A Guide to Ethereum’s ERC-4337 Standard and Account Abstraction

Explore Ethereum’s ERC-4337 standard and the concept of account abstraction, plus the potential to revolutionise smart contract wallets.

Dec 18, 2023

What Is Eth Erc 4337 F

Key Takeaways:

  • Ethereum’s account abstraction is a concept that turns users’ wallets into smart contract accounts.
  • This simplifies user interaction with wallets and prevents the loss of private keys, improving the Web3 experience.
  • The ERC-4337 token standard was deployed in 2023 and enables account abstraction, paving the way for a new type of cryptocurrency wallet.
  • ERC-4337 introduces ‘pseudo-transaction’ objects processed by a global smart contract, eliminating the need for users to employ private keys in each transaction.
  • Account abstraction supports social recovery, which offers a secure method for account access, allowing users to whitelist trusted addresses or use hardware wallets for recovery.
  • Account abstraction eliminates the need for seed phrases, enhances security, and could drive wider adoption with features like two-factor authentication (2FA) and biometrics.


This article explains how Ethereum account abstraction aims to transform user interaction with smart contract accounts. We delve into the ERC-4337 token standard for Ethereum and its potential advantages for spurring the Web3 revolution to attract more users and foster large-scale acceptance.

Vitalik Buterin, co-founder of Ethereum, has said that he sees account abstraction as a key factor in boosting wide-scale acceptance of the Ethereum platform. From a user’s point of view, this feature simplifies transaction processes and enhances wallet UX. Read on to learn how this works.

Why Was Account Abstraction Created?

Upon its creation, Ethereum developed a system of accounts based on its blockchain, which included two types of accounts: Externally Owned Accounts (EOAs) and contract accounts (CAs). EOAs are managed through public and private keys, while CAs are managed with smart contracts (codes). 

Users’ interaction with Ethereum is done through the use of EOAs, where every action that is carried out on the Ethereum blockchain requires a transaction to be started by the user and paid for using their EOA.

Drawbacks of EOAs

However, there are certain drawbacks to this configuration:

Non-custodial wallets, such as MetaMask and those by other well-known providers, are composed of a set of two cryptographic keys: public and private, which grant users access to their account. Any time a user wants to make transactions — depositing, donating, or moving a unique token like non-fungible tokens (NFTs) or cryptocurrency — the EOA signs the transaction and takes care of the associated gas fees.

For Ethereum, gas fees were introduced as a way to measure the amount of computation resources needed to carry out transactions and smart contracts. To motivate validators (known as miners prior to ‘The Merge’) to include user transactions in blocks, users are obligated to pay these gas fees.

For those new to decentralised applications (dapps), the process with EOAs is a lengthy and complicated task. In addition, if the private keys linked to a user’s EOA account are misplaced, the user can easily lose the funds stored in them. This results in a difficult and off-putting Web3 experience.

The ERC-4337 Standard

At the WalletCon event in ETHDenver in March 2023 (and later at the Paris EthCC in July 2023), the Ethereum team and Buterin announced the deployment of the ERC-4337 standard — the implementation of account abstraction in Ethereum, which is set to revolutionise the tedious process of EOAs.

Before the implementation of the ERC-4337 standard, there were several Ethereum Improvement Proposals (EIPs) that already suggested account abstraction but were never implemented. In 2021, EIP-4337 was put forth and, in 2023, it was ultimately permitted through governance due to its promise of no adjustments to the consensus-layer protocol. 

Its implementation allows for the development of a new type of cryptocurrency wallet.

How Does ERC-4337 Work?

What Is Erc 4337 Infographic4

The ERC-4337 standard offers a ‘pseudo-transaction’ object, referred to as a UserOperation, which sends a transaction on behalf of the user. These unconfirmed UserOperation transactions are stored in an alternative mempool.

Nodes on the Ethereum network have the option to act as a ‘Bundler’, which takes various UserOperation transactions and packs them into one transaction, known as a bundle transaction. This bundle transaction is then sent to a global smart contract, known as the ‘EntryPoint’, and is significant because there is only one entry point on the Ethereum blockchain.

The Bundler starts the process by calling the ‘handleOps’ function in the EntryPoint smart contract. When the bundle transaction is received, the ‘validateUserOp’ is run for every account that was part of it.

ValidateUserOp was designed to confirm that the signature of an operation is valid. If it is in accordance with the account’s evaluation, the specified gas fee payment is processed. To complete the function, another function needs to be implemented, and the operation relayed from the EntryPoint contract is then executed. This process makes the entire function programmatic, eliminating the need for private key usage and manual processes for users.

Account Abstracting Wallets 

Buterin has described social recovery as the “preferred method for ensuring a wallet’s security.” This is a technique made popular by some wallets that work within the Ethereum system. 

With social recovery, a user can be given access to their account again by whitelisting addresses that belong to people they trust, such as family and friends, or hardware wallets, such as Ledger and Trezor. 

Social recovery is expected to be available for the Crypto.com DeFi Wallet soon.

Advantages of Abstracting Accounts

Account abstraction provides a number of advantages to those who use Web3:

Seed phrases are a thing of the past

The ERC-4337 standard eliminates the need for seed phrases and the risks associated with their loss or theft. It also introduces other security measures, such as two-factor authentication (2FA) and biometrics, which are more user-friendly than traditional banking practices and could potentially drive adoption.

Smart contract wallets can help buffer human error

The implementation of smart contract wallets reduces the risk of human error, thereby increasing the accuracy of operations. Furthermore, account abstraction reinforces the security of a blockchain network: It is challenging for attackers to access funds from a particular account, as the user’s private key is employed only to approve the running of a smart contract, rather than to manipulate the assets stored in that account.

Chains seamlessly work together

Adaptation can be quickly and conveniently integrated into multiple blockchains with the help of ERC-4337. It is suitable for Ethereum Virtual Machine (EVM) networks like Cronos, Polygon, Avalanche, Arbitrum, and others.

Collaborative accounts and multiple-person operations offered

Because of a single seed phrase, the user of an EOA wallet like MetaMask has the option to either give someone complete control of their cryptocurrency wallet or keep it private and not give access to anyone. There is no middle ground.

However, account abstraction wallets offer the possibility of a multi-signature (multisig) system, in which any transaction can be completed only when two or more users sign it. Furthermore, there are options for adding users who are only allowed to make specific payments to a certain set of wallets in a specific period.

The Future of Account Abstraction

With its ability to provide detailed financial analytics and real-time information, account abstraction could become an essential part of how individuals manage their money. It is likely that this technology will continue to develop in the coming years, providing even more benefits to users.

A shift away from the current EOA wallet account model, which carries risk of total loss stemming from small mistakes, is facilitated by account abstraction to give users a better experience.

This new concept imagines a world where users can tailor their accounts to better fit their personal requirements through the usage of smart contracts. This could revolutionise the way individuals manage digital currency and propel the Web3 movement towards widespread acceptance.

Due Diligence and Do Your Own Research

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