Coinbase's beta product allows the integration of self-custody wallets into applications, supporting access via email and SMS.
The crypto asset exchange Coinbase just announced the Embedded Wallets feature in beta, allowing developers to integrate self-custody wallets directly into their applications. The product is positioned by Coinbase as a useful tool for the 'next generation of gaming, payments, DeFi, and social networking applications,' particularly focusing on applications revolving around stablecoins.
Embedded Wallets allow users to access crypto asset wallets using just an email address or SMS, removing traditional technical barriers. Users do not need to install browser extensions or store complex seed phrases, while still maintaining full control over the interface and user experience. More importantly, the wallets operate on a non-custodial self-custody model, meaning users hold their private keys and have complete control over their assets.
Coinbase emphasizes that the timing of the product launch is particularly suitable as the world is shifting to payment systems based on stablecoins with global reach, programmability, and lower costs than traditional systems. The exchange also believes that the GENIUS Act and CLARITY Act have created a legal framework that facilitates developers in accelerating the deployment of applications using stablecoin-based payment infrastructure.
Stablecoins from trading tools to payment infrastructure
Stablecoins, crypto assets with stable value typically pegged to the USD, have undergone significant development from their initial role. While previously mainly used by traders to exchange between assets or preserve profits without withdrawing to traditional banks, stablecoins are now being considered by major corporations like Meta, Amazon, banks, and even several states in the U.S. to issue their own stablecoins to promote blockchain-based payments.
This move is supported by a clearer legal framework as President Donald Trump signed the GENIUS Act into law this month, the first law establishing a legal framework for the issuance and trading of stablecoins in the U.S. This creates a conducive environment for the development of stablecoin-based payment applications.
Embedded Wallets are part of Coinbase's strategy to expand its product ecosystem for developers. Besides being the largest crypto asset exchange in the U.S., the San Francisco-based company is also developing tools to help developers build crypto asset products such as the Base Layer 2 network on Ethereum.
Coinbase also plays a crucial role as a partner of the U.S. Government, tasked with the custody of seized digital assets in cases related to digital finance.
