Magic Wallet

Problem Statement

This project is awalletless, fiat-compatible cryptocurrency remittance solutionthat leverages cutting-edge technologies such asApple Face IDandPrivy Server Wallet. It’s designed to make entering and using the cryptocurrency world as simple and accessible as using a chatbot like ChatGPT. The platform ensures a secure, seamless experience for both crypto novices and experts alike, with multiple layers of security and ease of use.Here's a detailed breakdown of how the project works and what makes it innovative:1. Walletless Experience Using Apple Face ID and Privy Server WalletThis project revolutionizes how users access and manage their cryptocurrency. Instead of requiring users to go through traditional wallet setup processes, it eliminates the need for them to manage keys, seed phrases, or complex wallet apps.Apple Face ID Integration: Users can set up their wallet by simply scanning their face usingApple Face ID. This provides a seamless and secure authentication process. Once the scan is completed, the wallet is automatically created for the user without the need for any further input.Privy Server Wallet: The wallet itself is stored and managed securely on the backend via thePrivy Server Wallet. Unlike traditional wallets, this server-backed approach does not expose any sensitive data like the seed phrase to the user, reducing the risk of losing it or having it stolen. The wallet’s security is entirely managed by the server.Thiswalletless designallows the user to easily start using cryptocurrency without worrying about the complexities of wallet management, making it incredibly user-friendly.2. Effortless User Journey: Starting Your Crypto ExperienceThe project is built with the idea that users should experience cryptocurrency in the simplest, most familiar way possible. The platform mimics everyday apps like ChatGPT, making the process feel intuitive, even for users who are entirely new to the world of crypto.No Technical Jargon: The system operates in a way that makes the complex aspects of cryptocurrency, like swaps, private keys, or transaction fees, invisible to the user. The user interacts with a simple, friendly interface that asks only essential questions like "Do you want to send $X?".Getting Started with Ease: Just like chatting with a virtual assistant, users are guided through the process of setting up their wallet, buying their first crypto, and sending payments in a manner that doesn’t overwhelm them with technicalities.3. Fraud Detection Using On-Chain DataSecurity is at the forefront of this project. As users send funds, the system automatically analyzes theon-chain dataof the recipient to determine if they have a history of malicious activity.On-Chain Behavior Analysis: The system fetches the recipient's on-chain data (i.e., past transaction history) to detect suspicious or malicious behavior. If the recipient has been involved in fraudulent activity or is flagged as a risk, the user is notified.AI Fraud Prevention: The AI behind the system evaluates the recipient's address based on historical data, ensuring that the user's funds are being sent to a legitimate recipient. If any issues are detected, awarningorcautionmessage is displayed to the sender, allowing them to confirm the transaction before proceeding.For example,Frame 45(seen in the images) shows a potentialwarningfor "potential risk detected" when sending funds. This is a safety feature ensuring users are not inadvertently sending funds to malicious actors.4. Invisible Crypto ExperienceThe ultimate goal of the project is to make users feel like they’re just using an everyday app rather than engaging with the complexities of cryptocurrency.No Knowledge of Crypto Needed: The system hides all of the crypto-specific mechanics behind the scenes. Users don't need to know how blockchain works, what a gas fee is, or how to interact with decentralized protocols. Instead, the system takes care of these details, just like how a messaging app hides the complexity of SMS or email protocols.Seamless Interface: The flow of the app is designed to be as smooth as possible, with users simply interacting with a chatbot-like interface that asks simple questions and provides clear instructions. For instance, the app will automatically suggest an amount to send, verify the recipient's address, and send the payment without requiring the user to manually swap assets or choose which network to use.5. Seamless On-Ramping with Coinbase OnrampThe project includes built-in support forCoinbase Onramp, which allows users to easily convert theirfiat currency(such as USD or EUR) into cryptocurrency.Simple Fiat-to-Crypto Conversion: Through Coinbase Onramp, users can buy crypto using their traditional bank account or card in just a few steps, making it easier for those who are new to the crypto world to get started.Onboarding Made Easy: From thefirst screento adding funds (as seen inFrame 7), users can quickly add funds to their wallet via aQR codescan or by copying their wallet address. This makes it incredibly easy for new users to enter the world of crypto without going through the complicated steps of traditional crypto exchanges.6. Alerts and Risk Detection (Frames 44-50)The system is equipped with robustsecurity featuresto ensure safe transactions:Caution and Warning Alerts: The app provides real-time feedback on the status of a transaction. If a user tries to send funds to an unverified address or a suspicious recipient, the system issues warnings, like “CAUTION! This address has no records” or “WARNING! Potential risk detected”. These warnings allow the user to stop and double-check the transaction before proceeding, ensuring added security and preventing potential losses.Risk Report: If an address is flagged as suspicious, users are encouraged toreportit, further enhancing the security of the platform by crowdsourcing safety information.Conclusion:This project is set to radically change the way people interact with cryptocurrency by making it accessible, secure, and easy for everyone. The combination ofwalletless authentication,on-chain fraud detection,seamless fiat on-ramping, andinvisible crypto managementmakes this platform a highly user-centric solution.No crypto experience needed: Anyone can start their crypto journey with a simple face scan, like signing into any modern app.AI-powered fraud protection: On-chain data analysis ensures users are protected from fraudulent transactions.User-friendly interface: The system operates behind the scenes, allowing users to engage with crypto effortlessly.Seamless onboarding: Coinbase Onramp integration makes converting fiat to crypto incredibly easy, enabling even the least tech-savvy users to begin using crypto without hassle.This is truly a revolutionary approach to cryptocurrency remittance, designed for mass adoption by simplifying every step of the process while maintaining the security and integrity that blockchain technology offers.

