What We Discuss With Tarun Gupta
While Safe (previously Gnosis Safe) has become the gold standard for self-custodial wallets, anyone listening who has previously used Safe, which requires the approval of more than one user for transaction execution, would often say that the user experience is sub-optimal.
Some of the examples of the recurring pain points using a Safe alone for approving multisig transactions are that only the safe signer can create a safe transaction or that transactions cannot be easily edited without canceling the initial transaction.
One company helping helps crypto organizations better manage their multi-sig treasury transactions on top of Safe, is Coinshift.
Coinshift’s mission is to simply on-chain treasury operations , whether for payments, reporting, and asset management.
On episode 49, I spoke to its Founder & CEO Tarun Gupta
- Episode intro (00:40)
- The story behind Coinshift (2:40)
- How Safe works (7:54)
- Pain points for users with Safe alone for multi-sig transactions (11:52)
- Overview of Coinshift (13:18)
- Thank you to our sponsor Cryptoworth (16:43)
- Onboarding with Coinshift (18:22)
- Pricing for Coinshift (21:36)
- Proposal on Coinshift v/s transaction on Safe (23:28)
- Most used chains & tokens (26:15)
- Financial reporting & asset management feature (27:17)
- Coinshift apps – CowSwap, Aave, LiFi, Request Finance (30:49)
- How CowSwap works with Coinshift (33:18)
- Integration with Request Finance (35:27 )
- Why use Coinshift in combination with Request Finance (36:44)
- Thank you to our sponsor Web3CFO Club (38:40)
- Positioning against competitors like Utopia Labs, Multis, Parcel (40:24)
- Account abstraction and onboarding the next billion of web3 users with Safe (44:37)
- Closing thoughts of Tarun (49:24)
- How to reach out to Tarun & Coinshift (51:03
[00:00:00] Umar: Welcome to The Accountant Quits, brought to you by the Web3CFO Club, a community of Web3 CFOs, sharing best practices on web3 operations. And Cryptoworth, a crypto accounting solution to help you automate your crypto bookkeeping. On this podcast, we discuss how blockchain will impact the accounting profession and how accountants should prepare themselves for the future of work.
[00:00:26] Umar: My name is Umar, your host, and even if some might refer to me as the accountant gone rogue, my job is to provide you with the blockchain knowledge you need that will be relevant for the accounting industry as a whole.
[00:00:40] Umar: Welcome to Episode 49. While Safe, previously Gnosis Safe, has become the gold standard for self-custodial wallets, anyone listening who has previously used Safe, which requires the approval of more than one user for transaction execution would often say that the user experience is suboptimal.
[00:01:00] Umar: Some of the examples of the recurring pain points using a Safe alone for approving multisig transactions, are that only the Safe signer can create a Safe transaction, or that transactions cannot be easily edited without canceling the initial transaction.
[00:01:16] Umar: One company helping crypto organizations better manage their multisig treasury transactions on top of Safe is Coinshift. Coinshift’s mission is to simplify on-chain treasury operations, whether for payments, reporting, and asset management.
[00:01:33] Umar: Essentially by modernizing treasury management, Coinshift intends to become the underlying infrastructure for the entire banking system secured by Safe. Since the MVP launch in June, 2021, Coinshift has already processed more than $225 million worth in crypto payments. And their clients include Uma, Zapper, Aave, EtherFi, Perpetual Protocol, Biconomy, InstaDapp and Links DAO.
[00:02:02] Umar: Today I have the pleasure to be speaking with its Founder and CEO Tarun Gupta. In this episode today, you will learn the administrative pain points of using a Safe alone for multisig transactions. What is Coinshift and how it facilitates treasury management? What is a proposal on Coinshift and how it differs from a transaction on Safe, use cases of clients using Coinshift, bookkeeping transactions from Coinshift and much more.
[00:02:32] Umar: Tarun, welcome and thanks for making the time to be here.
[00:02:36] Tarun: Hey Umar, I’m super excited to be here. Thanks for having me.
[00:02:40] Umar: To start, can you share a bit about your background, how you first became interested with blockchain and the story that eventually led you to co-founding Coinshift?
[00:02:50] Tarun: Yeah, I think like, what happened is, like in 2017, I got into the space around this ICO boom and it was just ending, the ICO boom was just about to end and I was just, you know, helping certain exchanges to run their Bitcoin RPC nodes.
[00:03:07] Tarun: Imagine like, you know, at that time it was like Bitcoin was the only thing, and as an engineer, I just wanted to help them to run their Bitcoin nodes. And then after doing it for like six months, I just read the Bitcoin whitepaper. And after reading that, I just realized, okay, this space is like quite welcoming for engineers like me.
[00:03:26] Tarun: And I shut down that consulting company and I dig deep into the Elliptic curves and all these things. Then I started sort of working on the Lightning Network. So Lightning Labs was just getting started early 2018, and I built like a library to help developers to build on top of that, like a Lightning app on top of my library at that time.
[00:03:46] Tarun: Did it for like six months, really good. Have like good respect from the core Bitcoin community and then. I was just thinking, okay, what are other problems I can solve, right. And at that time, a lot of people were losing their mnemonic phrases and you know, I just wanted to help and build like a system so that they can recover it in case of loss.
