Original title: State of Safe Q1 2024
Original author: Mihai Grigore, Seth Bloomberg
Original source: messari
Compiled by: Vernacular Blockchain
Key Takeaways:
-Safe is one of the preferred solutions for smart contract wallets, storing over $100 billion in assets and with over 8 million deployed smart accounts.
- Safe reached all-time highs across most usage metrics in Q1 2024. Safe users continue to gain value from the core wallet product, with 1.6 million monthly active accounts in Q1 2024 (up 181% QoQ) across multiple deployments on more than 10 networks.
- In Q1 2024, the total share of transactions initiated by Safe smart accounts reached 2.5% (up from 2.3% in Q4 2023). At the same time, the gas fees generated by Safe reached more than 34,500 ETH in Q1 2024 (up 138% month-on-month).
-Safe社区投票通过，将于2024年4月23日起允许SAFEToken可转让。与此同时，一项成功提案引入了增强SAFEToken实用性的策略，将生态系统活动与Token实用性相结合。
-SafeDAO financial management was delegated to karpatkey after community vote.
1. Basic knowledge
Safe is one of the most popular smart contract wallet solutions, storing over $100 billion in assets and with over 8 million deployed smart accounts. Formerly known as Gnosis Safe, Safe aims to create a standard for ownership through smart accounts.
Safe is primarily used as a multi-signature wallet, which enables individuals to securely self-custody funds and organizations to efficiently manage their financial operations. According to Messari’s wallet landscape analysis, Safe is a wallet infrastructure aggregator, in addition to providing a smart contract wallet. Therefore, Safe is both:
Safe{Wallet}: The main product is a smart wallet solution (i.e. Safe’s user-oriented smart contract wallet);
Safe{Core}: The infrastructure protocol that powers Safe’s wallet solution and other projects such as Worldcoin.
The Safe{Core} Protocol adopts a vendor-agnostic approach so that any developer can contribute to the protocol. Additionally, a key consideration for the Safe{Core} Protocol will be fee design and implementation.
Safe社区投票通过，将于2024年4月23日起允许SAFEToken可转让。同时，一项成功提案提出了增强SAFEToken实用性的策略，将生态系统活动增长与Token实用性相结合。
2. Key indicators
1) Network
Safe usage can be measured by observing its account and transaction activity on multiple networks. As of Q1 2024, Safe has been deployed on more than 10 networks, including Optimism, Polygon, zkSync, Arbitrum, Avalanche, Base, BNB Chain, Celo, Ethereum, Fantom, and Gnosis Chain.
2) Active accounts
Active accounts refer to the average monthly number of Safe Smart Account users with at least one outgoing transaction per month.
In Q1 2024, Safe’s average monthly users reached over 1.6 million, up 181% from the previous quarter, compared to nearly 600,000 in Q4 2023. In Q1 2024, Safe’s average monthly users on Optimism surged to 1.58 million (up 211% from the previous quarter), accounting for a staggering 96% of Safe’s average monthly users in that quarter. Polygon and zkSync accounted for 1.5% and 1.2% of Safe’s average monthly users in Q1 2024, respectively.
The increase in Safe accounts on Optimism can be primarily attributed to the Worldcoin protocol’s decision to migrate to OP Mainnet in Q2 2023. Worldcoin has since deployed Safe smart accounts on OP Mainnet for its World App users. As of March 31, 2024, a total of 2.85 million Worldcoin smart accounts have been deployed on Safe.
With the latest announcement from World Chain Layer2, it remains to be seen whether Safe’s number of monthly active users on Optimism will continue to grow in the coming quarters. To provide background information, Dencun upgraded and implemented EIP-4844, thereby significantly reducing Layer 2 transaction costs. In turn, lower transaction costs may alleviate the high usage costs associated with smart wallets, according to recent analysis by Messari.
3) New Account
In Q1 2024, the number of newly created Safe Smart Accounts reached over 2.2 million, a 124% increase from the previous quarter, compared to 1 million new accounts in Q4 2023. In terms of the corresponding chains, Optimism accounted for 85% of the newly created Safe Smart Accounts in Q1 2024, or 1.9 million accounts, an increase of 18% from the previous quarter. In Q1 2024, over 99% of the newly created Safe Smart Accounts on Optimism were Worldcoin’s Safe Account deployments in that quarter. Meanwhile, zkSync and Base accounted for 6% and 3% of the newly created Safe Smart Accounts, at 137,000 and 77,000, respectively.
Polygon saw 71,000 newly created Safe Smart Accounts in Q1 2024, a 92% decrease from the previous quarter, compared to 847,000 in Q2 2023. This growth difference between Optimism and Polygon can be explained by Worldcoin’s migration from Polygon to Optimism’s OP Mainnet ecosystem in Q2 2023.
4) Adoption rate
With the growth of active Safe users, the number of transactions involving Safe Smart Accounts (Safes) increased by 161% from 6.3 million in the fourth quarter of 2023 to nearly 17 million in the first quarter of 2024. For comparison, Safe transactions accounted for 2.5% of all transactions in the first quarter of 2024, compared with only 0.65% in the first quarter of 2023, an increase of about 4 times.
