Coinbase has launched its "Embedded Wallets" tool, aiming to simplify wallet onboarding for developers and boost the capabilities of self-custody solutions, as DeFi gains momentum. This new tool is offered through the Coinbase Developer Platform (CDP). It provides developers with access to the same infrastructure that will power Coinbase's forthcoming decentralized exchange.
The Embedded Wallets tool targets developers across DeFi, gaming, payments, and Web3 social media sectors. It arrives as Coinbase has rebranded its own wallet into the "Base app," after its layer-2 network. The launch of Embedded Wallets aligns with Coinbase's broader strategy of on-chain finance and greater user control over digital assets.
Embedded Wallets gives developers access to the same infrastructure that powers Coinbase's decentralized exchange. The toolkit offers native rewards in USDC, the stablecoin issued by Circle. Users can earn a 4.1% APY on USDC balances held within the wallets without requiring staking. This APY can be retained by developers or passed on to users. The new wallet offers expanded DeFi features following the recent introduction of the GENIUS bill, introducing more clarity for stablecoins and DeFi. This allows end users to retain self-custody wallets with full connectivity features. The wallet will also expand the reach of Coinbase DEX directly through the developer package.
With the Embedded Wallets, developers can incorporate self-custodied crypto wallets directly into their applications. A key feature is simplified user onboarding. Developers can enable Web2-style logins like email, SMS, or OAuth, removing the need for users to manage seed phrases or download separate extensions. The wallets have direct access to the Coinbase exchange. For instance, websites can offer token swaps, offramps, onramps, and rewards through the Coinbase exchange. The wallet SDK enables developers to embed crypto functionality, including onramps and swaps, directly into applications. These wallets operate on the same infrastructure that supports Coinbase DEX accounts, offering enterprise-grade key management, compliance-ready architecture, and integrations with other Coinbase developer tools such as MagicSpend and Onramp.
Coinbase has launched its embedded wallets as a direct response to regulatory changes in the U.S. Following the passage of the GENIUS and CLARITY Act, more companies are ready to experiment with integrating crypto into their services. The CLARITY Act establishes a regulatory framework for the digital asset economy while guaranteeing self-custody rights, allowing users to hold cryptocurrencies without intermediaries. The legislation also recognizes the role of self-custody in enabling DeFi and peer-to-peer transactions, which are core pillars of crypto. Meanwhile, the GENIUS Act regulates dollar-backed stablecoins, creating potential pathways into DeFi and other crypto sectors via digital dollar rails.
The new embedded wallets offer all the elements used in Coinbase's own products. Native rewards bring 4.1% annualized on any USDC balance inside the wallet, with no extra steps for staking. Developers can choose to pass the earnings to end users or retain them to finance the project. The wallet will also offer MagicSpend, Swap, and data APIs. This allows developers to build a full-feature Web3 app without the need to stitch together multiple services. The wallet also keeps its encrypted private key secure while offering recovery backed by Coinbase, as well as support to export the keys and keep them in custody.
Coinbase Onramp customers can use Embedded Wallets at no cost until September 30, 2025. This limited-time offer aims to accelerate adoption during the beta phase.
