At this time, new entrants in the Web3 space are compelled to familiarize themselves with creating a wallet, securing the private key, paying gas fees, buying and transferring funds, etc. However, lowering the entry barrier and improving the user experience is a prerequisite for mainstream Web3 adoption.
The core idea of Account Abstraction (AA) as the answer to onboarding challenges extends beyond simplicity, offering nuanced capacities that will unfold gradually. AA combines the advantages of externally owned accounts (EOA) and current contract accounts, making the account itself “programmable.”
As only smart contracts hold assets, the latter can have more extensive and customized features, such as gas fee payments on behalf, batch transactions, private key recovery, etc. This automates the gas subsidy and simplifies the on-chain interaction process.
A wallet solution like no other
Non-abstracted wallets rely solely on EOA to execute multiple separate transactions for certain operations, such as approving a token and then performing a swap, resulting in higher gas fees and user errors. Self-custodial wallet Ambire’s integration of AA aims to avoid exactly that, which sets it apart from other browser wallets on the market. The innovation allows the extension to support EOA without compromising account security. Ambire launched a gamified campaign that allows early extension beta users to adopt AA and smart accounts. After creating an account and connecting to the Legends dApp, they select an RPG-styled character. As they engage in blockchain activity, they earn XP points, unlocking rewards and advancing their character’s level.
The extension, which was developed for L1 and L2 blockchain users, emphasizes advanced security measures, such as supporting hardware wallets and preventing infinite approval. Ambire’s efforts aim to ensure the platform stands out in the wallet solutions market, currently valued at $10 billion.
Mitigating existing security risks
Web3 wallets that do not use AA face significant risks due to the reliance on traditional account structures. Users control EOA directly through private keys. If a user loses their key, they lose access to the wallet and its funds permanently.
Private keys can be stolen through phishing attacks, malware, or insecure storage. Without abstraction, the existing security layers to mitigate this risk are limited.
Implementing features like multi-signature wallets or social recovery mechanisms without AA requires complex smart contracts, which may not be user-friendly or widely adopted. Moreover, wallet support for programmable security features is not straightforward. It requires multiple approvals for large transactions or scheduling periodic payments.
Alleviating the user‘s onboarding journey
AA was deployed on Ethereum under the ERC-4337 standard in March 2023 and aims to enable more advanced transaction patterns by abstracting details like execution and validation from the user. It allows users to build programmable smart contracts from non-custodial wallets. It can unlock team wallets and signless transactions, making the Web3 experience more flexible, safer, and more convenient. ERC-4337 involves a new structure for abstracting out the mechanism of creating an EOA and signing and forwarding transactions to the blockchain. This approach protects users from potential complications that may arise due to the intricate underlying technologies. They can benefit from Web3 capabilities without possessing a deep operational understanding.
Efficient and safe transaction processing
One of ERC-4337’s key elements is the UserOperations mempool, an alternative transaction memory database existing alongside traditional transaction processing. UserOperations integrate specific, ERC-4337-defined logic, but their structure is similar to Ethereum transactions in that they contain sender, recipient, calldata, signature, nonce, and other familiar fields. They also feature additional fields because one needs multiple validations to execute a transaction.
Bundlers play a crucial role in EIP-4337 by aggregating UserOperations into a single batch before submitting them to the Ethereum network. Their primary purpose is to enhance transaction efficiency by reducing the overhead associated with processing individual UserOperations.
The EntryPoint smart contract releases and executes the UserOperations the Bundlers submit. If an operation encounters an issue, it can reverse actions, ensuring transaction reliability and integrity.
The ERC-4337 standard also includes smart contract accounts, conceptualized as automated assistants within Ethereum. They are unlike standard accounts in that they independently execute commands based on instructions, such as those received from user operations. They facilitate asset management, interactions with other contracts, and decision-making based on programmed logic, rationalizing complex Ethereum transactions.
A vital feature of AA is the separation of the account from the signer, freeing transactions from the limitations of a single entity responsible for signing. Multiple innovations result from decoupling the signer from the account, such as the possibility of numerous signers for one account and applying distinct validation methods for various transaction types. Users can also implement biometric authorization or search for signature schemes beyond the ECDSA (Elliptic Curve Digital Signature Algorithm).
Account Abstraction’s promise for smart contracts
Smart contract security is an essential piece of the blockchain puzzle as it handles asset creation, storage, and distribution. AA can enhance the protection and functionality of smart contracts by integrating advanced features and customizable logic directly into accounts. As suggested, accounts can require multiple approvals for executing high-value or sensitive smart contract transactions, which reduces the risk of unauthorized access. Contracts can include conditions that enforce time delays before executing certain operations, giving users time to cancel if they suspect malicious activity.