Now, the vast majority of Safe's on-chain activity occurs on Layer 2 scaling solutions, with Optimism accounting for 93% of all Safe transactions, followed by Gnosis and zkSync, each accounting for 2%. According to Messari's wallet market analysis, infrastructure aggregators such as Safe are expected to further benefit from the influx of new crypto applications.
3. Financial situation
目前，Safe并未从其智能合约钱包或其一般产品套件中产生任何收入。然而，源自Safe智能合约钱包的Gas费用可以作为Safe在其多个部署中相关价值的一种代理。从这个意义上说，Safe{Core}协议的一个关键考虑因素将是费用设计和实施。同时，一个成功的提案引入了增强SAFEToken实用性和通过将生态系统活动与Token实用性联系起来潜在产生收入的策略。
1) Transaction Fees
Gas fees used on the Safe transaction platform grew 138% in Q1 2024 to over 345 billion gwei, equivalent to 34,500 ETH, in line with the growth in transactions involving Safe. General activity migrated from the Ethereum mainnet to scaling solutions such as Optimism, while EIP-4844 and World Chain Layer-2 were introduced. As a result, Safe may see a reduction in average fees per transaction in the coming quarters. However, the projected reduction in average fees per transaction may continue to be offset by the growing user base spawned by these low-fee Layer-2 chains.
2) Assets stored in Safe
Another way to measure the economic value of a Safe account is to consider assets under management (AUM). For Safe, the USD value of assets stored in Safe Smart Accounts is a suitable proxy for AUM.
As of the end of the first quarter of 2024, the total assets stored in Safe exceeded $112 billion, an increase of 88% from the previous quarter. For comparison, Robinhood Securities reportedly had $119 billion in assets under management in the first quarter of 2024, which is comparable.
In terms of distribution across different chains, Ethereum ranks first, with $88 billion (83%) of assets stored in Safe smart accounts, followed by Optimism and BNB Chain with $9 billion (9%) and $4 billion (4%), respectively.
It is worth noting that although Optimism accounted for 93% of transaction share and 96% of monthly active users in the first quarter of 2024, its share of assets stored in Safe was only 9%. On the contrary, Safe smart accounts on Ethereum store assets with larger amounts and lower transfer frequencies compared to Layer-2.
4. Qualitative analysis
1) Main development
Safe{RecoveryHub}: Safe{RecoveryHub} was launched, enabling users to set up account recovery for wallets on Ethereum, Arbitrum, Optimism, Polygon, and Gnosis Chain. Various recovery options will be rolled out gradually, starting with self-hosted recovery and eventually introducing third-party recovery in the first half of 2024 through partnerships with Sygnum and Coincover.
The self-hosted recovery feature allows users to set up a “restorer” who can initiate the account recovery process and set a recovery review window as well as a transaction expiration period during which users can reject recovery.
Launching on Blast: Safe Protocol is now available on the Blast network via the Brahma Protocol. Blast is the latest of more than 10 networks where Safe Protocol has been deployed, including Ethereum, Polygon, Optimism, Arbitrum, Gnosis, Base, zkSync, Fantom, Avalanche, and BNB Chain.
2) Key governance
SAFEToken实用性 (SEP 21)
Safe生态系统提案(SEP 21）于2024年3月18日通过，正式概述了根据SEP 3增强SAFEToken实用性的策略：
Expand the SafeDAO ecosystem and link ecosystem growth to token utility.
需要说明的是，目前SAFEToken的实际用途主要是治理，允许Token持有者对SafeDAO事项进行投票。即将推出的Safe活动计划旨在通过赞助的交易、季节性NFT和潜在的SAFEToken等福利，奖励Safe智能账户的活跃用户。它的最终目标是提高活跃用户的参与度和Token分布。值得注意的是，SEP 21指出，使用Safe智能账户的开发者不应被要求使用SAFEToken。这样做的原因是为了避免阻碍采用。
To enhance the practicality of Safe smart accounts, SEP 21 emphasizes development centered on account abstraction and implements multiple abstraction layers such as network, username, payment, and security abstraction. Future exploration of Token practicality will involve: community feedback, funding decisions for SafeDAO, and possible approval of new practical functions.
SEP 21 also emphasizes the need to consider the impact of various stakeholders, including users, developers, and token holders. The goal of SEP 21 is to align strategic priorities with the broader goals of the Safe ecosystem.
SAFEToken的可转让性 (SEP 22)
这项成功的提案使得自2024年4月23日起，SAFEToken可以进行转让。未解锁的Token将继续存放在解锁合约中，因此在解除SAFEToken的冻结后，它们仍无法进行转让。该提案是在完成SEP 3中规定的所有里程碑之后提出的。
在即将推出的Safe活动计划中，SAFEToken将继续用于SafeDAO的治理，并提供额外的福利，正如SEP 21中所概述的。通过SEP 23中批准的SafeToken实用性Sprint 1，目前正在进一步探索SAFEToken的其他实用性。
SafeToken实用性Sprint 1 (SEP 23)
This successful proposal request provides 50,000 USDC for creating and funding a working group. It is responsible for researching and designing the following three to five use cases: DEFI module and pledge.
