Ethereum developers already have their sights set on Pectra, the new Ethereum hard fork that they expect to arrive in 2024, and where EIP-3074 would be activated, finally bringing to Ethereum the full native implementation of Externally Owner Accounts (EOA).
Ethereum, as a leading smart contract platform, is constantly evolving to improve the experience of its users. One of the proposals most significant in this sense is the EIP-3074, which promises to revolutionize the way we interact with cryptocurrency wallets on the Ethereum network. This EIP is expected to be activated in a new Ethereum hard fork, Pectra, which is expected to be activated before the end of 2024.
With Pectra, the developers are looking to achieve a significant advancement in Ethereum functionality by bridging the gap between traditional wallets and smart contracts. To do so, it seeks to introduce the integration of standard externally owned accounts (EOA), including widely used wallets such as MetaMask, with smart contract capabilities.
This integration allows EOAs to access broader features typically associated with smart contracts. For example, EOAs can now participate in transaction bundling, which allows multiple transactions to be grouped together for efficiency and cost savings. Additionally, they can participate in sponsored transactions, where a third party covers transaction fees, expanding opportunities for decentralized finance (DeFi) protocols and other applications.
EIP-3074, the next iteration of Ethereum wallets
Let us remember that the acronyms, EIP, stands for Ethereum Improvement Proposal. It is a document detailing the proposed technical features to be added or modified to the Ethereum network. EIP-3074 (AUTH and AUTHCALL opcodes) is one of these proposals and its objective is to simplify user interactions with wallets and enhance their capabilities.
Among the main objectives of this new EIP, we can mention:
- Improve user experience in wallets. This is done by allowing human-controlled accounts (EOA or Externally Owner Account) to be more programmable.
- Batch transactions. EIP-3074 will make it easier to group multiple transactions into one, allowing users to authorize multiple operations at once.
- Delegation of authorizations. EIP-3074 can allow smart contracts to authorize transactions on behalf of an EOA.
- Cover transaction costs. Finally, this EIP can allow third parties to pay fees for users' transactions. This can amplify the use of certain Web3 platforms.
Operation of the EIP-3074
EIP-3074 introduces a number of code changes that allow smart contracts to authorize transactions by EOAs. This means that they could execute transactions on behalf of a user, provided that the latter has given prior consent. The idea is to facilitate access to wallets, while also automating certain payment processes. For example: EIP-3074 within a wallet could allow you to make predefined monthly payments to a subscription platform that accepts cryptocurrency payments.
Now, while the integration of EIP-3074 offers exciting possibilities for Ethereum users and developers, there are concerns about potential security vulnerabilities. Smart contracts introduce additional complexity and attack surfaces, increasing the importance of implementing robust risk management strategies to safeguard user funds and the integrity of the Ethereum network. As Ethereum evolves and adopts new features, addressing these security challenges will be essential to maintaining trust in the ecosystem.
Hence the need to test this development in a meaningful way, and Ethereum developers are now in the midst of that work. This can be seen very clearly in the Recent changes that Vitalik Buterin himself has made to the proposal, in order to simplify the implementation and make it safer. An idea that Schor Lukas, co-founder of Safe, takes up and echoes on his X/Twitter account.
An important step
From all of this, it is clear that EIP-3074 represents an important step towards improving wallet interaction on Ethereum, offering potential benefits in terms of usability and security. Although there are still challenges ahead, especially regarding security concerns, the proposal is still under development and fine-tuning by Ethereum developers and the community.
We are not only talking about enabling new use cases, but also about further adapting the cryptocurrency payment ecosystem to the reality that we are already used to seeing in the traditional financial world. For example, currently making recurring monthly payments with cryptocurrencies is only possible with centralized platforms (at least doing so in a simple way, and without major technical knowledge). Well, this will change radically with the arrival of EIP-3074, since you will be able to do it even with your MetaMask wallet, without any intermediary to do it.
Thus, little by little, your cryptocurrency wallet will not only become your crypto treasure chest, but a complete payment solution capable of helping you manage your cryptocurrencies in a more efficient and, above all, decentralized way.
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