Ethereum Developers Target Ease of Crypto Wallets With ‘EIP-3074’

As blockchain teams strive for the holy grail of mainstream adoption, making crypto wallets easier to use has suddenly become high on the agenda.

Ethereum developers are moving forward with their discussions and additions of specific Ethereum Improvement Proposals (EIPs) for the blockchain’s next major hard fork, Pectra.

One proposal that has received both support and concern from the Ethereum community is EIP-3074, a code change that is expected to improve the user experience with wallets on the blockchain.

Ethereum developers have tackled issues in the past to streamline the user experience with wallets and have deployed features that unlock newer capabilities. But now developers are striving to make the experience even easier and take part in the blockchain.

This new change is expected to allow a certain type of wallet, externally owned accounts (EOAs), to become more programmable by allowing smart contracts to authorize them.

Paradigm Chief Technology Officer Georgios Konstatonopolous said in x That EIP-3074 is a “major incident.” Wallet user experience will increase 10x.”

EIP-3074 is coming in the next Ethereum hard fork.

This is a big deal. Wallet user experience will increase 10x.

Congratulations to Ethereum and the EIP-3074 sponsors.

Reth has already implemented and tested this. We are fans.

Let’s go. https://t.co/lUiK2kb3UT

— Georgios Konstantopoulos (@gakonst) April 11, 2024

There are currently two types of wallet accounts on Ethereum: EOAs, which are the most popular, such as MetaMask and Coinbase wallet, and smart contract wallets, such as Argent and Safe.

Users of EOA accounts are issued a pair of keys (one public, the other private), while smart contract accounts are wallets controlled by code. The problem with EOAs comes from human error; If you lose the private key to an EOA account, there is no help desk or key recovery process that can help you regain access to your funds.

Previous proposals such as ERC-4337 aimed to facilitate the use of EOAs, a concept known as account abstraction (AA) that allows users to recover their crypto through smart contract features.

EIP-3074 is another step in this type of innovation, delegating transaction capabilities to smart contracts. A key component of the offering is allowing users to make transactions in bulk and sign once. Other features include third parties sponsoring users’ transaction fees; so decentralized applications (dapps) can cover gas costs for their users, for example.

The story continues

Created in October 2020, the offering also allows users to sign transactions sent by a different party (for example, signing transactions from a different interface or signing offline). According to the document, the writers are Sam Wilson, Ansgar Dietrichs, Matt Garnett and Micah Zoltu.

The main difference between EIP-3074 and ERC-4337 is that “the former focuses on getting all the benefits of execution abstraction, and the second focuses on getting all the benefits of computational abstraction across all EVM chains but in a non-native way,” said Ethereum Foundation developer Yoav Weiss, “which is less efficient.” “Both are steps toward taking advantage of some of the benefits of full local account abstraction,” he writes.

Community pushback

While many in the community supported the proposal, others cautioned against moving forward due to security concerns regarding the bulk actions feature.

Safe co-founder Lukas Schor, who has advocated for ERC-4337 and Ethereum wallets to implement full account abstraction, expressed fear that while this proposal moves in the right direction, EIP “is not a clear path to full account abstraction.” It has a net negative impact on AA adoption.”

Itamar Lesuisse, co-founder of Argent wallet Published on X He notes that EIP-3074 can be a serious security issue and that it “allows a fraudster to drain your entire wallet with a single off-chain signature.” “I expect this to be a significant use case.”

It should allow a fraudster to empty your entire wallet with a single off-chain signature. I expect this to be a major use case…

— itamar.eth (@itamarl) April 11, 2024

Mudit Gupta, chief information security officer at Polygon Labs. There was also calls for wallets to “prohibit EIP-3074 MAGIC signatures on a wallet-by-wallet basis” due to security concerns.

“I don’t want to subject my cold wallets to AA stacking for security reasons,” Gupta added.

Read more: Ethereum Upgrade Could Make It Harder to Lose All Your Crypto