Charles Esther
Safe, formerly known as Gnosis Safe, is a crypto self-custody company that has launched a new subsidiary called Safe Labs.
This new branch will focus on creating self-custody products tailored for enterprises.
Safe Labs is a commercial subsidiary fully owned by Safe, dedicated to building institutional solutions using Safe Smart Accounts, a modular smart contract wallet system.
Lukas Schor, co-founder of Safe and president of the Safe Ecosystem Foundation, emphasized the importance of digital sovereignty in Web3.
He said Safe Labs aims to provide infrastructure that is secure, intuitive, and designed for enterprise needs.
Rahul Rumalla, Safe’s former chief product officer, now leads Safe Labs.
Rumalla brings over 15 years of experience in engineering and product leadership.
He has founded Web3 startups like Paperchain and Otterspace, and previously worked as director of engineering at SoundCloud.
According to Rumalla, Safe Labs targets any business needing to hold or expose customers to on-chain value.
He also noted that many enterprises and institutions have already been using Safe’s products for years.
The new unit will allow Safe to develop more specialized and opinionated products for their clients.
Currently, Safe secures $60 billion in assets and powers around 4% of all Ethereum transactions.
It also supports approximately 10% of the Ethereum Virtual Machine smart-account market.
The Importance of Self-Custody
Self-custody means users keep full control of their private keys, which is crucial for securing crypto assets without relying on third-party custodians.
Institutional investors often add extra security by using multisignature setups.
These require multiple private keys to approve a transaction instead of just one, reducing risks.
However, many multisignature setups involve “blind signing” when using hardware wallets.
Blind signing means approving a transaction on a hardware wallet without fully verifying its details on the device’s screen.
This happens because some transactions use complex smart contract logic or custom data formats unsupported by the hardware wallet’s display.
As a result, users must trust transaction details shown on their vulnerable, internet-connected devices like computers.
This practice has caused significant security issues in the past.
For example, February’s $1.4 billion Bybit hack was linked to blind signing in the Safe suite.
Safe later released a post-mortem explaining the hack’s root cause as a compromised developer machine.
Binance co-founder Changpeng “CZ” Zhao criticized Safe’s response, saying it overlooked important questions about the hack.
Blind Signing Remains a Challenge
Safe’s new product, built on Safe Smart Accounts, offers modular smart contract wallets with multisignature management.
Despite improvements, it still requires blind signing for many on-chain interactions.
Fixing this issue will likely need collaboration between multisignature solution developers like Safe and hardware wallet makers such as Ledger and Trezor.
Ledger CEO Pascal Gauthier has acknowledged the problem.
He described blind signing as widespread but risky, comparing it to “signing blank checks online.”
Safe Labs’ launch marks a major step towards safer and more user-friendly enterprise self-custody solutions.
However, overcoming blind signing’s risks remains a critical industry challenge.