[00:04:05] Tarun: And I started digging deep into like multiple solutions like MPC, Shamir’s secret sharing and Multi-sigs. And I loved like how Shamir’s secret sharing works at that time. And I built like a social key recovery protocol, which was like multi chain at that time. And you know, you can recover your mnemonic phrases, you can add trusted devices, guardians, your mom or whatever, and you can recover in case of loss.
[00:04:28] Tarun: So the project name was CoinSafe at that time. And I did it for like one and a half year because it was a steep beer market we were not able to raise, and I just opened source that entire protocol. And then I met Aniket, who’s the founder, of Biconomy and you know, somehow you can say like Sandeep from Polygon and Aniket from Bioeconomy, they convinced me to work for Biconomy as sort of their first engineer, and I worked with the CTO there for like one and a half year. And we built like the entire gasless infrastructure for developers to extract gas fees. And during my Biconomy days, actually, we used to get paid in crypto and every single month our CEO used to ask us the addresses, paying to different individual addresses.
[00:05:13] Tarun: And I just thought, okay, like, you know, this can be, this entire experience can be improved a lot and sometimes accountings is being done on Slack, right. So it is, it is not very ideal and efficient for the CEO. So we participated in a hackathon by ETH Global Hackafest, organized by Protocol Labs and ETH Global, and we built like the first version.
[00:05:36] Tarun: At that time, the project name was called Parcel. When we built the hack, everyone just loved it and the hack was doing just one simple thing. You can do a mass payout very, very easily in multiple tokens in a single transaction. So imagine you have a lot of payroll solutions in Web2. Like Square payroll and others, and you can just, you know, in one click you can just pay to multiple employees, right?
[00:05:59] Tarun: But that infrastructure works very differently because you own the custody and you can, you know, really literally run like your payroll very easily. But when it comes to smart contracts, you can’t just take the custody, but you need to provide the same experience of running the payroll in a single transaction.
[00:06:15] Tarun: So we were the first one. You can say who provided this very efficiently than anyone else, and Juan Benet, The founder of IPFS and Protocol Labs just loved it and Consensys and Protocol Labs just, you know, reached out to us and we got like the first round of pre-seed and got into the Techon Accelerator.
[00:06:34] Tarun: So I co-founded Parcel in short after Biconomy with my co-founder and we worked together for like eight months. I was the COO of Parcel and our vision for the future of treasury management, you can say, or how the payment infrastructure will work, has like some kind of, you know, different opinions. And then we had a very professional kind of demerger with Parcel, and that’s all.
[00:06:59] Tarun: Coinshift kind of started in June 2021, where we launched our first version. We can go deep into that, but yeah, that is like the briefest history.
[00:07:08] Umar: Nice. So if we start with, before we dive into Coinshift, I wanna speak a bit the administrative burden for transactions on Safe basically. So Safe is an open source protocol and like I said in the intro, it’s the gold standard for building custody apps.
[00:07:24] Umar: It’s been battle tested and at the time of recording it holds around $30 billion worth of crypto assets. However, as I mentioned in the intro, the user experience for multi-six signers on Safe is not ideal. For example, only a Safe signer can create a transaction, but the Safe signer could rather delegate this admin test to another member.
[00:07:44] Umar: Right. So could you run us through some of these recurring pain points for Safe signers? I’m sure the listeners who use Safe will be familiar to those.
[00:07:54] Tarun: Definitely I would like to spend like two, three minutes on like how Safe works under the hood and what does their infrastructure look like and why we sort of decided even to build on top of Safe, right?
[00:08:05] Tarun: And what are those exact challenges we try to solve. So how we see it as like in order to build like the on-chain treasury management, there is a multi-layered stack for the end user in order to have an IDEAL treasury management on-chain. So on the base layer we call it, Layer zero, or you can say custody layer.
[00:08:24] Tarun: Where Safe has its smart contracts, right? And where actually the smart contract standard lies and where actually the funds are stored in a smart contract wallet. And then in order to interact with smart contract wallet, you need to have an off-chain infrastructure. So imagine, You are a 2 out of 3 multi-sig in a Safe, and now only one signer is available, other signers are not available.
[00:08:50] Tarun: So you need to create that off-chain signing experience and you know, asynchronous transaction creation process for these safe signers so that you know you can have a best transaction service. So this transaction service is called like an off chain transaction service, which is like built by Safe, right.
[00:09:08] Tarun: And this is one layer above the custody layer. And then, today, smart contract wallets, I always say it’s like wild animals, right? They can do literally anything. You can pull out the liquidity from Uniswap, do something with that, and do some batch operation because they can combine like any operation to any operation as long as it is under the block limit of the block space, right?
[00:09:32] Tarun: So, but when that to happen, you need to build your sophisticated gas limit engine as well, you know, have like the best gas limit. So this is also built by Safe basically. And, like the entire consensus engine. What will happen if somebody is rejecting the second transaction but approving the third transaction, right?
[00:09:50] Tarun: How the consensus will be achieved between all these signers in case of rejection. So Safe has this concept under, in contracts, it’s like on-chain rejection. So you’re paying for a gas fees if the consensus is not achieved, but you’re rejecting the transaction in that particular nuts. These are like some of the nuances I’m telling you in terms of,
[00:10:08] Tarun: How Safe works, and then they have their UI layer and where the user is actually interacting, right? So today, if you see Safe does not have any customer relation with their customers in terms of all the data is being stored on the browser, basically for all the devices, right? Only the transaction nonces and all these things are stored on the backend transaction service of Safe.
