SAFE is primarily known as the leading provider of multi-signature (multi-sig) wallets for teams, DAOs, and organizations to manage their funds. Beyond this, SAFE offers comprehensive wallet infrastructure built on smart contract wallets, with its main business lines including Safe{Wallet}, their smart contract wallet solution, and Safe{Core}, an open-source and modular account abstraction stack.

Running the show from the shadows
While crypto natives frequently discuss multi-sig technology, many don't realize that SAFE is the dominant infrastructure provider in this space. Trusted by major projects like 1inch, Aave, and Chainlink, and supporting a wide range of EVM networks, SAFE has established itself as a crucial cornerstone of the crypto ecosystem due to the massive value it safeguards.

SAFE{Wallet}
SAFE serves as critically important infrastructure for crypto users and developers, safeguarding digital assets for projects, DAOs, institutions, and individuals. As of October 2024, SAFE manages over US$70 billion worth of assets across more than 25 million safes, which have collectively executed more than 97 million transactions. These numbers clearly demonstrate SAFE's strong Product Market Fit (PMF) and highlight the widespread adoption of smart contract accounts.

Safe{Wallet} offers top-grade security and audited contracts, providing multi-sig self-custodial wallets that promote decentralized co-ownership of assets. Additionally, Safe{Wallet} can be accessed via mobile applications on both the App Store and Google Play Store, ensuring convenient access for all SAFE users.

SAFE{Core}
Safe{Core} provides a comprehensive set of open-source tools and infrastructure that developers can leverage to implement secure, battle-tested account management features in their applications. Its key features include various forms of account abstraction, such as chain abstraction and payment abstraction. Safe{Core} also enables seamless integration with the robust Safe Ecosystem, which currently supports more than 200 projects building tools for identity abstraction, DeFi operations, on-chain governance, and asset management.

The account abstraction stack comprises the Safe Core SDK, which offers developers a comprehensive account abstraction toolkit. Additionally, it includes the Safe Core APIs, designed to enhance existing project interfaces, and the Safe Smart Account, a modular and extensible smart contract account that accommodates diverse use cases.

Use cases

The impact of SAFE on the crypto ecosystem is undeniable. According to Areta, SAFE secures more assets than any Layer 1 or Layer 2 blockchain, including Ethereum. 

SAFE’s use cases span multiple sectors within crypto:
• Payments: Gnosis payment wallets are utilizing Safe for secure transactions. Read more.
• Social: Farcaster’s Frames are built on Safe, leveraging Safe accounts. Learn more.
• Digital Identity: Worldcoin has integrated Safe accounts through proof-of-humanity verification. Details here.
• Institutions: Safe provides institutional-grade security for organizations like 1kx and Wintermute. Explore more.
• Ecosystem Layers: Platforms like Celo and Polygon zkEVM have integrated Safe to enhance user experience. Celo integration, Polygon zkEVM integration.
• NFTs: Punk6529’s gallery is powered by Safe, showcasing its application in the NFT space. Find out more.

In the next section, we will discuss how SAFE’s traction can convert into revenue and potential upside for the SAFE community.

Crouching Tiger, Hidden Dragon

In May 2024, SAFE launched native swaps which allowed Safe{Wallet} users to trade tokens within their wallets. Later in July 2024, SAFE introduced TWAP Orders and tiered fees in Safe{Wallet} native swaps, adding more functionality to their native swaps.

In September 2024, the SAFE Ecosystem Foundation put out a proposal for the revenue generated from native swap to be pledged to SafeDAO. This marks the first revenue stream for the SAFE community.

Taking a look at data on-chain, native swaps on SAFE generated a total of US$1.6 million  in annualised revenue (based on the tiered fee model). However, at present, only slightly more than 0.01% of Safes utilised the native swap function.

We believe that this number is not representative of the demand for swaps in DeFi. According to Nansen, there were more than 1.2 million unique traders who used decentralised exchanges (DEX) throughout 2022. Cross-referencing a report by Grayscale that estimated there to be around 7 million DeFi users in 2022, it can be estimated that around 17.14% of DeFi users utilise swaps. However, given that Safes are generally used for treasury management, it is likely that swap usage amongst SAFE users might not be as high. Taking the most conservative projection as reference, with just 1.71% of Safe’s utilising native swaps, this is estimated to produce more than US$274 million in total annualised revenue. For reference, Uniswap generates an estimated $703 million in annualised fees, while Curve generates an estimated US$27 million in annualised revenue.

tl;dr

SAFE currently commands a whopping US$74.2 billion in Total Value Locked (TVL) across its safes. Moreover, much of this TVL has yet to get involved in revenue-generating native swaps. Additionally, on SAFE’s roadmap is the introduction of revenue generation from native staking as well as a possible fee-sharing mechanism in the future. Considering SAFE’s huge untapped market as well as its future revenue streams, this could very well be the making of the next revenue generating beast. 

This article was written by @ahboyash and @0xsamoyed.

*Disclosure: SAFE is Signum Capital’s portfolio company and the information provided on this newsletter is for general informational purposes only and does not constitute professional nor investment advice.

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