# **How to Boost User Adoption By Simplifying Access to Your Onchain Products and Services**

### A guide to using Coinbase Smart Wallets and the MagicSpend paymaster to get new users to instantly onboard and engage with your platform

**

Onboarding, directly and indirectly, can affect your product’s success and profitability. And for new users unfamiliar with blockchain technology, onboarding to your first onchain platform can be a complex, daunting, and unfamiliar experience. This complexity creates a significant barrier to entry, hindering user adoption and engagement for your brand. 

According to [a study by Deloitte](https://www2.deloitte.com/content/dam/Deloitte/dk/Documents/technology-media-telecommunications/Downloads/GMCS-report-2018-final.pdf), more than 40% of users abandon onboarding processes in digital channels because it either took too long or was fiddly and overwhelming. In order to convert traditional web2 users onchain, you need an onboarding process that is quick and simple. Coinbase’s Smart Wallet enables onchain brands to onboard new users in seconds without the need to already have a wallet and without the need to ever onramp or top-up funds. This means new users can begin engaging with your onchain products or services immediately.

This is possible through the Smart Wallet’s use of Coinbase’s MagicSpend paymaster that enables Smart Wallet users to instantly and safely use their custodial Coinbase accounts to transact across the web3 ecosystem.

This guide will delve into these innovations, how they work, and how onchain developers can use them to create better user experiences to boost adoption and drive growth for their platforms. 

Why most web3 platforms fail to convert new onchain users 
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A major hurdle for new users trying to access onchain products is that it requires they already have a crypto wallet. For users accustomed to transacting onchain, this won’t be a problem as they will likely already have a stand-alone wallet such as MetaMask, Coinbase Wallet, or Ledger. However, users new to the onchain world now have the added complexity of finding, downloading, and learning how to operate some third-party wallet. This means that before they can even access any of your onchain services they must learn what a seed phrase is; understanding that if they lose this phrase then they lose access to their wallet; know how to properly configuring their network; learn how to fund their account; and understand how to secure their wallet against the flood of threats all onchain participants face.  

Onboarding these traditional, non-crypto native consumers continues to be one of the most significant growth challenges across the crypto ecosystem. For newcomers, this process of onboarding is complex and daunting. The poor user experience and the lack of technical comfort associated with these processes creates a substantial barrier to entry for non-crypto savvy consumers and often result in a failure to convert users beyond already established web3 enthusiasts. This not only limits the adoption of your onchain products, but the broader adoption of blockchain technology and its associated benefits globally.

The next wave of crypto users will come from traditional off-chain institutions. And these users will expect the same simple onboarding and transactional experiences they are already familiar with. To capture this audience, brands must rethink the way they interact with users on their platforms. 

# How Smart Wallets can reduce onboarding friction and boost user adoption on your platform

Integrating Smart Wallet support on your platform will make it easier than ever to onboard new users by eliminating the complexity of needing to find and fund a wallet. This, inturn, will lead to higher conversions for your onchain products and services.

## Get new users onchain in seconds
Coinbase Smart Wallet enables users to create an account in seconds with no app or extension required and no complicated seed phrase to memorize. This is possible because Smart Wallet uses passkeys for signing. These Passkeys are generated and stored securely on users' devices and are never seen by Coinbase or your onchain platform. If the user has iCloud or Google Password Manager, their passkeys will also be backed up and synced across devices.

## Instantly use your onchain platform without funding their wallet
Smart Wallet leverages the power of Coinbase’s MagicSpend paymaster to offer a seamless transactional experience through a direct integration with the user’s Coinbase account. This means users can spend assets from their Coinbase custodial account for:

- Instant Onboarding: Users can transact onchain without needing to onramp or top-up funds. This reduces the number of steps involved and simplifies the process of using your platform.

- Just-in-Time Funding: MagicSpend connects directly to the user’s Coinbase account, allowing for just-in-time funding. This means that users don’t need to worry about maintaining a balance in their wallet; they can use their Coinbase balance directly.

- Enhanced Security: Users can store funds in a custodial account if necessary but still use these funds in decentralized applications, balancing security and usability. This is particularly attractive for users who are cautious about the security of their funds.

Users can choose to use their Coinbase balance to cover as much as the full cost of the transaction or as little as just the gas. These transactions are protected by standard 2-factor authentication methods and will be visible in the user’s Coinbase app.

This seamless integration eliminates friction points, making transactions smoother and faster. MagicSpend makes using your platform more accessible to newer onchain users, helping to attract a wider audience. This is crucial for developers looking to expand their user base beyond the crypto-savvy crowd.

Even experienced crypto users can benefit from the use of Smart Wallets with MagicSpend for actions such as:

- One-Click Yield Earning: Move ETH from Coinbase to a yield earning app like Moonwell to start earning yield with one click. This simplifies the process of investing in DeFi projects and makes it more attractive to new users.

