diff --git a/src/components/auth/LoginArea.tsx b/src/components/auth/LoginArea.tsx
index 4663d99..fbdd988 100644
--- a/src/components/auth/LoginArea.tsx
+++ b/src/components/auth/LoginArea.tsx
@@ -58,6 +58,10 @@ export function LoginArea({ className }: LoginAreaProps) {
         isOpen={signupDialogOpen}
         onClose={() => setSignupDialogOpen(false)}
         onLogin={handleLogin}
+        onOpenLogin={() => {
+          setSignupDialogOpen(false);
+          setLoginDialogOpen(true);
+        }}
       />
     </div>
   );
diff --git a/src/components/auth/NostrExtensionIndicator.tsx b/src/components/auth/NostrExtensionIndicator.tsx
deleted file mode 100644
index b9680fd..0000000
--- a/src/components/auth/NostrExtensionIndicator.tsx
+++ /dev/null
@@ -1,50 +0,0 @@
-import React from 'react';
-import { useLoginActions } from '@/hooks/useLoginActions';
-
-interface NostrExtensionIndicatorProps {
-  onLogin?: () => void;
-  onClose?: () => void;
-}
-
-const NostrExtensionIndicator: React.FC<NostrExtensionIndicatorProps> = ({ onLogin, onClose }) => {
-  const login = useLoginActions();
-
-  const handleExtensionLogin = async () => {
-    try {
-      await login.extension();
-      onLogin?.();
-      onClose?.();
-    } catch (error) {
-      console.error('Extension login failed:', error);
-    }
-  };
-
-  function renderBody(): React.ReactNode {
-    if ('nostr' in window) {
-      return (
-        <>
-          <button
-            type='button'
-            className='underline text-blue-600 hover:text-blue-800 dark:text-blue-400 dark:hover:text-blue-300'
-            onClick={handleExtensionLogin}
-          >
-            Sign in
-          </button>
-          {' '}with browser extension.
-        </>
-      );
-    } else {
-      return 'Browser extension not found.';
-    }
-  }
-
-  return (
-    <div className='flex items-center rounded-lg bg-gray-100 p-3 dark:bg-gray-800'>
-      <p className='text-xs text-gray-600 dark:text-gray-400'>
-        {renderBody()}
-      </p>
-    </div>
-  );
-};
-
-export default NostrExtensionIndicator;
\ No newline at end of file
diff --git a/src/components/auth/SignupDialog.tsx b/src/components/auth/SignupDialog.tsx
index daf5552..61154e8 100644
--- a/src/components/auth/SignupDialog.tsx
+++ b/src/components/auth/SignupDialog.tsx
@@ -2,13 +2,12 @@
 // It is important that all functionality in this file is preserved, and should only be modified if explicitly requested.
 
 import React, { useState, useEffect } from 'react';
-
 import { Button } from '@/components/ui/button';
 import { Dialog, DialogContent, DialogHeader, DialogTitle } from "@/components/ui/dialog";
-
 import { toast } from '@/hooks/useToast';
+import { useLoginActions } from '@/hooks/useLoginActions';
+import { generateSecretKey, nip19 } from 'nostr-tools';
 
-import NostrExtensionIndicator from './NostrExtensionIndicator';
 import { cn } from '@/lib/utils';
 
 interface SignupDialogProps {
@@ -16,36 +15,76 @@ interface SignupDialogProps {
   onClose: () => void;
   onComplete?: () => void;
   onLogin?: () => void;
+  onOpenLogin?: () => void;
 }
 
-const SignupDialog: React.FC<SignupDialogProps> = ({ isOpen, onClose, onLogin }) => {
-  const [step, setStep] = useState<'key' | 'keygen'>('key');
+const SignupDialog: React.FC<SignupDialogProps> = ({ isOpen, onClose, onLogin, onOpenLogin }) => {
+  const [step, setStep] = useState<'key' | 'keygen' | 'download'>('key');
+  const [nsec, setNsec] = useState('');
+  const login = useLoginActions();
 
