SAFE to Launch: Overview of Tokenomics and Ecosystem

Overview

Launched in 2018, the decentralized custody protocol and digital asset management platform Safe (originally Gnosis Safe) is based in Berlin, Germany, with its slogan “Unlock Digital Asset Ownership.” The Safe Foundation is registered in Zug, Switzerland. As a digital asset management platform, users can transfer their assets (tokens/NFTs) to their Safe account smart contract addresses and conduct various regular on-chain operations via the many mainstream dApps integrated with Safe, achieving transparent management of assets on-chain.

The release of the Ethereum ERC-4337 standard has enabled wallet account abstraction (AA), becoming a mainstream narrative leading the crypto sector. Safe has gained the favor and endorsement of influential figures like Ethereum co-founder Vitalik Buterin and OpenAI founder Sam Altman. Safe combines the functionalities of a “smart contract wallet,” “multi-signature wallet,” and the concept of “account abstraction,” and is the absolute market leader in the DAO fund management tool sector, building economic moats through switching costs and cost advantages. Lukas Schor, co-founder of Safe, announced the SAFE token economic model in a governance forum in August 2022.

Token Economic Model

SAFE has a fixed total supply of 1 billion tokens, minted by the Safe Foundation:

• Users: 5% (50 million tokens)
• Ecosystem Members/Guardians: 5% (50 million tokens), with 25 million already distributed and unlocked, and another 25 million to be distributed over 4 years to future guardians.
• Institutional Investors: 8% (80 million tokens), starting to unlock on July 8, 2023, with a four-year vesting period.
• Safe Foundation: 7% (70 million tokens) with a four-year vesting period.
• Core Team Members: 15% (150 million tokens) with a four-year vesting period.
• GnosisDAO Vault: 15% (150 million tokens), starting May 1, 2022, with a four-year vesting period.
• SafeDAO Vault: 40% (400 million tokens) with an eight-year vesting period.
• Joint GnosisDAO&SafeDAO Vault: 5% (50 million tokens), already fully unlocked.

Note: The top 100 addresses in the Safe airdrop include marked DAOs/organizations (59 in total). During the initial period for users to claim the SAFE airdrop, out of 43,575 eligible addresses, 11,635 actively claimed their SAFE airdrop. Subsequently, the Safe DAO governance community voted to redistribute half of the unclaimed airdrop proportionally to those who had already claimed, allowing them to claim about 190.45% of the SAFE tokens from the initial airdrop plan.

Ecology at a glance

The ecosystem built on Safe is booming, and many projects have completed financing of more than 10 million US dollars.The underlying protocol/framework on which project “mini-programs” can be built and built, the Safe open source project code base is also giving back to the Web3 community, andBuild a network effect moat。

Safe Ecological Map (2023) Source:Safe

The cryptocurrency startup Multis, built on Safe, announced in February 2022 that it had completed a funding round of $7 million, led by Sequoia Capital, with participation from Y Combinator, Coinbase Ventures, MakerDAO, and others. In May 2022, the Web3 infrastructure startup Coinshift, supported by Safe, announced the completion of a $17 million Series A funding round, led by Tiger Global, with participation from Sequoia India, among others. Utopia, a DAO payroll system built on Safe, announced in June 2022 that it had completed a $23 million Series A funding round, led by Paradigm, with participation from Circle Ventures, Coinbase Ventures, and others. Subsequently, Utopia announced that it would shut down services on November 6, 2023, emphasizing that this action does not mean the company is closing but rather that it is abandoning its current product and direction. \
The phrase “Fat protocols, thin applications” suggests that protocols can create and capture most of the value driven by applications built on them, leading to a virtuous development of the Safe protocol ecosystem.

The choice of Buterin and OpenAI CEO

Ethereum founder Vitalik Buterin highly recommends multi-signature wallets

Ethereum founder Vitalik Buterin is a strong advocate of multisig wallets. If the mention of multisig wallets leads readers to think immediately of Safe, it indicates that Safe has successfully built an intangible asset moat in terms of brand recognition. On May 12, 2021, Forbes reported that Buterin transferred the vast majority of his Ethereum holdings, over 325,000 ETH (valued at over $1.3 billion at the time), to a new wallet address created using Gnosis Safe.

BlockBeats has previously reported that Buterin has recommended the use of multisig wallets on multiple occasions:

1.On August 15, 2022, he stated, “Hardware wallets are overrated, and most people should store the majority of their tokens in a multisig setup (with 5 participants) ensuring that the majority of the keys are held by trustworthy family members and friends.”

2.On November 16, 2022, he expressed a preference for social recovery and multisig wallets over hardware wallets and paper records.

3.On March 17, 2023, he mentioned, “Multisig wallets, like Gnosis Safe, offer a simple and secure way to store funds. Self-custody is very important, and both individuals and the Ethereum Foundation use multisig wallets to store most of their funds.”

source:Buterin Reddit

Sam Altman’s encryption project Worldcoin ecological wallet “World App” integrates Safe

Sam Altman’s cryptocurrency project, Worldcoin, integrated Safe into its World App ecosystem wallet, which also includes Uniswap, ENS, Circle, MoonPay, and Ramp Network. This indicates Altman’s preference for a pure account abstraction/cryptocurrency wallet.

source:Worldcoin

Conclusion

Safe is widely known as a “multisignature wallet.” However, the co-founders of Safe clarify that it is more accurately a composable smart account framework; a fully programmable smart account that can be used for any type of use case or user group through plugins. As a pioneering infrastructure in the new infrastructure track, Safe offers a wide imaginative space for ecosystem builders and stakeholders, with no direct market capitalization (MC) or fully diluted valuation (FDV) benchmarks available for comparison.

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