Leading U.South.-based cryptocurrency commutation, Coinbase, has integrated support for decentralized finance (DeFi) protocols on its wallet app.

Per a March 26 announcement, Coinbase Wallet will now permit users to earn interest on cryptocurrencies through the DeFi apps, Compound, and dYdX.

While the DeFi apps were already bachelor through Coinbase Wallet'due south built-in decentralized awarding browser, the commutation asserts that the integration significantly increases the ease-of-use for users seeking to access DeFi protocols.

The new feature will ringlet out for iOS this week, with Android support slated to follow in the virtually future.

Coinbase Wallet integrates support for DeFi protocols Chemical compound and dYdX

With the integrations, Coinbase Wallet will support lending for Ethereum (ETH) in add-on to a range of Ethereum-based tokens.

Both Compound and dYdX contain algorithmically-driven automated lending platforms congenital on acme of Ethereum, with dYdX also offering margin trading services.

While lending interest rates are floating, the annual returns offered by Chemical compound and dYdX ranged from 0.03% to 4.17% at the fourth dimension of Coinbase's proclamation.

Funds worth nearly $79 one thousand thousand are locked up in Chemical compound at press fourth dimension. DYdX's smart contracts currently manage more than $20 million.

The security risks of decentralized applications

The substitution states that the integrations volition allow users to earn interest on their crypto holdings in only a few taps, calculation that users can apace cash out by withdrawing their crypto from the DeFi smart contracts to their wallet.

Despite the company's optimism regarding the integrations, Coinbase urges users to do caution when exploring DeFi applications —stating that "DeFi lending apps are relatively nascent and come with risks."

"DeFi apps are programs running on the blockchain, and like any computer lawmaking they tin potentially accept bugs that cause you to lose coin. Returns are not guaranteed and your deposits are not insured."

ZenGo warns of major Dapp security vulnerability

On March 23, crypto wallet visitor ZenGo published a written report seeking to highlight a major security flaw in the interaction betwixt decentralized applications' (Dapps) smart contracts and crypto users' wallets.

The study asserts that when a user grants a smart contract permission to execute a unmarried transaction involving their wallet, the Dapp is granted full control over all of the tokens held within that wallet.

ZenGo also highlights that the authorization is permanent, meaning that even users who accept ceased to use a Dapp are still vulnerable to the flaw.

Cointelegraph reached out to Coinbase for commentary regarding the new integrations and the security flaws associated with Dapps. CT had non received a response as of press time.