Published on Mar 2, 2023

SafeTransfer — a foolproof way to transfer funds

Author: Kaushal
#Insights
icon-alt4 Mins
SafeTransfer — a foolproof way to transfer funds

There is a constant fear of accidentally sending tokens to the wrong address. It doesn't matter how many tokens you are sending or how many times you have done this before; your heartbeat slows down until the transaction is completed.

It’s very common to send tokens to the wrong address. And surprisingly, there is a method supported out of the box by almost every token standard that prevents this. Yet there’s hardly anyone using it.

This week, let's explore a project that has been solving one of the major problems in the crypto world.

The problem

Even though crypto is getting mainstream and we have started to adopt it, we have yet to become used to the entire process. For example, Even if you make a slight mistake while entering your wallet address, the funds are gone.

There are multiple ways you can lose funds. And we are not even talking about scams.

  • Selecting the wrong address
  • Sending funds to token contract addresses
  • Sending tokens to undeployed multisig wallets

It’s not just normal crypto enthusiasts who make such mistakes. Larger corporations send funds to the wrong addresses quite often:

  1. Crypto.com sent $416M worth of ETH to the wrong recipient. Got it back.
  2. Optimism sent $20M to the wrong address. They paid 2$M optimism token bounty.
  3. Typo Moves $36M in Seized JUNO Tokens to Wrong Wallet

Introducing: SafeTransfer!

SafeTransfer aims to make crypto transactions safer and foolproof. It allows users to transfer any ERC-20 token from one account to another.

Regardless of which mistake you are making — sending funds to the wrong account, multisig account, or anything else; SafeTransfer got your back.

SafeTransfer adds a second layer of confirmation while you are sending tokens. This layer enables safe and stress-free transactions of funds with an option to cancel the transaction if it is wrong.

The project is open-source on GitHub! That means you can see the code, suggest changes, and contribute by yourself.

The story behind SafeTransfer

One of the team members mistakenly sent tokens to the wrong address. Hence he and his teammates developed software that eliminates this problem. It went smoothly, and they also started using it for their everyday transactions.

When they gained trust in the software, they decided to present it to the community and make it public. They presented it in ETHNYC hackathon and won a prize from Gnosis Safe!

And now the same software is known as SafeTransfer! A side project developed to solve a personal problem is now used by over 500 people across the globe.

What makes them unique?

SafeTransfer is the only platform that does not add any third-party service. Anything that can be done by SafeTransfer can be done manually on EtherScan as well.

But SafeTransfer simplifies the process and abstracts all complexities in between. Because, after all, complexities could lead to confusion, and confusion could lead to loss of funds.

They don't even have any smart contracts as well! Also, it is one of the very few open-source projects available working on this problem.

How does it work?

There is no secret sauce that makes them special. It's the solution that they are providing.

Every token standard, like ERC-20, supports a safe method to avoid transactional mistakes. It is called approve-transferFrom. Here is how it works:

  1. Approve the transaction from your end. A link will be generated.
  2. Send the link to the recipient. Tell them to verify and confirm the transaction.
  3. If the recipient confirms the transaction, the funds are transferred. Else if there is any mistake, they can simply cancel the approval.

Unfortunately, not many wallets support this feature. And that's where SafeTransfer comes into the picture.

How to Safely transfer funds?

Let's get our hands dirty! We will see how to send and receive funds via Safe Transfer.

Sending funds through SafeTransfer

Go to the Safe transfer website and connect your wallet. Then select your network. Now put the recipient's wallet address. Finally, select the token and choose the amount you want to send.

Now you need to authorize the transaction. SafeTransfer asks only for authorization to transfer the amount and token you choose in the previous step. You can see this by clicking your wallet's Edit permission button while confirming the transaction.

Once you confirm the transaction, it will give you a hash and the link. You need to forward this link to the recipient.

The link is a dependency that might create a risk of losing funds again. But not in this case! You can restore such links by using the transaction hash given along with the link.

Receiving funds through SafeTransfer

You should have the link to receive funds. It's only possible to receive funds if you have the link.

Open the link forwarded by the sender. Connect your wallet and click receive.

And that's it! You will receive funds soon in your wallet.

Important note

SafeTransfer doesn't lock the assets in smart contracts. It only sets a limited amount of your token that the receiver can claim. You, as a sender, can revoke the token approval to cancel the allowance.

Future Possibilities

SafeTransfer already supports ENS domains. And they plan to integrate more partners. Currently, they are working with Avvy, with whom they will be integrating .avax domains.

There is also a SafeTransfer V2 version launching soon! It will allow senders to transfer safely without paying for gas.

Wrapping Up!

SafeTransfers is an open-source tool to transfer funds in a safe, foolproof, and reliable way. It leverages the approve-transferFrom method to safely transfer funds from one account to another.

We have launched SafeTransfer in this week's Launchpad! Check it out here now!

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