- One Click Token Swapping: Swap tokens on a DEX like Aerodrome directly from a Coinbase account. This streamlines the trading process and reduces the need for multiple transactions and approvals.

Smart Wallet and MagicSpend in Action
-------------------------------------

If you haven’t created a smart wallet yet, I’d highly recommend you try; it takes all of three seconds. Once your wallet has been created you can securely connect your Coinbase account to seamlessly fund your wallet (depicted below). This enables users to either onramp funds to their wallet directly from their Coinbase account, buy crypto from Coinbase to fund their wallet, or just leave their wallet empty and pay for a transaction with their Coinbase balance without the need to ever move funds.

Creating a Smart Wallet

Smart Wallets are created almost instantly, reducing the time and effort required for users to get started. They can be created and accessed at any time at [https://wallet.coinbase.com/](https://wallet.coinbase.com/) or directly from your website or application.

Upon sign up, the user will be prompted to create a passkey from one of several options, such as biometrics, security keys, or your browser profile. On the back end, Coinbase will then deploy a smart contract on Base that pins that passkey's public key as the authorized key for transactions from that Smart Wallet account. Passkeys stored on the user's device, not with Coinbase.

==*Creating a Smart Wallet on matcha.xyz*==

## Using alternative payment methods onchain
Once the wallet is set up, users have multiple options to fund it, all facilitated through a secure connection to their Coinbase account. In the screenshot below, we see that a user’s new Smart wallet does not yet have the funds to engage in the transaction. Through MagicSpend, users can easily switch the payment method from the Smart Wallet to Coinbase and either pay directly with their Coinbase account, or decide to top off their Smart Wallet using funds from their Coinbase account as seen below,**

==*Creating a passkey for your Smart Wallet*==

==*Initiating a transaction with Smart Wallet. Payment method is defaulted to paying with funds within the Smart Wallet.*==

==*Switching Payment Method to Coinbase will require connecting Coinbase custodial account to Smart Wallet.*==

# Securely signing into your Coinbase account
To access their Coinbase account, first a user will need to securely sign in.

==*Securely sign in to your Coinbase account*==
==*Coinbase account succesfully connected*==

## Paying onchain directly from your Coinbase account 
Once signed in, users have the option to leave their wallet empty and pay for transactions directly with their Coinbase balance, eliminating the need to move funds between accounts. 

==*Now that Coinbase account is successfully connected, let's preview a transaction on moonwell.fi. Here we see the user only has $1.14 iin ETH in their wallet, but they need at least $3.10 for the transaction.*==

==*Because their Coinbase account is linked to their Smart Wallet, the user can opt to pay with their Coinbase custodial account instead.*==

==*The user can now confirm the transaction with the payment method set to Coinbase*==

Additionally, if the user has an insufficient retail balance in their Coinbase account, they have the option to purchase new assets on Coinbase directly within their Smart Wallet.

==*Within the settings of their Smart Wallet users also have the ability to buy crypto directly from Coinbase to fund their wallet.*==
==*Preview of the ability to buy new assets through Coinbase.*==

# For Developers: Integrating Smart Wallet and MagicSpend

Smart wallets support works the same way as any other EVM wallet. Developers don't need to write any custom code or call any special APIs; If you're using the Coinbase SDK or any standard wallet connection toolkit, you'll automatically get support for smart wallets. The MagicSpend paymaster is automatically accessible within Smart Wallet and requires no additional steps. 

:::warning
⚠️⚠️ However, because MagicSpend enables Smart Wallet users to use their Coinbase balances onchain, this means apps might not have all the balance information typically available to them by reading onchain data. Smart Wallet indicates that this is the case by responding to `wallet_getCapabilities` RPC calls with the `auxiliaryFunds` capability for each chain Smart Wallet users can use their Coinbase balances on.

If your app supports Smart Wallet and sees that the `auxiliaryFunds` capability is supported on a given chain, it means that a user might have funds available for use onchain on Coinbase. As a result, your app should not block user actions on the basis of balance checks.
:::

### Enable gasless transactions with the Coinbase Developer Platform Paymaster

Developers can also integrate the Coinbase Developer Platform paymaster to sponsor gas fees for their users, enabling them to interact with your platform without worrying about transaction costs.  For a limited time, the Coinbase Developer Platform is offering up to $15k in free gas credits on Base as part of the [Base Gasless Campaign](https://www.smartwallet.dev/base-gasless-campaign). According to Coinbase, gas credits should land within 1 week of submitting your form. More information can be found here: [https://www.smartwallet.dev/base-gasless-campaign](https://www.smartwallet.dev/base-gasless-campaign)

One of the most critical steps in the user journey is the onboarding process. You’ve already got the potential user to your site, now it’s time to convert them and get them using your product. Onchain, this starts with the user connecting their wallet. We’ve already covered how Smart Wallets enable onchain brands to quickly onboard new users, but just integrating Smart Wallet isn’t enough to fully optimize the user experience. 

