The crypto exchange is expanding its wallet-as-a-service offerings, addressing developers’ pain points when building Web3 applications.

oinbase is building two new wallet solutions focused on integration and balance transfer across Ethereum Virtual Machine (EVM) applications, targeting developers’ onboarding to its layer-2 blockchain Base.

Among the new solutions is a smart wallet that allows users to take their balances with them in different EVM-compatible applications integrated with the Coinbase Wallet SDK. The second feature is an embedded wallet that enables developers to incorporate noncustodial white-labeled wallets into their applications.

According to Coinbase, both features are designed to minimize developers’ pain points regarding user experience when building Web3 products.

“We’ve learned a lot from our customers in the past year, and we’ve been working a lot to improve the product experience of all of the service and where we’ve arrived at is the Embedded Wallets. So it’s been really a continuous effort for the past year,” Yuga Cohler, senior engineering manager at Coinbase Embedded Wallets, told Cointelegraph.

The move expands Coinbase’s Wallet-as-a-Service (WaaS) product line, a model that allows developers to integrate digital wallets into their own applications without needing to develop the core technology from scratch. This type of solution helps companies looking to incorporate digital assets into their products and offerings.

“Just to contrast this with the self-custodial wallet model [...] if you go to a DApp like Uniswap or OpenSea, you generally have to have a Chrome extension or you have to visit it on your own custodial app. [...] And so what we’re trying to do is provide APIs that allow these DApps to create wallets on behalf of their users, but still in a native way, so they don’t have to go outside of the DApp.”

Wallet-as-a-Service is a popular offering in the crypto space. Crypto exchange Bitgo, for example, has a similar service that includes custodial and noncustodial wallets available for enterprises.

Both Bitgo and Coinbase solutions are powered by multi-party computation (MPC) technology, which enables multiple participants to compute a result based on their private data without revealing it to one another or to an outside party.

“So this technology does not use smart contracts. The cryptography of MPC happens entirely off-chain. And it’s a protocol, there are many different MPC protocols. Coinbase has one that we use in-house,” explained Cohler.

Coinbase recently dropped support for native Bitcoin from its merchant payment platform, Coinbase Commerce, citing difficulties in delivering recent updates to its EVM payment protocol for Bitcoin.