[00:10:35] Tarun: And they have done like an incredible job of providing this general purpose, you can say interface so that you can do anything with their smart contract. You can upgrade your protocol smart contracts with Gnosis Safe, smart contract, right? So it is just not built for financial use case. Financial use case is one of the use case of that, but it is built for so many things and that’s why if you see like Safe today wants to act as a,
[00:11:01] Tarun: Ownership kind of protocol, like a smart contract wallet standard rather than just a multi-sig treasury solution. Right. So once we realized these things like two years ago and we were like looking at lot of other smart contract wallets, Safe was like so modular and it is built for developers in a way.
[00:11:20] Tarun: You can build any use case you can imagine on top of it. And that was the reason we decided to say, okay, like let’s build on Safe smart contracts. But actually like, you know, we build like the V1 entirely on their off-chain infrastructure and safe smart contract. But last year we just realized like in order to build like the best treasury management use case, Safe off-chain infrastructure is not that sophisticated to provide a use case in which we can talk later, you know, what does that mean.
[00:11:50] Tarun: But this is how Safe works. And overall, like when you say like, you know, the burden of safe signers, actually the number one thing I would say is once the transaction is created, the other signers are not very easily say, this is exactly the transaction is going to happen. Obviously for ERC20 transfer, it’s quite easy, but when you’re doing a complex transaction, you can’t even say like, I’m approving this many, WETH, right, and then, I’m supplying this to Aave.
[00:12:19] Tarun: So like there is no human-readable decoded data for other signers. So imagine you’re signing like a million-dollar transaction, you don’t know. You just need to trust the first signer. This is the first burden we see, right? And the second problem is you need to have a Gnosis safe signer in order to create an on-chain transaction on the Safe UI.
[00:12:43] Tarun: There is one method actually in their API, which like a lot of people do not know is like delegate. So you can actually add delegate. Basically who can create this, but it just does not exist on the UI. But that delegate also going to create an on-chain queue transaction. And this is where like, you know, Coinshift has built some beautiful, amazing things, right.
[00:13:04] Tarun: So yeah, I think these are like some of the problems Safe signers face during execution.
[00:13:11] Umar: Alright, so let’s dive into the features of Coinshift. You’ve mentioned a bit the administrative bottlenecks when it comes to signing transactions. Could you tell us now a bit about what Coinshift is and how it actually facilitates the treasury management process for any crypto-related companies and DAOs?
[00:13:29] Tarun: Exactly. So with Coinshift, our mission is to like increase the financial health of organization. So we highly, highly believe in Coinshift as actually, you know, what is health for a human body is actually financial health for a company, right? And to make this vision happen, we need to set at the intersection of payments and expense management, reporting and accounting and asset management. And we are at the center. And once we are at the center, there will be multiple custody layers under the hood where the organizations are storing their crypto assets in self custody right? So a lot of these, if you see like VCs and others, store crypto assets and MPCs like Fireblocks or Coinbase, right?
[00:14:14] Tarun: But majority of the crypto organizations and DAOs, who are registered entities are storing assets on top of Safe, and that’s where basically we try to position ourselves from the last two years is actually building this entire off-chain infrastructure on top of Safe. We have our own indexing layer, we have our own decoding layer, we have our own consensus engine, we have our own gas limit engine.
[00:14:40] Tarun: And that’s why you will find when you’re doing some crazy batch through Coinshift, if you execute that batch outside Coinshift, you are going to fail that transaction because the gas limit is not properly, you know, calculated. So this is where Coinshift has built, like the off-chain infrastructure in parallel to Safe. And then we have the UI layer because we have our own infrastructure end to end, we can provide today the best experience for combining your multiple safes across seven chains in a unified dashboard.
[00:15:14] Tarun: And we have sort of, you know, decoupled the safe concept from the organization. So how Coinshift is trying to solve treasury management is, organization is a first class citizen, then the safe account. So tomorrow any number of accounts can be added in this organization, right.
[00:15:30] Tarun: And because organization is a first class citizen, you can add organization members into that which is decoupled again, from the account, right? So let’s say you have an account and you have an internal CFO. And let’s say you have a payroll admin and you don’t want that person to join the treasury account as a signer, but what you want is that person knows how payroll works and can initiate the payroll for the relevant signers.
[00:15:57] Tarun: So these are like some of the things we want to solve on the UX. So for the last two years, we started off with the mass payout, where very simply anyone, Even a nonce signer can initiate a mass payout or a crypto payroll to end number of recipients in end number of tokens in a single transaction. And the relevant signers can easily, you know, do a transaction and then you can categorize it at the same manner.
[00:16:24] Tarun: You can label it, you can put notes, right, and it really helps in the bookkeeping. Part of the things. So that’s how you know from starting out, from payments, we transitioned into bookkeeping and you know, we can talk about the reporting, which Coinshiftis getting big into. But yeah, I think these are like very specific things we provide.
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[00:18:17] Umar: Sure, we’ll dive into the different features in a bit by speaking also about your clients, I wanna speak about onboarding as well. So I noted that Coinshift is still in beta phase, right? You’ve launched V2. Is it still in beta? Because I mean you’ve already processed like some, so much, the volume of payments that you’ve processed is quite significant already.