## Adding a “Create Wallet” option for new users

New onchain users need quick and simple. Just using the traditional onramp of a “connect wallet” button is not optimized for new onchain users and can cause many to drop off. This would be the equivalent of having a “log in” button without a clear way to “sign up.” 

By also incorporating a “Create Wallet” button directly on your platform, you can streamline the onboarding process, making it seamless and efficient for new users. This simple addition can transform the onboarding experience, enabling users to set up their wallet and be ready to interact with your platform in just a few seconds.

==*Example of a "Create Wallet" button*==

## Smart Wallet “Create Wallet” Onboarding Examples

- DEX aggregator Matcha: [https://matcha.xyz/](https://matcha.xyz/)
- Yield infrastructure protocol Metastreet: [https://app.metastreet.xyz/earn](https://app.metastreet.xyz/earn)
- NFT collection: [https://www.basecolors.com/](https://www.basecolors.com/)
- AMM protocol built on BASE: [https://infusion.finance/swap/](https://infusion.finance/swap/)
- Web3 gaming: [https://cat.town/](https://cat.town/)

## Simplify your onboarding user interface

A simplified onboarding user interface reduces cognitive load and makes it easier for users to access your platform. This is particularly important for converting new onchain users who can be easily frustrated by the complexity of transacting onchain. 

An amazing example of an optimized and simplified onboarding UI can be found on [Infusion.finance](https://infusion.finance/swap/), depicted below. Note that while Infusion already has a “create wallet” button incorporated into their navigation, they have also included it within their “connect” feature. This ensures that no matter which route a new user takes to attempt to onboard, the option to create a wallet will always be clearly visible. 

==*Site: [https://infusion.finance/swap/](https://infusion.finance/swap/)*==

Alternative, turnkey wallet connection modules such as [RainbowKit](https://www.rainbowkit.com/) and [Web3 Onboard](https://onboard.blocknative.com/) also include options for users who don’t already have a wallet. However, unlike the straightforward user journey depicted above, if not optimized properly these options may introduce unintended friction into the user journey.

For example, RainbowKit’s “Get a Wallet” button (depicted below) leads users to a list of supported wallets that they can download. Many of these wallets require users to download either an extension or mobile app, record their seed phrases, and fund their account all before using your platform. This process can introduce a lot of complexity to new users who likely want to start transacting onchain but may lack the necessary confidence. If they don’t already have a wallet but are on your site, you want to make it as easy as possible for them to convert. 

==*Example of standard Rainbowkit.com wallet connection. New users have the option to "Get a Wallet" within the UI.*==
==*"Get a Wallet" button leads to list of wallets users can download.*==

Likewise, Web3 Onboard’s “I don’t have a wallet” option links to an unoptimized [Ethereum.org list of wallets](http://ethereum.org) that could easily overwhelm a new user looking to go onchain for the first time.

==*Blocknative's [Web3 Onboard](https://onboard.blocknative.com) gives the new users the option to find a wallet through the link "I don't have a wallet".*==
==*"I don't have a wallet" links to Ethereum.org list of wallets.*==

Prioritizing a clean, intuitive user journey is key to driving wider adoption and engagement for your onchain platform. While these wallet connection solutions work great at catering to traditional web3 users with their vast array of available wallets, developers can take steps to further optimize these interfaces for new onchain users by integrating Smart Wallet as the primary choice for users that don’t always have a wallet. 

# The future is onchain—Smart Wallets are how we get there

By enabling users to seamlessly integrate their Smart Wallets with their Coinbase accounts, MagicSpend is making it easier than ever for users to engage with brands across the web3 ecosystem. This ease of use is particularly important for onboarding new users who may lack the technical knowledge or confidence around funding and operating self custodial wallets. 

When integrated correctly, these products have the power to expand the reach of your onchain platform beyond just sophisticated web3 users. Smart Wallets have the power to be the next great unlock for onboarding the next billion users to crypto. I encourage any onchain developer to start exploring Coinbase Smart Wallet with MagicSpend today and revolutionize the way users interact with your project.

# Additional Resources

For further information and support, check out the following resources:

- [MagicSpend Guide](https://www.smartwallet.dev/guides/magic-spend)
- [MagicSpend GitHub Repository](https://github.com/coinbase/magic-spend)
- [Eth Research Forum on MagicSpend++](https://ethresear.ch/t/magicspend-spend-now-debit-later/19678)

:::success
Whether you need help growing your project or you just want to talk web3, let's connect!
Twitter: @thisisjoules
Email: hello@barragan[.]xyz

:::