Smart contract wallets are a breakthrough in the security and usability of crypto wallets. They can offer features such as recovery without seed phrases and automatically blocking transfers to untrusted contacts. They’re able to do this by building on smart contracts.
What is a cryptocurrency wallet?
A cryptocurrency wallet, like Argent, lets you store cryptocurrency and access decentralized apps (Dapps).
Most wallets have traditionally been Externally Owned Accounts (EOAs). These are controlled by a private key (which you can think of as a password for crypto). Smart contract wallets are an alternative. They’re built on smart contracts, as the name suggests, and allow for more functionality.
What is a smart contract wallet?
Code, not a private key, controls a smart contract wallet. The smart contracts make it possible to program features into the wallet like social recovery, transfer limits, and account freezing. They can therefore combine usability and security.
No wonder Ethereum co-founder Vitalik Buterin supports the mass adoption of smart contract wallets like Argent.
What can you do with a smart contract wallet? The possibilities of smart contract wallets are broad. They allow for whatever can be programmed into them.
Some examples include:
- Multisig security: Argent relies on Guardians. Guardians are trusted third parties, such as friends and family, or a secondary wallet. Guardians can recover the wallet or approve a new device; approve transfers over your daily limit, and allow transfers to untrusted wallets.
- Transfer limits: Users can set transfer limits preventing hackers from emptying the wallet if it is compromised.
- Approve addresses: With a smart contract wallet, you can approve transfers to known addresses.
- Bundle transitions: Increasing user experience by bundling transactions with Dapps that generally have multiple steps.
- Account freezing: In the event of misplacing your phone, or worse, theft, a smart contract wallet can get locked, preventing funds from getting spent.
These are just some of the functions made possible with smart contract wallets. Anything is possible.
If you're interested in smart contract wallets, we encourage you to download Argent and try it out. It takes less than a minute to set up, and you'll get to enjoy the best user experience in crypto without compromising on security.
What Are Smart Contract Wallets, and How Can They Benefit DeFi Users?
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