[00:18:39] Umar: Could you provide us with a walkthrough to onboard like a client with Coinshift V2 and maybe some of the prerequisites that you expect these clients to already have at the time of setup?
[00:18:49] Tarun: Hundred percent. Just to answer your question, I think this is one of the debates internally, like, because we are like, you know, we are working with like hundreds of crypto organizations with such a large money, and we still call it ourselves, beta.
[00:19:04] Tarun: Actually it’s not a beta, it’s like a full production-ready product. It’s just that our expectations for the full production-ready product in terms of like compliance, data compliance, SOC compliance are actually saying like it’s a ledger on-chain treasury management solution, right? We don’t want to say a normal like, you know, app looks like an on-chain, fully compliant treasury management solution.
[00:19:26] Tarun: So that’s why we are in beta. But from a crypto-native experience, you’ll not find it, it’s not beta, definitely. And like regarding the onboarding process right now, it’s a self-serve model. So what we do is like, we have like very detailed documentation on the product. We really expect you definitely like anyone in the organization, even a non-signer can set up the organization.
[00:19:51] Tarun: We just need to white list that address. Basically to access the platform. So you can go to Coinshift.xyz, go to dashboard, apply for the waitlist, and we review it every single day. So we try to activate, you know, 10 to 20 organizations almost every day basically. So, and then sometimes treasury managers applied for that.
[00:20:11] Tarun: And once you apply for that and get the access, you go to beta.coinshift.xyz, and then you create an organization and we have an option if you have already existing safes, we auto-detect it. But if you want to add a Safe, which does not belong to you, we have a read-only safe you can add in that organization as a treasury manager and you can have a holistic picture across seven chains.
[00:20:36] Tarun: Right? So onboarding is quite easy if you own a Safe already, you don’t need to type and find your Safe. Basically, we auto-detect everything for you. And then once you create an organization, have your relevant signers, you can easily add your contacts, which you can say counterparties, right? You can create certain labels you want to attach to Coinshift, and then once the signers are there, you can just, you know, create like, transaction very, very easy. So onboarding is like quite easy.
[00:21:09] Umar: Yeah and I mean, while preparing the podcast, I did also sign up on Coinshift and honestly, like I strongly would recommend people who’ve been using like Safe for their multi-sig transactions. It’s a very smooth experience and it was very easy to onboard. And you do understand what is Coinshift like once you use it, you understand completely what’s like the difference between Safe only and Coinshift. It was a great experience.
[00:21:36] Umar: Now speaking about pricing, right now, Coinshift is free, right? So users, they only need to pay for the gas fees for transactions associated with Safe. Will this at some point change in the future?
[00:21:48] Tarun: Hundred percent, yeah. That’s why I think another reason we are in like beta, we are actually working very, very closely with all these users to really build like a great sophisticated monetizable product.
[00:22:00] Tarun: Right. And what does that mean as like to access the dashboard, we’ll have some SaaS kind of model, right? Depends on like how big is your organization? We are still figuring it out, What is that value metric where we want to charge. But yeah, we are building like hands-to-hand with these users and they’re like guiding us.
[00:22:17] Tarun: So that’s why we are moving towards like reporting and automated kind of, you know, bookkeeping and accounting. And that’s where we, we know like people are like very, very willing to pay and it has like a huge value. And I can even commend like why Coinshift will be uniquely positioned to sort of provide like the best, you know, bookkeeping experience there.
[00:22:38] Tarun: So yeah, it’ll be a SaaS model in the short term you can say. But end of the day, we are a treasury management solution, right. And the next big bet for Coinshift would be like in the asset management world, where we really want to provide like very sophisticated, delegated permissioned asset management on top of safe.
[00:22:55] Tarun: And that’s where basically you can imagine like, you know, we can have like a performance fees and all other things tomorrow even we are sort of thinking to like we are launching something beautiful tomorrow in terms of swap. So we might have some revenue model there as well. So some here and there like unique like fees where we are actually providing like the experience.
[00:23:18] Tarun: Right for certain operations, like asset management, swapping or bridging. But overall like accessing the dashboard is like the first revenue model will be coming up soon.
[00:23:29] Umar: I wanna speak a bit about, which I think was the first core feature of Coinshift about payments, so about proposals. So in order to send payments through Coinshift, the user must first create a proposal, which in Safe would be equivalent to creating a new transaction.
[00:23:44] Umar: So with Safe, I said like, only a safe signer can create a transaction. But with Coinshift, any member of the organization, which has been added to Coinshift can create that proposal and effectively reducing the workload on signers. Can you walk us through the steps of creating a proposal, approving the proposal, and what are the fees actually incurred?
[00:24:06] Tarun: Yeah, so you can think of proposal as one more layer on the option infrastructure, I explained in the beginning, The main reason for building this proposal system is to actually, as you said, like can non-signers can offload the burden of, you know, putting the data, how much this person is going to get.
[00:24:26] Tarun: If you have new person joining the team, you need to add that data, right. So this is actually the job of payroll admin or HR admin, and that’s why we wanted to scale treasury operations when your organization scales, but not adding all those members, finance team members into the safe signing. And that’s why proposal, we are almost like, you know, invented at like last year and it’s like a full infrastructure in-house.