   const handleGenerateKey = () => {
     setStep('keygen');
+
+    // Add a dramatic pause for the key generation effect
+    setTimeout(() => {
+      try {
+        // Generate a new secret key
+        const sk = generateSecretKey();
+
+        // Convert to nsec format
+        setNsec(nip19.nsecEncode(sk));
+        setStep('download');
+
+        toast({
+          title: 'Your Secret Key is Ready!',
+          description: 'A new secret key has been generated for you.',
+        });
+      } catch {
+        toast({
+          title: 'Error',
+          description: 'Failed to generate key. Please try again.',
+          variant: 'destructive',
+        });
+        setStep('key');
+      }
+    }, 2000);
   };
 
   const handleHasKey = () => {
     onClose();
-    // This would trigger the login dialog to open with the key-add step
-    // For now, we'll just show a toast message
-    toast({
-      title: 'Use Login Instead',
-      description: 'Please use the login dialog to enter your existing key.',
-    });
+    if (onOpenLogin) {
+      onOpenLogin();
+    }
   };
 
-  const handleExtensionLogin = () => {
-    if (onLogin) {
-      onLogin();
+  const handleUseKey = () => {
+    try {
+      login.nsec(nsec);
+      if (onLogin) {
+        onLogin();
+      }
+      onClose();
+      toast({
+        title: 'Welcome!',
+        description: 'Your account is ready.',
+      });
+    } catch {
+      toast({
+        title: 'Login Failed',
+        description: 'Failed to login with the generated key. Please try again.',
+        variant: 'destructive',
+      });
     }
-    onClose();
   };
 
+
+
   // Reset state when dialog opens
   useEffect(() => {
     if (isOpen) {
       setStep('key');
+      setNsec('');
     }
   }, [isOpen]);
 
@@ -73,7 +112,7 @@ const SignupDialog: React.FC<SignupDialogProps> = ({ isOpen, onClose, onLogin })
 
               <div className='flex flex-col items-center space-y-3 w-full'>
                 <Button
-                  className='w-full bg-blue-600 hover:bg-blue-700 text-white font-medium py-3 px-6 rounded-lg'
+                  className='bg-blue-600 hover:bg-blue-700 text-white font-medium py-3 px-6 rounded-lg'
                   size='lg'
                   onClick={handleGenerateKey}
                 >
@@ -95,13 +134,41 @@ const SignupDialog: React.FC<SignupDialogProps> = ({ isOpen, onClose, onLogin })
             <div className='text-center space-y-4'>
               <div className='space-y-2'>
                 <p className='text-lg font-semibold'>
-                  Key Generation Coming Soon
+                  Generating your secret key...
                 </p>
                 <p className='text-sm text-muted-foreground'>
-                  Key generation feature is being developed. For now, please use an existing key or browser extension.
+                  Creating your secure key
                 </p>
               </div>
 
+              <div className='flex justify-center'>
+                <div className='w-8 h-8 border-4 border-blue-600 border-t-transparent rounded-full animate-spin'></div>
+              </div>
+            </div>
+          )}
+
+          {step === 'download' && (
+            <div className='text-center space-y-4'>
+              <div className='space-y-2'>
+                <p className='text-lg font-semibold'>
+                  Your secret key has been generated!
+                </p>
+                <p className='text-sm text-muted-foreground'>
+                  Your key is ready to use.
+                </p>
+              </div>
+
+              <div className='text-6xl'>
+                ✅
+              </div>
+
+              <Button
+                className='w-full bg-blue-600 hover:bg-blue-700 text-white font-medium py-3 px-6 rounded-lg'
+                onClick={handleUseKey}
+              >
+                Continue with generated key
+              </Button>
+
               <Button
                 variant='outline'
                 onClick={() => setStep('key')}
@@ -112,23 +179,7 @@ const SignupDialog: React.FC<SignupDialogProps> = ({ isOpen, onClose, onLogin })
             </div>
           )}
 
-          <div className='space-y-4'>
-            <div className='relative'>
-              <div className='absolute inset-0 flex items-center'>
-                <div className='w-full border-t border-gray-300 dark:border-gray-600'></div>
-              </div>
-              <div className='relative flex justify-center text-sm'>
-                <span className='px-3 bg-background text-muted-foreground'>
-                  or
-                </span>
-              </div>
-            </div>
 
-            <NostrExtensionIndicator
-              onLogin={handleExtensionLogin}
-              onClose={onClose}
-            />
-          </div>
         </div>
       </DialogContent>
     </Dialog>