Summary: On March 1st, Ethereum received a major new feature: account abstraction. This will enable a new type of “smart account” that will remove the need for a 12-word phrase and make for a significantly easier and more secure user experience. Let’s look into what EIP-4337 is, what features it enables, and how it will impact ...
On March 1st, Ethereum received a major new feature: account abstraction. This will enable a new type of “smart account” that will remove the need for a 12-word phrase and make for a significantly easier and more secure user experience. Let’s look into what EIP-4337 is, what features it enables, and how it will impact the Web3 experience.
EIP-4337 is an improvement to Ethereum that was initially authored by Ethereum co-founder Vitalik Buterin, Yoav Weiss, Pimlico founder Kristof Gazso, and others in September 2021. Its main idea is to create a protocol for account abstraction using higher-layer infrastructure without requiring any changes to the main Ethereum consensus layer. Account abstraction allows users to use smart contract wallets “containing arbitrary verification logic” instead of the typical public-private keypair accounts. After two years and funding from the Ethereum Foundation, the standard is finally ready for use. It has been deployed on all major EVM-based chains, including Avalanche, Polygon, Optimism, and Arbitrum.
The smart contract wallets enabled by EIP-4337 provide many features to wallet users. Some of the possibilities include social recovery, where a user can delegate a trusted friend or lawyer with the ability to recover their wallet in case of a loss of access, multi-factor authentication, spending only open in specific windows or for certain values, and using applications without having to sign every transaction manually. Another feature is the ability for apps to sponsor transaction fees or accept payment in any token. These features could effectively minimize the risk of a wallet hack or compromise to near-zero and guarantee that users would never lose access to their funds. Additionally, the ability to pre-authorize transactions and cover fees help the user experience and could make decentralized applications feel a lot closer to the Internet experience we know today.
Even though account abstraction is new to Ethereum, other protocols have already successfully adopted the technology. For example, NEAR Protocol’s wallets have been utilizing account abstraction for quite a while and provide an easier user interface than competing blockchains. Additionally, zero knowledge rollup project StarkWare has been developing an account abstraction standard for their protocol.
Account abstraction’s impact on mass adoption cannot be overstated – it finally allows for the recoverability and user experience of an app like PayPal with all the benefits of blockchain and decentralization. At this point, the average person's main entry barrier into the world of DeFi is the onramp and offramp process, which is still difficult and requires withdrawing from a cryptocurrency exchange. As soon as it becomes easier for users to go from their bank account to their smart account, DeFi will become vastly more popular, leading to an increased value for the tokens and blockchains associated with the movement.
By implementing account abstraction, Ethereum is proving its capability to innovate and remain competitive in an increasingly saturated smart contract protocol market. At the moment, they remain the king of smart contract platforms. That position does not seem like it will be changing anytime soon – it holds over 60% of the total DeFi market share by total value locked on chain, and even more if Layer 2s like Optimism and Arbitrum are considered.
Overall, EIP-4377, which may seem technical and insignificant at first glance, will be the basis for the next wave of mainstream adoption. Ultimately, tools like account abstraction will be responsible for onboarding the next billion users, a stated goal of the Ethereum Foundation in recent months.
By Lincoln Murr
Tags: Account Abstraction,Avalanche,DeFi,EIP,EIP-4337,Ethereum,Starkware
Link: EIP-4337: Will Account Abstraction Bring Mass Adoption to Ethereum? [Copy]