Ethereum developers are working hard to improve the usability of their blockchain. The expense of small mistakes is one of the drawbacks of cryptocurrency. For instance, if a user misplaces the password to their cryptocurrency account, they might never again be able to access their crypto assets. It’s far simpler to lose money in bitcoin than in traditional banking in the face of this and other possible problems.
It will be challenging to take cryptocurrency into the public without fail-safes and improved usability, as blockchain developers are more aware that human error is inevitable. The idea of “Account Abstraction” is one of those inventions.
By establishing specific validity requirements, Account Abstraction (AA) intends to employ smart contracts to carry out cryptocurrency transactions. Users won’t have to use their private keys to approve each transaction using AA.
According to Kristof Gazso, co-author of an Ethereum Improvement Proposal (EIP) on AA, “we’re going to be at a position in the future where utilizing an Ethereum account, it’s going to be just as straightforward as using a bank. ” People won’t have to choose between, like, “Hey, you know, I enjoy decentralization, but it’s also a pain in the ass to use Ethereum,” or something similar.
Developers intend to eventually employ AA to make Ethereum as useable as a conventional fiat bank account so that users can conduct transactions more quickly. Set up recurring payments for bills
But first, it’s crucial to comprehend how Ethereum transactions currently work before attempting to comprehend how AA can alter the nature of how one may use cryptocurrency.
Ethereum accounts: EOAs and CAsUsers on Ethereum can create External Owned Accounts (EOA) and Contract Accounts, two different kinds of accounts (CA). How the two account types start transactions via Ethereum’s network is different.
If you have utilized a wallet provider like MetaMask or Coinbase Wallet, you use an EOA, which is the typical account type for Ethereum users.
Users receive a public and a private key pair as part of an EOA. An EOA’s public key can be used to pay money to it by anyone. However, only the account owner, who must have access to the private key for the account, can actually start transactions from the account.
The Ethereum network is home to CAs, also referred to as “smart contracts,” which resemble tiny computer programs. These accounts are managed by code, not by private keys, but they are unable to start transactions on their own. Instead, an EOA must transmit a transaction to a CA in order for it to conduct transactions on its own.
Human error is the root of the EOA issue. One key has total administrative authority over your account, according to Gazso, an EIP 4337 co-author. You will permanently lose control over your account if you lose it.
There is no help desk or key recovery procedure (like a “password reset” button) that can help you regain access to your cash if you lose a private key to an EOA account.
The biggest security vulnerability in Ethereum account management, according to Gazso, is people. While specific figures on how much ETH is lost due to misplaced keys are not available, Bitcoin accounts use a system of private keys that is comparable to that of Ethereum. Up to 23% of all bitcoins in circulation, according to a Chainalysis report (or around 3.79 million BTC) could be lost forever because of forgotten keys.
And not just lost keys are a concern. A person’s finances are completely in their control if someone (think: hackers) manages to get their hands on that person’s private key.
How is Account Abstraction implemented?By combining EOAs with CAs, Account Abstraction corrects the flaws in EOAs by enabling users to build user accounts with built-in fail-safe procedures and other unique features for authenticating transactions.
Instead of [smart contract code] only being used to execute the logic of applications, it would also be used to implement the verification logic (nonces, signatures…) of individual users’ wallets, as Ethereum co-founder Vitalik Buterin stated in a 2021 blog post.
Account abstraction allows for the programming of social recovery systems into user accounts, enabling several people, each with their own key, to restore access to a user account in the event that the account owner loses the private key.
Another option is to develop “multisig wallets,” which transfer account ownership to a group and add an additional degree of protection by requiring several parties to approve transactions.
Additionally, some of the additional hard-coded restrictions of EOAs might not apply to accounts under AA. For example, they could specify how customers pay gas taxes. Currently, users on Ethereum must pay gas in ether under EOAs (ETH).
All of these systems are possible to implement today using CAs, but with a significant degree of complexity and overhead (ie, gas costs) due to the requirement that all transactions are initiated by an EOA.
How to achieve full implementation of Account Abstraction? There are a bunch of proposals that aim to add AA to Ethereum, with the most prominent being EIP-4337. “It really is the first proposal which achieves Account Abstraction without requiring a hard fork,” Gazso said.
The key advantage of EIP-4337 is that implementing it won’t require any changes to Ethereum’s core protocol. The proposal would just add a new account abstraction layer atop Ethereum’s core protocol – enabling wallet providers to create user-owned accounts that use smart contracts to set the rules for initiating transactions.
So if all these tools are currently available, why isn’t account abstraction more widespread?The answer to that is momentum. It’s obviously not easy to build a new wallet, launch it and ship it to people. “Convincing people to try out new technology, new wallets, is a very difficult task,” Gazso added. That is why people who do initially start their crypto journey turn to something that has been around longer or that has been battle-tested, like a MetaMask wallet.
So finding people to implement these new technologies seems to be the biggest bottleneck for account abstraction. But the tide for that seems to be changing.
What’s cooking with Account Abstraction? Some layer 2s on Ethereum are leading the way to natively integrate AA. StarkWare, the company behind the StarkNet blockchain, is already live with Account Abstraction. Eli Ben-Sasson, the co-founder and president of StarkWare, told CoinDesk that Account Abstraction could be used in the future to “use your facial recognition or biometrics to basically authorize [crypto] payments,” sort of like how FaceID can activate credit card payments for iPhone users. “The infrastructure for doing this is now possible on Starknet,” Ben-Sasson added.
Last month, Visa also announced its proposal to eventually use Account Abstraction to deploy automatic payments with StarkNet infrastructure. This would emulate automatic payments in a bank account to pay bills, except now it could be done on the blockchain.
Account Abstraction is something that other businesses, including Gnosis Chain, are attempting to include into their architecture. “Slowly, interest in AA is building as more and more developers and consumers become aware of the possibilities,” Gnosis Chain co-founder Stefan George told CoinDesk.
2023 will once again be “the year for account abstraction,” according to Gazso, who also noted that it is now one of the ecosystem’s most hotly debated subjects.