An Ethereum network upgrade was quietly deployed this week as EIP-4337 went live. It ushers in a number of improvements for the Ethereum ecosystem.
On March 1, EIP-4337 deployed on the Ethereum mainnet heralding a new token standard – ERC-4337. The token standard implementation was initially proposed in September 2021.
At that time, it was described as:
“An account abstraction proposal which completely avoids consensus-layer protocol changes, instead relying on higher-layer infrastructure.”
Account abstraction essentially allows Ethereum wallets to operate as programmable smart contracts. This would enable users to recover lost private keys, among other benefits.
These new smart accounts could also help onboard the next wave of users to Ethereum and DeFi.
As opposed to third-party External Accounts that hold one set of cryptographic keys, Contract Account wallets are programmed by smart contracts. ERC-4337 merges the two account types into a new one.
Furthermore, users can program different mechanisms to enable their private keys to be retrieved. Instead of writing down seed phrases, users could secure wallets with 2FA (two-factor authentication) or biometrics.
This could allow for storing cryptographic keys on smartphones.
In October, Ethereum co-founder Vitalik Buterin commented:
“The big really valuable and necessary thing that ERC-4337 provides for account abstraction is a *decentralized fee market* for user operations going into smart contract wallets.”
On March 3, Professor John Keeting briefly explained the advantages of Ethereum account abstraction.
ERC-4337-enabled wallets could also carry out automated payments and set time-based spending limits, for example.
In December, credit giant Visa proposed an automatic programmable payments system using Ethereum account abstraction.
On March 2, Ethereum developers delayed the Shanghai staking hard fork until the middle of April. They confirmed that the final testing phase on the Goerli testnet will go live on March 14.
The latest upgrade is a big step forward for the network. However, BTC losses are pulling ETH prices down today.
The asset tanked 4.8% during the Friday morning Asian trading session. As a result, ETH has plunged to a two-week low of $1,569 at the time of writing.
Ethereum prices are currently 68% down from their November all-time high of $4,878. However, the asset remains within its range-bound channel as six weeks of consolidation continues.