Safe (SAFE) History: From Multi-Signature Wallets to a Leading Smart Account Ecosystem

Bittime - Safe (SAFE) is a major player in the field smart account (smart account). Smart accounts offer better security and flexibility than traditional crypto wallets. Well, this article will discuss the history of Safe (SAFE) and how they became a major player in the smart account field.

However, Safe's journey to its current position was not instantaneous. Let's explore the history of Safe, from its humble beginnings to becoming a leader in the smart account ecosystem.

Safe (SAFE): From Gnosis Multi-Signature Wallet

Safe's story began in 2016 with Gnosis, a project founded to explore prediction markets on the Ethereum network. Gnosis needed a secure way to store the funds they raised from their initial token sale (ICO). At that time, there was no mature and suitable solution. 

As a result, Stefan George, co-founder of Gnosis, wrote the code for his own multi-signature wallet. This wallet was later released as open-source and named Gnosis Multi-signature Wallet.

The security and ease of use offered by Gnosis Multi-signature Wallet quickly attracted the interest of many parties. The wallet became the de-facto standard for multisig transactions, with over $1 billion in total assets secured in several years.

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The birth of Gnosis Safe

The Gnosis team realized the potential of smart contract-based wallets and began developing the next generation solution. Gnosis Safe was born in 2018 as a multi-purpose Smart Account.

Compared to its predecessor, Gnosis Safe offers several advantages:

• Gas Efficiency: Uses a proxy-singleton architecture that significantly optimizes gas usage.
• Modular Architecture: Allows Safe Smart Accounts to add additional features over time, without the need for users to migrate to a new account.
• Formal Verification: Gnosis Safe took over 6 months to become the first (and as far as we know, the only) Smart Account to be formally verified.

Safe Becoming Overly Advanced Mobile Wallet

Along with Gnosis Safe, the team is also developing a mobile wallet in the hope of making it easier for ordinary users to access the benefits of Smart Accounts. This wallet has features that have only recently become popular, such as:

• Counterfactual Deployment: The Gnosis Safe Proxy will only be deployed after users have actually sent assets to it, making the onboarding process smoother.
• Onboarding Without a Seed Phrase: Users can choose to create an account without a seed phrase, with the private key stored on the device. Later, users can add more secure keys that are backed up using a seed phrase.
• Batch Transactions: Gnosis Safe is the first implementation of transaction batching for wallets, providing a more efficient user experience.
• 2FA with Browser Extension or Keycard: Additional security can be gained by adding a key using a special browser extension or Keycard Status.
• Pay Gas Fees with ERC-20 Tokens: Using meta-transactions, the Gnosis Safe mobile wallet allows paying gas fees with any ERC-20 token (not just Ether) stored in the wallet.

Unfortunately, the timing of the launch of this mobile wallet is not right. At that time, DeFi (Decentralized Finance) didn't exist yet, and there were still few retail users on Ethereum. As a result, this wallet was not widely adopted and its development was stopped.

Return to Safe Roots 

After mobile wallets were less successful, the Gnosis team went back to the drawing board. A few months later, "Gnosis Safe for teams" (later changed to just "Gnosis Safe") was introduced. 

It's a new web application that follows in the footsteps of the original Gnosis Multi-signature Wallet, but builds on the new Smart Account Safe.

While still targeting teams, not individuals, the new smart contracts allow the product to reach new user groups due to its better UX features and lower gas fees. 

This new solution found market fit in just a few months, and even CEX (Centralized Exchange) Bitfinex started using Gnosis Safe for cold storage of their customers' assets.

In less than a year, more than $1 billion in assets were moved to Safe Smart Accounts. This shows increasing trust in Safe smart contracts as time goes by.

Safe Become Critical Infrastructure

In 2021, Gnosis itself transitioned into a DAO (Decentralized Autonomous Organization) which was named GnosisDAO. Safe itself is experiencing continued adoption growth. 

The initial focus will be on user groups that will benefit most from the added security and modularity Safe Smart Account. This shows increasing trust in Safe smart contracts as time goes by.

Specifically due to its modular architecture, Gnosis Safe was also a major actor in the DAO ecosystem boom that began in 2020. Innovations like SafeSnap allow founding teams to hand over account control (admin/treasurer keys) to the community, enabling progressive decentralization.

To date, most DAO treasurers operate on Safe, and a number of sophisticated treasurer management teams (Karpatkey) and tools (Zodiac Module, Coinshift) have emerged, creating further network effects.

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Safe Become Critical Infrastructure

In 2021, Gnosis Safe also took significant steps towards interoperability and scalability with switch to multi-chain. This also makes Gnosis Safe a critical piece of infrastructure required by any new network (both L1 and L2) to enable consistency across the network for teams securing their protocols with Gnosis Safe.

Additionally, Gnosis Safe expands its (DeFi) capabilities with “Safe Apps”, to provide a convenient way to interact with Ethereum's dynamic application ecosystem directly within the wallet interface.

Out of Gnosis, Now Only "Safe"

In 2022, it will become clear that Gnosis Safe is more than just a product and will require a variety of customized solutions to optimize the different user groups starting to use Gnosis Safe. So, the GnosisDAO community decided to separate this project. 

Safe's (current) mission is to develop an entire ecosystem around Safe Smart Accounts with the goal that every user group and use case on Ethereum can benefit from Smart Accounts.

After successful fundraising from strategic investors, and the establishment of the Safe Ecosystem Foundation, SafeDAO was formed in 2023.

"SafeDAO's mission is to establish [smart accounts] as the default way to interact with web3. (…) Through open source components and ecosystem initiatives, we foster the Safe Ecosystem, consisting of wallets, infrastructure, devices and services." (SafeDAO Constitution)

In 2023, Safe also launched Safe{Core}, a developer suite focused on cultivating a dynamic ecosystem of wallets and applications that leverage Safe Smart Accounts. 

In the same year, Safe also reached new records such as 1 million Safe Smart Accounts created across use cases ranging from AI to social, gaming and identity.

Some examples:

• AI agent accounts for approximately 50% of Safe transactions on Gnosis Chain via Autonolas
• Safe Smart Account implemented via Worldcoin generating hundreds of thousands of transactions every month
• Drakula.app (a web3 TikTok) onboarded >20,000 users to smart accounts in 48 hours

Latest Developments in Safe (SAFE)

Now, in 2024, Safe has become smart contract which secures the second largest asset. This smart contract managed to pocket $100 billion in value after the ETH Staking deposit contract. 

Over 7 million Safe Smart Accounts have been created and world-class applications such as Worldcoin and Gnosis Pay are building their solutions powered by Safe. Currently, more than 200 projects are integrated with Safe Smart Accounts.

Having worked on smart accounts for the last 6 years, we have seen a clear trend towards smart account adoption over time and become more confident each year that, eventually, every account on Ethereum will be a smart account.

Safe's journey from a multi-signature wallet to a comprehensive ecosystem relies heavily on consistency, a focus on security, and adhering to an open-source ethos, which are values ​​that must be carried far into the future.

There are still many challenges to be solved such as cross-chain abstraction, modularity, wallet interoperability, economic sustainability, etc., so consider this just the beginning of the story for Safe.

Conclusion

Safe's core mission is to accelerate the transition to smart accounts. Through open-source technology and ecosystem support initiatives, we promote the benefits of smart accounts and enable users and developers to take advantage of them. 

To date, Safe has successfully onboarded more than 7 million users and $100 billion in digital assets into smart accounts. And this is just the beginning.

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