[00:24:52] Tarun: And what does it mean is like, You just go to Coinshift, choose new transfer, and then when you select your safe across seven chains, you can say, okay, mass payout, you can do everything basically you want to do with the transaction, but you’re not allowed to sign that basically. So you can create a proposal and then the relevant signers can come to the platform and they can say, okay, whether this proposal is eligible to go into the transaction queue or not.
[00:25:21] Tarun: Right. And if sometime actually it happens. So let’s say you create five proposals rather than five transactions with the nonce. So the nonce is not as assigned to the proposals, right? So you have five proposals created by an internal team, and the relevant signer or the founder or CFO can come up and can say, okay, this middle proposal I don’t want to, you know, I want to reject it.
[00:25:43] Tarun: So it’s like an entire, you know, very seamless process. Like one click, reject. But we also have discarded proposal section as well, so that you can see who rejected what, just for the auditing purposes, right? And that’s how everyone today in our user base.
[00:25:59] Tarun: So it is the single most like highest loved feature, I would say, for the app, which is being used every single day. Being of you know, B2B FinTech company, you can say still we are being used like every single day, like this specific feature.
[00:26:15] Umar: And just in terms of usage, what’s the chain and token being used like the most with Coinshift?
[00:26:21] Tarun: Yeah, so it highly depends, but if you say like the majority is definitely USDC because end of the day, we are a solution who helps you, you know, people pay right to other, other recipients. And USDC is like the preferred choice, but we also have organizations who have like their native tokens, right?
[00:26:44] Tarun: And that’s why if you see in crypto as a crypto organization, you have needs in terms of, you know, you want to pay to people. You also need to close your books because the assets you are holding in your treasury are also volatile basically. And that is very, very independent from the payment system, right?
[00:27:05] Tarun: So that’s why Coinshift has introduced certain, you know, features related to reporting and all that so that you can target like both the segments, very sophisticated.
[00:27:14] Umar: Okay. We can speak about those other features. So like I mentioned in the intro, Coinshift has already processed $225 million worth of crypto payments with clients like, Protocol, Uma, Biconomy, Zapper Aave, the list goes on.
[00:27:31] Umar:.So, so far we spoke about the improved user experience with safe signers. I also want to touch on the other feature with Coinshift, the portfolio history and asset management feature. Which enables companies basically to have a complete view of their entire treasury, regardless of Safe or chains.
[00:27:49] Umar: Could you walk us through this feature and if possible provide an example of a company that uses this feature?
[00:27:56] Tarun: A hundred percent. So yeah, so we call it like financial reporting in the world of blockchain, right. How will you do financial reporting? So we have like three main things today that exist on Coinshift, basically, you know, where you can just have your entire consolidated reporting.
[00:28:11] Tarun: The first one is like actually live portfolio where you can just combine your entire treasury across like seven chains we are available on. And you can see like a holistical picture, you can see by accounts exactly like very, like it is designed for treasury managers to see that. So live portfolio is one.
[00:28:30] Tarun: Then three months ago, we introduced this like, you know, our first feature of our in-house indexer and decoder, which is portfolio history. So what does it mean is you can go back to history for hundreds of addresses tomorrow. Our engine can support like literally end number of addresses across end number of chains.
[00:28:49] Tarun: And you can say in June 2021, this was my exact token with the USD price with a five minute granularity on that date. Just imagine, right, you know how amazing this is. And this feature is, actually, we were not building it. So some user, like one of our user, Perpetual Protocol, they were just doing it for month-end closing every single month.
[00:29:16] Tarun: So when you want to do a month-end closing, you actually need to say like, these are my holdings, basically, right? And then you go to your transaction history and go to Etherscan and match it basically like these are the net flow and this is exactly my token balancer is right, and there are a lot of discrepancies between these two because the prices are very, very different.
[00:29:39] Tarun: And any organization today, who holds crypto treasury assets specifically like volatile assets, right. They need to do it because that’s how their history looks like. Right. And that’s where, you know, they just told us like, can you help here? And because we are having our own indexer, we just did it like in couple of days as an API.
[00:30:01] Tarun: And for, for like four months before we ship it into production, we were just building hand to hand with them and they just saved their entire, like, you know, week of time to just, they just say, okay, these are our addresses. Just give us the history for the last month. And we were building their Excel sheet manually you can say through our API.
[00:30:20] Tarun:. That’s how we try to understand where we are doing wrong, what is exactly they need, how much auditing they need. Even you can have an Oracle price where, okay, it’s Coingecko, right? And then you can have, this is a block number, what are the things they need? And then just it’s, it’s a matter of like building it in the UI.
[00:30:37] Tarun: So as I said, like lot of users are actually using it. It’s not only Perpetual Protocol. So we always thank Perpetual Protocol to bring this to us. And I think like more than 50% of the Coinshift users use it for month end closing.
[00:30:49] Umar: Now speaking about the dapps and integration of Coinshift, you do support like a lot of Dapps the likes of Aave, CowSwap, LiFi.
[00:30:59] Umar: You’ve integrated Superfluid for streaming. You have the latest integration with Request Finance, the application for crypto invoicing and payroll. Maybe you can go through some of these dabs and how it works using Coinshift. So if I’ll take Cowswap for example. So Cowswap is a Dex aggregator. It has a limit order feature which allows users to control trading prices.
[00:31:23] Umar: Could you explain how this works and how it’s useful in a multisig model like Coinshift where not all signers would be available at once?
