Vitalik's EthCC speech: Supporting abstract accounts and smart contract wallets.

Original Title: "Vitalik EthCC Speech Summary: Account Abstraction Makes Crypto Wallets as Simple as Email"

Original Source: TechFlow Intern

On July 17th, the Ethereum Community Conference (EthCC) was officially opened in Paris. Vitalik Buterin, co-founder of Ethereum, gave a public speech endorsing smart contract wallets and discussing the history and future of account abstraction.

Since the beginning of this year, Vitalik has frequently expressed his support for smart contract wallets based on account abstraction. For example, in the June Twitter AMA, when asked about his views on MPC-based EOA wallets and smart contract wallets, he believed that MPC-based EOA wallets have fundamental flaws because they cannot revoke keys, and smart contract wallets are the only choice.

According to Vitalik, account abstraction is "very elegant" because it does not require changes to the underlying protocol like previous upgrades.

The concept of account abstraction itself is a rather abstract one.

Currently, Ethereum accounts are closely coupled with key pairs to the extent that they are essentially the same thing. That is, if you control the private key, then you control an account.

The account abstraction will decouple the entity (account) in EVM from the entity (key pair or signer) of ownership of mobile assets. As long as CA supports specific functions (such as signature verification), it can be an account.

The account abstraction essentially allows users to define the security model of their accounts, making Ethereum more suitable for different use cases.

For example, this feature allows users to set their own transaction verification rules, such as multi-signature requirements or spending limits. They can also make their accounts compatible with future cryptographic algorithms.

Vitalik described account abstraction as allowing Ethereum accounts to be controlled by smart contract code instead of private keys.

His idea is that in the future, everyone will switch from the current EOA wallet to a smart contract-based wallet. If successful, managing cryptocurrency wallets will become as simple as managing email accounts.

Early Stage of Account Abstraction

Vitalik said that the idea of allowing code to control accounts rather than just keys has been present in the design of Ethereum from the beginning.

The Ethereum Yellow Paper outlines two types of accounts: externally owned accounts (controlled by private keys) and contract accounts (managed by smart contract code). However, there were some challenges in the early stages of implementing the account abstraction.

In the first Ethereum proof-of-concept version, people were optimistic that users would adopt multi-signature wallets more. However, this did not happen immediately, and multi-signature wallets made it more difficult to detect exchange deposits. There is also complexity in paying miner fees from smart contract wallets. The initial vision was that all transactions would be simple "calls," but issues such as non-unique transaction hashes made the problem difficult.

Evolution of Account Abstraction

Over the years, the Ethereum community has iterated on many account abstraction ideas. Suggestions have been made around standardizing signatures, using "breakpoints" opcodes, and limiting access during transaction verification periods. However, progress has been slow due to the complexity of changing the underlying protocol and focus on providing proof of stake. It wasn't until 2020 that a specific account abstraction EIP (proposal) was put forward.

Gas Station Network and Argent Wallet, among other independent projects, have driven further innovation. They have found creative ways to enable meta-transactions and abstract accounts using only smart contracts. However, solutions that rely on "wrappers" also have drawbacks, such as higher transaction costs for each transaction.

Until later,  EIP-4337 was proposed, which provides a universal account abstraction standard using only smart contracts, avoiding changes to the underlying protocol.

Ethereum (ETH) upgrade will allow users to create non-custodial wallets as programmable smart contracts.

This will unlock many features, such as easy wallet recovery, transactions without signatures (meaning lower transaction fees), and team wallets (also known as multi-signature wallets).

According to Vitalik, this upgrade may be one of the main catalysts adopted by the global Web3. "One of the key properties we hope blockchain has is giving you money before you register," he said.

He said that the idea is to allow users to receive any tokens, such as stablecoins, in their smart contract wallets and pay gas fees without converting to ETH.

In order to allow these types of wallets and transactions to be broadcasted, the latest account abstraction upgrade will enable "paymasters", allowing users to pay gas fees with any token they are currently trading.

EIP-4337 also includes a signature aggregator, which allows multiple signers to join together, with only one being used for the transaction.

Vitalik said, "This is a very important thing," especially in Rollups, where the signature space on these types of L2 solutions is too large.

Ethereum L2, such as Arbitrum or Optimism, batch transactions together and verify them outside of the Ethereum mainnet.

The account abstraction will allow for signature aggregation. Simply put, this will allow for more data compression, resulting in cheaper computation, and according to Vitalik, "will reduce costs by 86 times".

In addition, this is not the only Ethereum upgrade currently underway. Proto-danksharding or EIP-4884 is also in progress. It has quickly become a major focus of network development as it lays the foundation for a new data type that will greatly reduce costs and make data usage more efficient.

Finally, Vitalik stated that in order to improve efficiency and resistance to censorship, people are increasingly hoping to directly incorporate some accounts (such as ERC-4337) into the protocol. He also pointed out the importance of ensuring a smooth transition for old EOA users and integrating innovative biometric signers.

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