Summary

ERC-4337 is an Ethereum standard that enables account abstraction on the protocol without changing any consensus layer. ERC-4337 was deployed to the Ethereum mainnet in March 2023, enabling transactions and contract creation in a single contract account. This opens the door to designing user-friendly cryptocurrency wallets, thereby promoting and expanding the scope of wallet applications.

Introduction

The Ethereum Improvement Proposal (EIP) stipulates that Ethereum The platform’s core protocol specifications and contract standards, etc. The Ethereum Comment Request (ERC) is an Ethereum improvement proposal that sets application-level standards such as contract and token standards. An Ethereum Improvement Proposal (EIP) can become an Ethereum Comment Request (ERC) only after the on-chain governance authorization changes.

ERC-4337 is the latest ERC standard deployed on the Ethereum mainnet to achieve the long-awaited account abstraction of Ethereum The goal. Some people still use the original term EIP-4337 to refer to ERC-4337. However, EIP-4337 was first proposed in 2021 and authorized as ERC-4337 in 2023.

What is ERC-4337?

ERC-4337 was proposed in 2021 by Ethereum co-founder Vitalik Buterin and other developers to build account abstraction. In March 2023, ERC-4337 was deployed to the Ethereum mainnet, indicating that easy-to-use cryptocurrency wallets will soon be designed.

Ethereum account abstraction aims to combine the two existing types of accounts in the protocol (i.e. externally owned accounts (EOA) and smart contract accounts) functions combined into one. The ultimate goal to be achieved is a single contract account that trades tokens and creates contracts at the same time. This change enables innovative wallet designs such as social recovery, customization, and upgradeability.

Looking at it from another perspective, ERC-4337 brings smart contract functionality to wallets in a single account. This will make services like multi-factor authentication and automated payments easier to set up.

Why is ERC-4337 needed?

To understand why ERC-4337 is needed, one must first understand why ERC-4337 was proposed and implemented. Unlike the Bitcoin network’s Unspent Transaction Output (UTXO) module, the Ethereum protocol uses an account-based model. That is, the Ethereum protocol tracks and updates an account’s available balance when transactions are confirmed.

The two types of accounts in Ethereum each have different functions. Externally owned accounts are owned and controlled by users, while smart contract accounts are smart contracts deployed into the network. Both accounts can receive, hold and send Ethereum or tokens.

Most of the existing cryptocurrency wallets in Ethereum are externally owned wallets, such as MetaMask and others. These wallets are subject to set rules for externally owned wallets. Restrictions include that account access relies solely on private keys and all transactions require signatures. As a result, wallet setup procedures and private key security measures are often complex and not user-friendly. If a user loses their mnemonic phrase, it means they can no longer access the wallet.

ERC-4337 removes such restrictions. Smart contract wallets managed by smart contract accounts rather than externally owned accounts, such as UniPass and Safe, can achieve the same purpose. However, users must manage ether in two accounts, use it to pay for gas or rely on a centralized relay system. ERC-4337 eliminates such limitations by combining the functionality of two accounts into one, making it easier to deploy the required wallet functionality.

How does ERC-4337 work?

The Ethereum community has long been researching ways to achieve account abstraction. Prior to EIP-4337, the community proposed another proposal aimed at achieving account abstraction, called "EIP-2938". EIP-2938 is similar to ERC-4337, but requires changes to the consensus layer, which ERC-4337 circumvents.

ERC-4337 implements account abstraction by introducing a higher-level pseudo-transaction object called "UserOperation". UserOperation is similar to aggregation in that both involve different versions of the bundling concept. In ERC-4337, different users send UserOperation objects to separate memory pools.

The Bundler packages these objects into a transaction and includes them in a block. The bundler pays the gas fee for the bundled transaction, but charges a fee for executing the UserOperation individually. Bundlers work similarly to validators, selecting objects to include based on fee priority logic.

The wallet has added new features including validateUserOp, allowing it to also be used as a smart contract. A new contract called "EntryPoint" is also introduced to act as a security gate for executing these new functions.

What goals does ERC-4337 want to achieve?

ERC-4337 aims to achieve the following goals:

Account Abstraction: Users can enjoy a single account with both smart contract and externally owned account functionality.

Decentralization: Any bundler can participate in the process.

Avoid consensus changes: The Ethereum consensus layer focuses on upgrades for scalability, so it can Speed up application popularization.

Enable innovative use cases: including aggregated signatures, daily transaction limit settings, account emergency freeze, white List settings, privacy-protecting apps, and more.

Save time and save fuel: Bundlers can package UserOperation objects into a transactions, thus saving time and gas costs.

What does ERC-4337 mean to users?

ERC-4337 will make the complex operation experience of cryptocurrency wallets a thing of the past and increase the popularity of wallet usage. Here are some highlights of what ERC-4337 can achieve:

Wallet Setup: No need to write down a mnemonic word. Setup is quick and easy with just a few taps.

Worry-free account recovery: Users no longer need to worry about losing mnemonic phrases, now they can achieve multiple Authentication and account recovery.

Easy-to-use wallet features: Users can enjoy rich customization services, including automatic payment, pre-paid Approve deals and bundles. Only users can’t think of it, and ERC-4337 can’t do it.

Higher security: The chance of human error is reduced and the wallet will be more secure. No more carefully hiding your mnemonic phrase! Theoretically, ERC-4337 can bring users a smoother and more friendly experience and clear major obstacles for large-scale application popularization.

More flexible ways to pay for gas fees:Wallets powered by ERC-4337 are now available for any Pay gas fees with ERC-20 tokens and other currencies. Developers can create wallets that pay for gas in any token or even fiat currency.

Conclusion

Cryptocurrency wallet terminology such as mnemonics, private keys and public keys Intimidating for new users. The process of using a cryptocurrency wallet is still difficult for some people. Many agree that the interface for the average user needs to be as simple as possible to increase cryptocurrency adoption.

ERC-4337 lays the technical foundation to support innovative cryptocurrency wallets. The apps developers build on this foundation could change the primary touchpoint between cryptocurrencies and users. Regardless, let’s wait and see what impact ERC-4337 will have on user experience and the cryptocurrency industry as a whole in the coming years.

In-depth reading:

Introduction to ERC-20 Tokens

What is Ethereum?

Ethereum Shanghai upgrade concept and its impact

What is Ethereum EIP-4844, and how can this improvement proposal benefit users?

Disclaimer and Risk Warning: The contents of this article are facts and are for general information and educational purposes only and do not constitute any representation or warranty. This article should not be construed as financial, legal, or other professional advice and is not a recommendation that you purchase any specific product or service. You should seek your own advice from appropriate professional advisers. If this article was provided by a third-party contributor, please note that the views expressed in this article belong to the third-party contributor and do not necessarily reflect the views of Binance Academy. For more information, please clickhereto read our full disclaimer. Digital asset prices may fluctuate. The value of your investment may fall as well as rise and you may not get back the principal invested. You are solely responsible for your own investment decisions and Binance Academy is not responsible for any losses you may suffer. This article does not constitute financial, legal or other professional advice. For more information, please see ourTerms of UseandRisk Warning.