The proposal will be divided into three phases:
List potential use cases.
Categorize based on resource requirements and value potential.
The first five of these were selected and elaborated for development.
Finance Manager (SEP 24)
The successful proposal selected karpatkey as the financial management service provider for SafeDAO. As part of his assignment, karpatkey will be responsible for managing the financial affairs of the combined SafeDAO and GnosisDAO funding pool. As a service provider for SafeDAO, karpatkey’s responsibilities include:
Financial Management,
Integration of the SAFE protocol,
Risk Management,
Research.
联合资金池中包含5%的SAFEToken。karpatkey将利用这个资金池，在Gnosis Chain上创建具有流动性的Safe市场，其中最多使用250万个SAFEToken来激励Gnosis Chain上的SAFE DEX流动性。
In addition, the proposal also points out that the joint fund pool will provide liquidity for Safe on Ethereum and Gnosis Chain. Karpatkey may also diversify the fund pool in the future and use assets for staking or other methods to obtain asset returns.
The agreement provides for an indefinite duration of the agreement and that SafeDAO can terminate it through another governance vote. An annual fee of 2% will be charged based on AUM, paid monthly.
Split Mandate (SEP 16)
The successful proposal requested 60,000 USDC to increase governance participation by building an updated delegation registry and snapshot strategy.
The program includes three key features:
Split delegation: An account can delegate its voting weight to any number of other accounts and define the proportion of voting weight each delegated account should receive.
Transitive delegation: Accounts can delegate not only their own voting weight, but also any delegated weight given to them.
Delegation period limit: Accounts and Snapshot spaces can choose to set the validity period of each delegation.
Enhanced modular Safe Accounts (SEP 13)
The successful proposal requested 60,000 USDC in funding over 15 weeks to provide a platform for developers to build, publish, and verify modules through on-chain audits, and provide users with a convenient way to explore and enable these modules. ZenGuard plans to attract module developers and auditors, provide a module explorer Safe App, and work on developing an SDK to facilitate integration and automation.
Governance Analytics Dashboard (SEP 12)
This successful proposal requested 50,000 USDC to support infrastructure costs and in-depth governance reporting development from February to July 2024. In line with the strategy to increase participation in governance, this initiative will provide analytical reporting on voting patterns, participation rates, and distribution of voting power. This is intended to promote informed decision-making within the SafeDAO community.
Governance Amendment (SEP 11)
This successful proposal amended SafeDAO’s governance process for Season 1, Sprint 4. Amendments included the introduction of fractional delegation, revisions to the voting mechanics for the OBRA initiative, adjustments to the voting timeline, an extension to the soft launch for Season 2, and clarifications for the OBRA initiative with implementation dependencies.
The introduction of fractional delegation was developed in collaboration with the Gnosis Guild and is intended to increase voter turnout by allowing larger token holders to delegate part of their voting weight individually. The revised voting mechanism for the OBRA initiative is designed to effectively manage budget constraints by adopting a ranking system for approved initiatives.
5. Important events
1) Multis Acquisition
Safe announced the strategic acquisition of Multis, an all-in-one financial software designed for cryptocurrency businesses. According to the announcement, the acquisition will help Safe "solve the complexity of cross-chain interactions through network abstraction, with the ultimate goal of enabling users to easily manage assets on different blockchain networks." Multis' senior leadership team has joined the Safe Ecosystem Foundation, and former Multis CEO Thibaut Sahaghian will serve as the head of network abstraction for the Safe core team.
2) Partnership with Base
Safe announced a partnership with Base to provide modular tools for developers building smart accounts on Base. To support developers incurring gas fees when leveraging Safe's smart account infrastructure, Base is offering (up to) 1 ETH of gas fee credits during the initial 12-month rollout of the program. Safe x Base developers can sign up for the gas fee program by filling out this form.
6. Summary
While most smart contract wallets have had difficulty finding mainstream adoption, Safe remains an exception. As the leading smart contract wallet system, Safe users continue to gain value from the core wallet product in the first quarter of 2024, with total assets stored in Safe exceeding $112 billion, comparable to Robinhood's AUM, which reached $119 billion in the first quarter of 2024.
Safe hit all-time highs in most usage metrics in Q1 2024. Safe users continue to gain value from the core wallet product, with active accounts reaching 1.6 million in Q1 2024 (up 18% QoQ). In addition, the share of transactions from Safe smart contract wallets increased to 2.5%, a new all-time high. Wallet infrastructure aggregators like Safe are expected to benefit from the influx of new crypto applications.
The Safe community voted in favor of making SAFE tokens transferable starting April 23, 2024. At the same time, a successful proposal introduced a strategy to enhance the utility of SAFE tokens, combining ecosystem activities with token utility.