Op-Ed: From ease of access, lower transaction costs to approachable security features, ERC-4337 can help bring more users to growing corners of the blockchain sector.
The first wave of NFTs in the summer of 2021 (commonly known as “NFT summer”) can be classified as rigid in function, expensive (both in price tag and due to their skyrocketing gas fees), confusing to obtain, weak in security, and limited in their blockchain of origin — which for the majority of mints were Ethereum.
But after billions of dollars of headline-grabbing sales, viral on-chain communities, congested chains, cost-intensive transactions, lost assets, and relatively limited use cases, change is finally in the air — and not just on one blockchain (Ethereum) or through its traditional token standard (ERC-721). Over the last year and more, our market has watched more blockchains and novel token standards grow to support the next wave of blockchain-powered use cases. Dynamic utility, lower costs, and innovative opportunities for security, access, and adoption have demonstrated promise and possibilities for longevity and adoption over hype. From BNB Chain to Solana and Polygon, SBTs (soulbound tokens) to the token standard covered in this piece — Ethereum’s latest upgrade, the ERC-4337 — the future of NFTs and wallets we store are looking increasingly innovative for developers, users, and web3 overall.
ERC-4337: What it is and why it’s needed
ERC-4337 stands for “Ethereum Request for Comment 4337.” This moniker has nothing to do with public relations, but a smart contract standard for account abstraction, which enables individual Ethereum wallets to act as a customizable smart contract. This novel concept brings to life various user and developer-focused innovations that help abstract away some of the complexities of crypto wallets, like switching networks, cryptographic signatures, and private key management.
Through the power of account abstraction, we can empower users with powerful new features that help bypass certain key challenges in web3 that have contributed to the bottleneck in increasing mass adoption of decentralized applications. Below, let’s see what some of these features are and what value they bring.
Social Recovery: Think of this like two-factor authorization (2FA) that’s become commonplace as a security standard across most social media, email, and web2 applications. In this case, if you lose your private keys, which grant you access to a web3 wallet like Metamask, you can recover access to your assets through 2FA connected to your phone, email or even biometrics without needing seed phrases.
Signature Abstraction: Think of this like a mobile banking app. You can set automated limits on daily transfers, trades, or budgets for certain categories of transactions. By allowing users customization options to define their wallet’s authorization schemes, we can open up an entire range of possibilities. Example: the user can set rules to reject transfers over $500 USDC or require multi-party signatures for transactions above $50 USDC.
Session Keys: Consider it like ‘Remember Me’ when signing onto your favorite web2 social application. By utilizing account abstraction, we can enable session keys that remember your wallet without the need to sign every little action on a web3 dApp.
Batch Transactions: By batching transactions together, users can execute trades more efficiently and inexpensively. If you’ve ever swapped a token on Uniswap, you know how you have to sign the transaction multiple times (at least twice) to approve and execute that transaction. With account abstraction, we can batch those together, consume less gas and make the user experience less clunky and intimidating.
Gas Delegation: This is crucial for the growth of web3 dApps, where congested blockchain often leads to high hefty price tags for users. This is especially apparent in NFTs, where in 2022, an anonymous Bored Ape buyer spent $45,000 in gas fees. By delegating the gas fees to others, or alternatively, an application taking over the responsibility for paying their users’ gas, we can fuel mass adoption in web3 by empowering more people to engage. No user wants to pay for a gas fee every time they perform an action on a dApp. By passing on that cost to the underlying platform, we enable alternate, novel business models that don’t rely on users transacting as much as humanly possible.
Multi-Party Computation: Think of this one as ‘sign in with Google,’ but for web3 wallets. Instead of authorizing another application to log into an account for you, it allows you to enable (and require) multiple key signers, each holding their private data to trigger an action (like signing in with a private key) without revealing that action to the other parties.
The potential of ERC-4337 in the future of web3
By offering developers and their applications the flexible, approachable, and intuitive features, ERC-4337 shows tremendous potential across multiple use cases, not just in NFTs, but any web3 sector that relies on tokenized assets and on-chain transactions (which is most!).
From ease of access to lower transaction costs, approachable security features, and speed, ERC-4337 can help bring more users to growing corners of the blockchain sector like decentralized social apps, where tokenized content and on-chain identity feature warrant more accessibility for communities to engage, leverage wallets, and build audiences. Like any piece of technology that’s made it easier for humans to create and connect, ERC-4337 shows serious potential in ushering a new era of innovation and adoption.
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Ryan Li is the Co-Founder of CyberConnect, web3’s earliest and biggest decentralized social network, focusing on building and scaling the next generation of decentralized social media platforms. A serial entrepreneur, Ryan has founded multiple companies that have been acquired by top names in decentralized technology, including DLive, Lino Network, and SketchMe. Ryan continually advances the adoption of platforms that provide users unmitigated access to content posting and monetization. Ryan holds a Bachelor's degree in Electrical Engineering and Computer Sciences from University of California, Berkeley.
CyberConnect is web3’s earliest and biggest decentralized social network, that enables developers to create social applications empowering users to own their digital identity, content, connections, and monetization channels. Its latest V3 upgrade introduces a set of powerful improvements to the CyberConnect social network to usher web3 social into a new, multi-chain future. V3 is designed to power the next stage of hyper scalability for web3 social dApps and give users a social networking experience that feels familiar to web2. It has three core components: CyberAccount, an ERC-4337-compatible identity infrastructure; CyberGraph, a censorship-resistant database to record users’ content + social connections; and CyberNetwork, a gas-efficient and scalable network to bring CyberConnect to the world.
Founded by Silicon Valley-based serial entrepreneurial team in 2021, there are already over 50 projects that are using CyberConnect to build social features for real-world use cases, such as community-owned social networks, marketplaces, content curation, discovery tools, and more. As of July 2023, CyberConnect protocol has 1.2M user profiles and 400k monthly active wallets who have conducted more than 15.2M transactions in total. Over 2,400 verified organizations created their CyberProfiles to build web3 native audiences. CyberConnect’s flagship social app, Link3 has 940k monthly active users.
CyberConnect is backed by Multicoin and Animoca Brands, among other top investors, and has raised over $25M since its inception.
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