[00:31:30] Tarun: So what I would say is like, you know what we did with the Safe smart contracts like two years ago to build like the entire system on top of it, right, which I explained.
[00:31:41] Tarun: So we are taking like a giant leap again to build something very beautiful on top of safe apps SDK. So if you have ever interacted with Safe UI, there is a Safe app concept, right. And how does it work as like it is built on top of Safe apps SDK, which combines the iframe kind of experience within the safe UI.
[00:32:00] Tarun: So tomorrow we are launching, basically on 18th August, we are launching Coinshift apps, which is like a very similar concept, but it is turbo boosting the entire Safe app experience by our second product of our in-house indexer and decoder, which we are calling it like Decipher. Which means like actually when you’re interacting with Safe apps, you can see very clearly human-readable sentences and what exactly you are doing.
[00:32:30] Tarun: And when the other signer will see that transaction, you can easily say, okay, this is the exact operation I’m doing. So today what happens is when your organization scales. You want to add few more treasury managers or or finance team members, but also you want to interact with DeFi. Maybe you want to rebalance your treasury assets.
[00:32:49] Tarun: You want to do a lot of invoicing. You want to even run a payroll on Arbitrum, right for low gas fees, but you want to keep your main treasury assets on Mainnet. How will you have the best seamless experience by combining the entire concept infrastructure? Plus you can do these things. So till today, there is no interface for these users to combine this with the Coinshift UI.
[00:33:15] Tarun: And that’s why we are coming up with this launch. And specifically speaking about the Cowswap. So if you know Cowswap as like has a system of off-chain relayers, what does it mean as like, It is like, you know, trying to create a similar experience as your centralized exchanges are with the market making where you can just say, okay, I want.
[00:33:37] Tarun: To buy this at this price, basically, right? And then the exchange will fill the order with the right liquidity. So cost swap is built on a very similar model in a decentralized manner. So you can create these similar limit orders as an off-chain sort of signed messages. And then they have this concept of coincidence of wants.
[00:34:01] Tarun: Think of it as a barter system, not like exact barter, but you can think of you need this, I also need this. Let’s exchange directly why we need to go to the LP, just like we do in the real world as well, right? So they first prioritize that. Then if that does not match beautifully, then they go to on-chain aggregation of the liquidity.
[00:34:22] Tarun: So that’s why their architecture is very beautiful. And imagine if you don’t use Cowswap, what are the problems for multi-sig signers? So actually, when you need to create a transaction, let’s say you are using Uniswap, you need to sign the nonce as a multisig, and you need to tell, okay, token price and everything.
[00:34:40] Tarun: And actually you are defining like these many tokens I want to do right? And this is what the USDC I need. But what will happen if the market changes, right? So the price of the trade is not actually calculated during execution, and that’s why there is a fundamental need of a solution like Cowswap for Safe users, right.
[00:34:59] Tarun: But it is already being done by Safe UI as well. We just want to provide like a 10x experience on top of it. And if you see the stats today, like almost $50 million per week is transferred or swapped using Safe plus CowSwap. So they’re actually gaining that transaction, like very, very good traction and 1Inch is another solution.
[00:35:21] Tarun: But in the first go we are coming up with CowSwap. I hope it makes sense.
[00:35:26] Umar: Yes it does. I’m also excited to see the integration with Request Finance more on the payment side. We’ve had Request Finance on this podcast before, people would be familiar to it. Could you explain like how the integration would work with Coinshift and why you decided to basically integrate Request Finance?
[00:35:45] Tarun: A hundred percent. So as I mentioned, like we started off with the payments, right? And now we are going big on reporting. So the third segment I mentioned as I didn’t mention as like other than portfolio history, we are also coming up with cash flow reporting where you can easily see your cash flow, right?
[00:36:00] Tarun: This is the net flow. Combining with the portfolio history and you can close your month-end very, very fast, if you combine these two experiences, as I said. To go big on reporting, we can’t go very, very big on payments, at least for certain time. And because it is like, you know, it is that time of the industry where you need to build the infrastructure first, then you provide the experience.
[00:36:22] Tarun: And we have been in touch with Request Finance basically for the last, since my Parcel days, you can say, and you know, they have executed very, very well on the payment side of the things. And we highly respect how basically big they are in terms of payment space. And they focused on this niche and they’re the market leader in that.
[00:36:44] Tarun: So there are a couple of users who use CoinShift, right? And then they use Request Plus Gnosis UI, right? And. Because like it is, it makes a lot of sense for the Request users who are using Gnosis UI, they should use Coinshift plus Request. So now you can go to Coinshift, go to Request Finance, right? And you can say, InvoiceMe or whatever you want to do with the invoice.
[00:37:07] Tarun: But your entire custody layer is Gnosis Safe, which is being managed through Coinshift with all the powers it has. Right? And that’s how it is like a deep integration. And even like, you know, if this works out very beautifully, we want to enable even a core integration with the Request Finance, right? So you have an invoicing feature, powered by Request Network, right in Coin Shift so that we can combine these two worlds basically seamlessly on Coinshift.
[00:37:32] Umar: Yeah, that’d be beautiful because right now, so for Request Finance users, let’s say they’ve signed up on Request Finance also, they’ve signed up on Coinshift. The invoice, let’s say, has been approved for payment on Request Finance, and then they’d have to go on Coinshift, make payment, and then probably it syncs to Request Finance, right.
