en s domains you can have your high-value digital art pieces on there or for example if we are going to use it for for yeah for for having tapcon tech or for distributing tapcon tickets as enough cheese and yeah that also opens more use cases for the safe multisig and the special with these safe apps coming along yeah probably like a crypto kiddies safe app won't be the ideal use case because the audience is more high net-worth these these are not consumers but though there's we can see an FPS being very high value assets as well so that's also going to be

interesting and all of these free things that I just announced will be live within the next two weeks so yeah and a lot more coming later this year so that was it if you're interested in building safe apps make sure to get in touch and yeah we as I said we have a talk of Toby later today around like smart contract use instead like very deep dive statistics on how different smart contracts are being used and we're also having another safe related talk of which richard Meisner who's going to talk about safe proxy kit and a way to another tooling for developers to make

taps better yeah that was it thank you have any questions I'll be around for questions later if you is there any chance the desktop app will also work for Linux definitely any more questions thank you