- Ethereum developers are considering changes to make in the network’s next upgrade.
- One of the confirmed additions promises to improve the Ethereum wallet user experience significantly.
- Despite the benefits, experts have raised multiple concerns.
Barely a month after the Dencun upgrade that significantly reduced fees for Layer 2 chains, Ethereum developers are already working hard to figure out the next upgrade.
The next Ethereum upgrade, dubbed Pectra, will include a collection of small changes to the network. As developers decide which changes to include, one particular addition has turned heads: EIP-3074.
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The proposal promises to greatly improve the wallet experience for Ethereum users, but some argue that it may come at an even greater cost.
EIP-3074: Bringing Account Abstraction to Normal Wallets
On Thursday, April 11, Ethereum Foundation Protocol Support member Tim Beiko disclosed that ERC-3074 would be included in the Pectra upgrade. First proposed in October 2020, EIP-3074 aims to improve the user experience of Ethereum wallets by enabling several new functionalities.
These functionalities include sponsored transactions, the ability to cover gas fees from a separate wallet, batch transactions, allowing users to sign once for a process that will typically involve multiple transactions like DEX swaps, and asset recovery if a user loses their private key with the aid of social recovery tools that could rely on sharing your key with trusted contacts or guardians.
Judging by the benefits, EIP-3074 is quite similar to ERC-4337, which was introduced in 2023. Where they differ, however, is in how they achieve these outcomes. Where ERC-4337 replaces standard wallets with smart contract wallets by introducing a new layer on top of Ethereum, EIP-3074 makes code changes to the EVM, allowing standard wallets to delegate control to a smart contract called an invoker.
As such, EIP-3074 enables simpler account abstraction implementation for existing wallets.
But EIP-3074 is not without its drawdowns.
Potential Security Risks Raise Concern
Despite the promised benefits, some fear that EIP-3074 offers multiple attack vectors that greatly increase the chances of asset loss. Potential risks include an invoker bug and sophisticated phishing attacks that could see users cede control of their accounts to bad actors.
Voicing these concerns, DefiLlama founder 0xngmi asserted that with EIP-3074, users could now lose all their funds by signing a single transaction.
Beyond security concerns, Ethereum Researcher Angsar Dietrichs, one of the authors of EIP-3074, contended that implementing the three-year-old EIP could represent a step backward in the account abstraction roadmap.
Dietrichs’ view comes as developers tip ERC-4337 to offer a more comprehensive account abstraction solution with greater user control and security. Per the ERC-4337 roadmap, developers aim to eventually transition all normal wallets to smart contract wallets.
At the same time, Dietrichs worries that building with two different stacks could cause interoperability hurdles in the future.
The Ethereum Pectra upgrade is expected to go live toward the end of 2024 or early 2025.
On the Flipside
- Uniswap founder Hayden Adams has suggested that DApp UX improvements could mitigate some of the security concerns around EIP-3074.
Why This Matters
The crypto industry must abstract the complexities associated with blockchain technology to attain mainstream adoption. While ERC-3074 promises to abstract away these complexities for Ethereum wallet users, it is essential to consider the potential security risks that could come with the change.
Read this for more on Ethereum’s next steps:
Buterin Looks Beyond Dencun as ‘Blobscriptions’ Raise L2 Fees
Polygon has taken another step to revamp governance. Find out more:
Polygon (MATIC) Eyes Sustainable Growth With Treasury Proposals