[00:37:55] Tarun: Exactly. So I think like one additional part is today also you can fulfill the batch payout of Request Finance in terms of invoicing through Safe. But what is not happening today is actually is you can’t see how much you are paying to an individual in that invoice as a batch. And this is where the powers of our decoder comes.
[00:38:16] Tarun: So everything you can do today with Safe and Request you’ll be able to do with Coinshift plus Request. But what is the superpower is actually seeing exactly how much you are paying and, and then details. And then you can add categorization. Tomorrow, you can imagine we can combine the categories with Request, right?
[00:38:34] Tarun: So it auto-syncs between two apps. So this is like a clear differentiator, what exists today.
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[00:40:23] Umar: Beautiful. Now I wanna speak a bit about your positioning. There’s a great number of companies building on top of Gnosis Safe tackling multisig Treasury Management, the likes of Multis, Utopia Labs.
[00:40:36] Umar: I mean Parcel. You’ve previously worked at Parcel, but how does Coinshift differentiate itself from other treasury management solutions currently available? I mean, you’ve already shared the beauty of Coinshift.
[00:40:48] Tarun: Yeah, for sure. And I think the number one thing I would say is like, you know, we all are trying to work together in a way where basically this on-chain world of banking and treasury infrastructure needs to build from the ground up on a new system which is Gnosis Safe.
[00:41:07] Tarun: So I love, like, you know, all these players actually alongside us are building that experience, right? But how do we position ourselves for the end user?
[00:41:17] Tarun: So first of all, I’m very positive for the end user because like they have multiple, you know, interfaces on top of Safe. And sometimes it happens, you know, one interface is down, can you use another interface so that I can process my payment, right. And that’s where Coinshift actually positions itself beautifully.
[00:41:37] Tarun: So today, if you interact with any interface, majority of these interfaces have Gnosis Safe off-chain infrastructure integrated into their system. And where Coinshift differentiates is an alternative off-chain infrastructure as well. But we do sync with the Gnosis UI as well for the signers. So if you initiate any transaction from any interface, you can actually categorize it on Coinshift.
[00:42:02] Tarun: So imagine your payroll admin is running a payroll on X app, right. And as your bookkeeper, basically I can tag it on Coinshift. And I can execute it on Coinshift, right? With the right gas limit and all that. So this is like the first clear differentiation we try to have with this. We say in like crypto, like you know, pluralism to the standard implementation.
[00:42:23] Tarun: So it’s another implementation, which is an alternative to you, right? In case of single point of failure. That is the first part. The second part is like, We are heavily, heavily, heavily going deep into complex treasury management, right? So we highly believe, okay, like as a startup, maybe seed stage you have 5 to 10 transactions across like two chains, right?
[00:42:46] Tarun: The treasury operations are not very complex, but when it comes to Aave’s of the world or, or like, you know, Perpetual Protocol and others, they are like real, you know, like very, very big treasuries, multiple entities and you know, they want to manage across their entire processes, right?
[00:43:03] Tarun: And that’s where Coinshift shines because of its entire consolidated interface, right? And we have our own infrastructure. So as you go, very, very complex. You need these kind of needs, which Coinshift provides and obviously as a smaller organization also, Coinshift has like very much designed for that.
[00:43:20] Tarun: We as Coin Shift, we are also a Series A startup, right? We also use Coinshift. So yeah, I think this is like the short-term differentiation or positioning. But the long term differentiation and positioning is basically, as I mentioned, we want to sit at the intersection of payments, reporting, accounting, and asset management.
[00:43:39] Tarun: And today we are trying to work with some players who are actually doing delegated asset management. And I don’t want to reveal the names. We’re actively going very, very deep into, you can say delegated asset management. And imagine you want to say, okay, I want to do portfolio management with this asset manager, but this asset management manager is only allowed to do specific operations from the Safe, right?
[00:44:06] Tarun: So you’re not giving the custody, but they’re still providing the delegated asset management. This is where like our architecture is very beautiful to support these things and with Coinshift apps, the possibilities are endless. Imagine you can combine the experience of any web2 app directly interacts with Coinshift, right?
[00:44:24] Tarun: Because you can build literally any application which works inside Coinshift. So we are just getting started and we really see ourselves as becoming like the defacto of on-chain treasury management.
[00:44:36] Umar: Beautiful. Now Tarun, for the last topic of the episode today, I wanna speak a bit about account abstraction and how you see the future of web3 basically.
[00:44:43] Umar: So the promise of account abstraction is to onboard the next billion of users into web3. So we can’t imagine the average person to have the time and patience to get to grips with wallet seeds, or expecting them to embrace crypto if they know losing their private keys means they lose access to their wallet funds.
[00:45:07] Umar: Also are people willing to pay a gas fee for every transaction on a smart contract blockchain? So account abstraction alleviates all of that and makes it easy for new users to start using crypto without ever having to worry about complicated seed phrases or the process of setting up a wallet. And Safe is kind of trailblazing the account abstraction domain.
[00:45:29] Umar: Can you paint us a picture of how you see people interacting with Safe in the future? Essentially like Safe becoming the bank.
[00:45:36] Tarun: Hundred percent. I think first of all, this account abstraction, you know this concept of working with smart contract wallets, has been the concept from the last, you can say four or five years, and Safe has already done like an account typical like account abstraction thing with their smart contract wallet is just that.