Solution

1. Core Technology StackThis project is built using a combination ofmodern frontend and backend technologies,biometric authentication, andon-chain data analysis toolsto provide a seamless and secure crypto remittance experience.Frontend (User Interface & Experience)React 18 with TypeScript: The entire frontend is built usingReact 18, ensuring afast, component-driven architecture. TypeScript provides type safety, reducing runtime errors.Vite for Development: We choseViteas our build tool for its ultra-fast performance in development mode, allowing for hot-reloading and a superior developer experience.TailwindCSS: We usedTailwindCSSfor styling, ensuring aclean and responsive UIthat adapts seamlessly to different devices.React Router: Handles navigation, making the appsingle-page and smooth in transitions.Backend (Authentication & Business Logic)Express.js with TypeScript: The backend is powered byExpress.js, a lightweight and fast framework that enables easy API handling.MongoDB with Mongoose: We store user data, session information, and transaction logs inMongoDB, a NoSQL database optimized for handling large-scale applications.JWT Authentication: We implementJSON Web Tokens (JWTs)to manage user sessions securely.Privy Server SDK: This handleswallet operations, allowing us to offer awalletless experiencewhere the user's private keys and wallet management are done securely on the backend.Biometric AuthenticationApple Face ID & WebAuthn API:Users authenticate usingFace ID(on iOS) orTouch ID(on Mac and some laptops).WebAuthn API ensures that authentication is secure and tied to the user's device.No passwords are needed, eliminating phishing risks and improving UX.Blockchain & Smart Contract InteractionsCoinbase Onramp: We integratedCoinbase Onrampto allow users to convertfiat to cryptowith ease.The Graph Protocol:The platform fetcheson-chain transaction datausingsubgraph queries.It evaluatesrecipient wallet riskby checkingactivity history, transaction volume, and frequency.BaseChain for Transactions: Transactions are processed onBaseChain, ensuringfast and low-costcrypto payments.Coinbase AgentKit:This module helps detect and analyzepotentially malicious wallets.Identifies if the recipienthas been flagged in previous transactions.2. How The System Works (Behind the Scenes)The system functions in a highlyautomated manner, ensuring that all operations (from authentication to transaction validation) are smooth and user-friendly.Step 1: User Authentication & Wallet CreationThe user signs in usingApple Face ID.The systemverifiesthe biometric data using theWebAuthn API.Once authenticated, the system generates aPrivy Walletfor the user in the background.The wallet remainsinvisible to the user, withno need for private key management.Step 2: Adding Funds (Fiat Onramp)The user selects an option toadd funds.The system connects toCoinbase Onramp, allowing fiat to be converted into crypto.The user canpay via credit/debit card or bank transfer.Step 3: Sending Crypto (Transaction Flow)The user enters the recipient's address orselects a contact.The system automatically fetcheson-chain dataof the recipient.The AI-powered risk detection toolanalyzes past transactionsto identify potential fraud.The user is given asecurity rating:🟢Safe→ The address has agood history.🟡Caution→ The address haslimited activity.🔴Warning→ The address hasbeen involved in flagged transactions.The user confirms the transaction.The system calculatesgas feesautomatically (hiding complex blockchain mechanics).The transaction is processed onBaseChain.3. Challenges & Hacky WorkaroundsChallenge 1: Making Crypto "Invisible"Problem: Many users are unfamiliar with gas fees, blockchain transactions, and private keys.Solution: We abstractedall complexitiesby:Automatically estimatingoptimal gas fees.Managing private keys in thePrivy Server Wallet.Implementing achatbot-like UX, where users simply "send money" rather than "sign a transaction".Challenge 2: Fraud Detection on-ChainProblem: Identifying scam addresses in real-time.Solution: We useCoinbase AgentKit + The Graph APIto fetch on-chain data dynamically.Transactions arescoredbased on risk levels.A warning system isbuilt into the UI.Challenge 3: Fast Transactions with Low FeesProblem: High fees and slow transactions.Solution: Transactions arerouted through BaseChain, ensuring:Lower transaction fees than Ethereum Mainnet.Faster transaction confirmations.4. Partner Technologies & BenefitsWe leveraged several cutting-edgethird-party toolsto optimize security, speed, and user experience:|Technology|Purpose|Benefit to the Project| | --- | --- | --- | |Privy SDK| Wallet Management | Providessecure wallet handlingwithzero user friction| |Coinbase Onramp| Fiat-to-Crypto | Enables users to buy cryptoinstantly with fiat| |WebAuthn API| Biometric Authentication | Providespasswordless login, ensuringphishing-resistant security| |The Graph| On-Chain Data Fetching | Allowsreal-time risk analysisof recipient wallets | |BaseChain| Blockchain Transactions | Ensureslow feesandfast confirmations| |Coinbase AgentKit| Security & Risk Analysis | Detectsfraudulent walletsbefore transactions occur |Final ThoughtsThis project represents thenext evolution in crypto adoption. By making cryptocurrency transactionswalletless, secure, and as simple as a text message, we remove barriers to entry and make digital finance accessible toeveryone.This innovative approach means:No setup required→ Users can start sending crypto with just a face scan.Seamless fiat integration→ Users can buy crypto just like they buy apps on the App Store.Smart fraud detection→ Every transaction is checked for suspicious behavior.No technical knowledge needed→ Users don’t need to know what gas fees, seed phrases, or private keys are.This project isnot just a crypto wallet—it’s arevolution in digital payments.