Smart Accounts on Osmosis: Redefining UX and Account Management in DeFi
The crypto ecosystem advances quickly while the user experience (UX) often lags behind. Osmosis aims to bridge this gap with Smart Accounts, an innovative account and asset management feature that enhances usability, flexibility, and security, with robust multi-device support for on-the-go trading.
The Vision for Smart Accounts on Osmosis
The vision for Osmosis Smart Accounts is to revolutionize crypto account UX by addressing common user challenges with a solution that: streamlines user onboarding and account recovery, simplifies account management, and provides a seamless and intuitive trading experience for newcomers and experienced users alike.
Smart Accounts: Key Features and Functionalities
Osmosis Smart Accounts boast several key features and functionalities:
🧪 Automation + 1-click Trading
🧪 Multi-Key + Multi-Device Support
🧪 Easier Onboarding + Account Recovery
🧪 Advanced Security Protocols
🧪 Extensible + Composable
👇 Let’s dig in deeper👇
1) Automation and 1-click Trading
Automate trading with opt-in features like stop orders, and benefit from a faster trading experience with 1-click trading.
You’ll no longer have to sign or authorize a transaction every time you place a new trade, even if you use a cold storage wallet like a Ledger device.
2) Multi-Key and Multi-Device Support
Enables seamless navigation across multiple devices, without the hassle or security risks of handling private keys.
If a device linked to your crypto account is lost or stolen, you can quickly deactivate the device’s access, preventing unauthorized transactions and giving you peace of mind.
You can even provide a trusted individual with temporary access to pre-specified assets or a portion of your funds, and later revoke their access if needed.
3) Improved Onboarding and Account Recovery
Simplifies onboarding for newcomers and streamlines the account recovery process.
Integration of Leading Web 2.0 Standards: Instead of writing down and safeguarding private keys and recovery phrases to create a new account, you can use familiar authentication technologies like Face ID, Touch ID, and Passkeys to easily create a new account, or manage or access existing accounts.
4) Advanced Security Protocols
Features like customizable transaction limits and dynamic authentication enhance usability and security.
You can set maximum transaction limits to prevent unwanted access to assets you don’t intend to trade with actively. For example, if you’d like to DCA a total of 100 USDC into WBTC over 10 weeks, you can limit the DCA application from withdrawing or exchanging more than a maximum of 10 USDC per week from your account.
For high-value transactions, you can configure Smart Accounts to require additional authentication methods, like biometric verification or confirmation from a secondary device.
5) Extensible and Composable
Developers can tailor authentication logic, extending beyond basic functionalities.
Developers can build and integrate custom applications with Smart Accounts on Osmosis, like social recovery systems, or anti-phishing features that verify the authenticity of transaction requests.
Use Your Smart Account Across the Osmosis Ecosystem
Following the initial launch of smart accounts, additional applications and protocols will begin to integrate Smart Accounts, allowing you to benefit from the full set of features and functionalities on the Osmosis DEX and your favorite applications across the Osmosis ecosystem.
The Limitations of Traditional Crypto Wallets and Account Abstraction Solutions
Traditional crypto wallets, or externally owned accounts (EOAs), have several limitations:
• A single private key controls your entire account
• No recovery options if you lose your private keys
• You need to manually transfer private key data between devices/apps/extensions
• No key rotation capabilities
These limitations are particularly challenging for newcomers, who — among other things — need to learn how to protect their private keys and recovery phrases.
EOA-based systems typically lack robust multi-device support, forcing users who want to access their accounts on different devices to compromise their security by manually transferring recovery phrases.
Additionally, managing multiple networks, applications, and browser extensions adds complexity and exposes users to security risks like malware and phishing.
This results in a complex and unforgiving user experience that falls short of the standard experience of many modern digital services outside of crypto.
EVM-based Account Abstraction solutions are designed to address these limitations. However, they have their own set of challenges, including:
• Smart contract-based accounts cannot initiate transactions independently; they must be linked to a legacy account
• Introducing new cryptographic primitives has historically been slow and challenging
• There’s notable fragmentation across networks and providers, causing vendor lock-in
• Existing EOAs cannot be upgraded to smart contract accounts
Account Abstraction is not native to the EVM at the protocol level, so these solutions are built using smart contracts — and thus cannot be used to upgrade legacy accounts.
Osmosis Native Smart Accounts: An Improvement on EVM Account Abstraction
Unlike EVM Account Abstraction solutions, Osmosis Smart Accounts:
• Are natively built into the Osmosis protocol
• Capable of initiating transactions directly
• Allow you to upgrade your legacy (EOA) accounts into Smart Accounts, without changing your wallet address
• Can be integrated with third-party Account Abstraction technology stacks
Osmosis’s native approach takes the contract-level solutions typical of Ethereum and other EVM networks to the next level, and will be available to users for free to improve crypto onboarding and overall user experience.
Looking Ahead
Osmosis Smart Accounts can potentially transform the user experience across the DeFi landscape. By addressing the limitations of traditional crypto wallets and EVM-based Account Abstraction solutions, and enhancing crypto account functionality and asset management, this solution simplifies trading for seasoned traders and streamlines the onboarding process for newcomers.
FAQs
1. What are Smart Accounts on Osmosis?
Smart Accounts are an upcoming feature designed to enhance the DeFi user experience. They integrate advanced features that can provide added security, support trading across multiple devices, and enable seamless cross-chain transactions.
2. How do Smart Accounts improve the onboarding process for new users?
Smart Accounts streamline onboarding by incorporating intuitive features like Passkeys, Face ID, and Touch ID, reducing the learning curve for new users.
3. Can I use Smart Accounts on multiple devices?
Yes, Smart Accounts enable multi-device functionality, allowing users to manage their accounts from devices like smartphones and laptops, ensuring secure and functional trading on-the-go.
4. Do Smart Accounts increase user security?
Smart Accounts alone do not provide better security than traditional accounts, but the features made available to Smart Account users are indeed intended to enhance user and asset security.
Among other things, Smart Accounts leverage secure enclaves in modern devices and provide enhanced security through customizable transaction limits and dynamic authentication to safeguard against unauthorized access and potential asset loss.
5. What are the benefits of 1-click trading in Smart Accounts?
1-click trading enables users to execute trades quickly without repeated re-authentication, offering a streamlined trading experience similar to centralized exchanges.
6. How do Smart Accounts handle account recovery?
Smart Accounts improve account recovery by integrating modern authentication methods that simplify the process and can offer new custom account recovery methods.
7. Are Smart Accounts compatible with traditional EOA accounts?
Yes, traditional EOA accounts can be upgraded to Smart Accounts, allowing users to retain their existing accounts while benefiting from new, enhanced features.
8. Can developers build on and integrate with Smart Accounts?
Yes, developers can build on Smart Accounts by creating and integrating custom transaction authentication logic, enabling valuable applications like social recovery systems.
9. When will Smart Accounts be released for users?
The mechanisms for enabling Smart Accounts are being added to the Osmosis chain in the upcoming v25 upgrade. Smart Account functionality will then be enabled via future governance proposals in the coming months.
Follow Osmosis on Twitter to stay up-to-date on the latest developments: https://x.com/osmosiszone