[00:45:57] Tarun: It is their implementation, which is not following basically this ERC, like, you know, 4337, and all the users of Safe are actually, if you see right, they use EOAs for signing stuff on Safe. But the actual custody holds into the, you know, Safe account.
[00:46:16] Tarun: And this is a similar concept done by InstaDapp as well with their smart account system when you’re interacting with DeFi. and then MakerDAO has also like, you know, DSA proxy in the early days. So this concept of smart contract wallets has been existed from very long. And even if you see like Argent is also a smart contract wallet.
[00:46:34] Tarun: But now what is happening is with this ERC, we are saying basically don’t use, you know, EOAs for storing crypto assets. So a lot of the crypto users just store crypto assets on EOAs, right? And we don’t want to do that as an industry to store large amount of assets on these EOAs. And that’s why Ethereum, you know, proposed this EIP.
[00:46:57] Tarun: So that, can you just, you know, from the fundamentals of implementation, you can say hold only smart contract wallets and then use your EOAs for recovery, for adding 2FAs, for doing some kind of, you know, signature verification process for certain thing, right? And that’s how we are abstracting the account from this, you know, signing process, you can say this is the first fundamental thing which is happening, right.
[00:47:23] Tarun: With the account abstraction. So the other thing is imagine today you go, you use your iPhone and you have this, you know, iPhone also has like key chain, right? You do with your face ID and encryption, decryption happens through your face ID directly.
[00:47:39] Tarun: So imagine you can support these kind of signatures specifically, you know, with certain smart contract wallets, and you don’t need actually seed phrases, right? So you have like end of the day these signatures. What is their signature, right? It’s an entropy. With a very unique information, which you can say, only you hold that, right?
[00:47:58] Tarun: So you’re abstracting basically, you know, this entire experience. So tomorrow I can see the world of, you have wallets, but you’re not having any seed phrases. So your authentication is your face ID. And maybe if you want another guardian, you have one, right? So this is the future of this account abstraction, and this is where we are having more security.
[00:48:20] Tarun: But providing the best experience, which we are called like banking experience. Right. And I think it is much advanced and secure than all banking systems we have today. So, I’m very bullish and even I’ll just tell you like while working with Biconomy, we build the other side of the account abstraction.
[00:48:38] Tarun: So account abstraction has this one side of abstracting the accounts from EOAs, but the other side is actually doing the gasless transaction, right. So I build that entire infrastructure and Biconomy with the CTOs specifically focusing on, you know, these can say, today we call it like bundlers and you know, paymasters, but we built that without even, you know, this EIP. So previously it was like Safe plus by Biconomy, Safe plus Gelato.
[00:49:03] Tarun: Now with this ERC, everything is like combined and everyone can have a standard implementation.
[00:49:09] Umar: Tarun the time has passed fast. We’re already coming to the end of the episode. As closing thoughts, has there been anything that maybe we didn’t touch on that you’d like to share with the listeners? Or would you, like to wrap up this episode in a few sentences.
[00:49:24] Tarun: Yeah. First of all, I love this podcast. I listen it a lot and you’re doing amazing job here. So, for the listeners, I’ll just say one thing as like, you know, it’s just a matter of time when this entire liquidity from fiat currencies will move into sort of, you know, on-chain liquidity. And once you have on-chain liquidity, you need to manage it through some software or some platform, right?
[00:49:48] Tarun: So Coinshift is building that entire end-to-end on-chain infrastructure, which is heavily focused on this treasury management, right? But there will be couple of infrastructures which will come to manage this. So it’s a big opportunity and we are one of the players who are into this opportunity.
[00:50:07] Umar: There’s a last question, which I like to ask to my guests before they leave is, do you have a favorite quote or a maxim that you try and live by?
[00:50:15] Tarun: Yeah, for sure. So I think, I truly believe from very early days of my startup journey, like I started my first startup in 2015, third year of my college and I think like I highly believe in like creating like impactful, positive-sum games.
[00:50:32] Tarun: I just feel like it creates a beautiful flywheel, right? So you want to motivate people, but actually when you create a positive sum game, you actually motivate yourself and in the entire sort of, you know world, in a way where if becomes successful, all the employees become successful, stakeholders become successful, right.
[00:50:52] Tarun: And then it creates a beautiful positive sum game for everyone. So, yeah, I highly believe in that.
[00:50:58] Umar: Perfect, well, thanks a lot for coming today, Tarun. If people after this episode they want to reach out to you personally or learn more about Coinshift, where should they go?
[00:51:09] Tarun: Yeah, so follow us on Twitter and I’m available on tarungupta1475, and Coinshift has oxcoinshift, you can DM me.
[00:51:16] Tarun: If you want to have the access, just let me know. I will immediately give you the access.
[00:51:23] Umar: Perfect, well thanks a lot for your time, Tarun, it was great. Personally just for me as well to learn about how treasury management works with Coinshift and I hope it’ll be like very helpful for our listeners.
[00:51:34] Tarun: Thank you.
[00:51:35] Umar: Thanks, and we’ll speak soon.
[00:51:36] Umar: I would like to thank everyone for listening to this episode. You’ll find all the links of the episode show notes and transcript on the website of The Accountant Quits at theaccountantquits.com. Please note that this content is for general information purposes only and is not a substitute for consultation with professional advisors.
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