Ornella Hernandez

The Coinbase Wallet now has an updated order preview screen that lets users simulate the outcome of a transaction on a decentralized application (dapp) before hitting confirm.



The wallet is a general purpose dapp not limited to interacting with the Coinbase exchange. The new “Transaction Preview” feature gives users an estimate of how their token balance will change once they buy a token or an NFT, based on a simulation of the transaction on the blockchain.



The company tweeted that the goal of this feature is to provide users with a “better understanding of how a dapp or smart contract will interact with your wallet” and “greater peace of mind.”



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">1/ By automatically simulating the code that would execute when you authorize a transaction on an EMV-compatible network, we provide you with an estimate of which assets will leave your wallet and any assets you’ll get back in return.&mdash; Coinbase Wallet (@CoinbaseWallet) <a href="https://twitter.com/CoinbaseWallet/status/1593375216293511168?ref_src=twsrc%5Etfw">November 17, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
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This feature may come in handy for retail users wary of bad actors in the space, given the amount of scams and frauds that have plagued the crypto world this year.&nbsp;



The recent <a href="https://blockworks.co/news/worse-than-enron-sbfs-ftx-has-a-complete-absence-of-trustworthy-information" target="_blank" rel="noreferrer noopener">FTX saga</a> is one in a string of events that shed a light on the risks of centralized finance, but those who self-custody can fall victim to fake investment opportunities and romance-linked fraud, if they’re not careful. 



Over <a href="https://blockworks.co/news/frauds-and-scams-top-1b-since-2021-ftc-says" target="_blank" rel="noreferrer noopener">$1 billion was traced in losses in crypto-related scams</a> between the start of 2021 and the first half of 2022. Most victims were targeted on Instagram, Facebook, WhatsApp and Telegram and then tricked into making transfers on crypto exchanges like Coinbase.



Ethereum wallet Argent also has a preview trade screen with a transaction summary, but Coinbase Wallet adds additional information for users, such as an alert if a URL is associated with a phishing attempt.&nbsp;&nbsp;



Auston Bunsen, co-founder of infrastructure provider QuickNode said the preview feature will make it &#8220;significantly harder&#8221; for hackers and scammers to steal funds from Coinbase Wallet users. He added that it &#8220;gives more visibility and power to users to protect their funds — making self-custody even more attractive in the wake of FTX.&#8221;



For institutional customers, Coinbase has another screening tool that helps mitigate the risk of transacting at scale. Called the Know Your Transaction (KYT) API, it enables clients to determine if an entity or transaction is facilitating illegal or fraudulent activity. It also generates risk scores for user addresses, using the <a href="https://blockworks.co/news/google-signals-major-crypto-push-with-ethereum-solana-support" target="_blank" rel="noreferrer noopener">Google Cloud</a>.



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Coinbase Wallet Feature Takes Aim at User Safety

Ben Strack

<div id="highlights-block_61b7b42b719c2" class="highlights">
 <ul>
 <li>Both banks will use Baton Systems’ Core-FX distributed ledger technology </li>
 <li>Technology allows the bank to settle funds on-demand with HSBC in more currencies than CLS Group allows, according to co-head of macro at Wells Fargo Corporate and Investment Bank</li>
 </ul>
 
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Wells Fargo and HSBC are using blockchain technology for the first time in the settlement process of cross-border payments.



The two financial services titans will jointly use a shared settlement ledger to process US dollar, Canadian dollar, British pound sterling and Euro transactions, the firms announced Monday.&nbsp;



The companies have plans to extend the platform to settle additional currencies and could choose to add more participants, introducing a central Financial Market Infrastructure provider.



The platform runs on <a href="https://batonsystems.com" target="_blank" rel="noreferrer noopener">Baton Systems</a>’ Core-FX distributed ledger technology.



Adopters of the technology are no longer restricted by currency-specific cut-off times and can agree with their counterparties on when and how often they settle. It allows for multiple settlements a day and a settlement process that can be completed in three minutes.



Riskless settlement, or payment-versus-payment (PvP) settlement, has previously only been achievable with legally enforceable settlement finality through <a href="https://www.cls-group.com/products/settlement/clssettlement/">CLS</a><a href="https://www.cls-group.com/products/settlement/clssettlement/" target="_blank" rel="noreferrer noopener"> </a><a href="https://www.cls-group.com/products/settlement/clssettlement/">Group</a>.



Market participants prefer to settle via PvP because the currencies are simultaneously settled — eliminating the risk of a firm having made a payment to a counterparty that then defaults on its obligations, said Alex Knight, head of EMEA at Baton Systems



But access to PvP settlement through CLS is restricted to CLS member firms and only available across 18 currencies, he explained.



“Today’s announcement means that all [foreign exchange] businesses can now access PvP settlement protection across all currencies,” Knight told Blockworks. “We’ve used distributed ledger technology to achieve this, delivering a level of transformation that’s well overdue.”



<h3>Traditional finance embracing the space?</h3>



Banks currently transmit files to CLS and then get funds settled the next day between accounts held at CLS, said Mark Jones, co-head of macro at Wells Fargo Corporate &amp; Investment Bank, adding that the funds are held up during the waiting period. 



“This new technology would allow us to settle funds on-demand with HSBC in any array of currencies we choose,” Jones told Blockworks. &#8220;[It] also provides greater visibility into transactions and funds flow because both of our operations teams at [Wells Fargo] and HSBC are utilizing the same dashboard at the same time.”



Large banks sharing technology infrastructure with shared transaction visibility is a new concept, the Wells Fargo executive added.&nbsp;



David Tawil, president of multi-strategy crypto asset fund ProChain Capital, said that banks that do not look to implement blockchain and accept cryptocurrency more broadly could be hurt over the long term.



“I know that right now it’s incredibly difficult for those banks to participate in cryptocurrency broadly because of the lack of regulation,” he said. “But certainly there should be education and development going on inside of those banks to be able to act and get involved once they are allowed to.”



Tawil argued that financial institutions should work together to figure out how they can use blockchain technology collectively to facilitate transactions and perform other processes across their systems.&nbsp;&nbsp;



“Right now the decentralized aspect of this is a runaway train without them,” he noted. “If they don’t have a pre-planned way to go ahead and transition to getting onto that locomotive, they certainly could be left behind.”



Knight said that Baton Systems is in discussions with nearly all of the large foreign exchange banks about its technology, noting that some are evaluating its impact on their businesses.



<h3>Continuing to adopt</h3>



Mark Williamson, global head of FX partnerships and propositions at HSBC, said in a statement that the firm will continue to grow its FX Everywhere network, which has settled roughly 3 million intra-bank trades worth about $2.5 trillion since it launched in 2018. 



HSBC also intends to position itself to be able to transact in new forms of regulated digital currencies, such as central bank digital currencies (CBDCs), he added.



Wells Fargo labeled cryptocurrencies as a “viable investment asset” <a href="https://www.wellsfargoadvisors.com/research-analysis/reports/rationale-cryptocurrencies.htm" target="_blank" rel="noreferrer noopener">in a report</a> published earlier this year. It noted that crypto could see continued growth, further compression in price volatility and a possible role as portfolio diversifiers over the long term.



“We are now utilizing blockchain technology, and expect that trend to continue to grow,” Jones told Blockworks. “As it relates to the crypto ecosystem, it’s clearly evolving fast and we are paying close attention to how the regulatory structure unfolds around it.”



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