It remains a challenge for regular users to enter the field of encryption. This is because the encryption field involves many complex technical concepts, such as smart contracts, private keys and public keys, cryptocurrency wallet terms, and the restrictive infrastructure between centralized and decentralized entities. However, the introduction of some innovative and user-friendly protocol standards on Ethereum seems to simplify things.
Similar to standards like ERC-20, ERC-721, and ERC-1155, new protocols such as ERC-4337 and ERC-6551 also play important roles in expanding the Ethereum ecosystem. The Ethereum developer community has unlocked many innovative dapp use cases and reduced the barrier to entry for regular users through these protocols. Once implemented, Ethereum will become more customizable, flexible, and future-oriented.
1 About EIP and ERC?
First, let's introduce the difference between EIP and ERC. Ethereum Improvement Proposals (EIPs) define core protocol specifications and contract standards for the Ethereum platform. Ethereum Request for Comment (ERC) is a type of Ethereum Improvement Proposal that sets application-level standards for contracts and tokens. EIP can only become ERC after being authorized for on-chain governance changes.
2 ERC-4337
ERC-4337: Introducing smart contract capabilities into wallets.
ERC-4337 is an Ethereum standard that achieves account abstraction at the protocol level without changing any consensus layer. It was proposed in 2021 and deployed to the Ethereum mainnet in March 2023. ERC-4337 enables transactions and contract creation within a single contract account. Essentially, account abstraction creates a new type of account, turning users' encrypted wallets into accounts that support smart contracts.
There are two types of accounts in Ethereum, each with different functionalities. Externally Owned Accounts (EOAs) are owned and controlled by users, while Smart Contract Accounts (contract accounts) are contracts deployed on the network. Both types of accounts can receive, hold, and send ETH or tokens.
Currently, most wallets created on Ethereum are EOA accounts, such as MetaMask. These wallets are limited by the rules set for EOA accounts. The limitations include the complete reliance on private keys for account access and the requirement of signing all transactions. As a result, wallet setup procedures and private key security measures are often complex and inconvenient for users. If a user loses their mnemonic phrase, they permanently lose access to the account and its funds.
ERC-4337 eliminates these limitations. With ERC-4337, users can enjoy a single account that combines smart contracts and external ownership. This makes the wallet synonymous with smart accounts - entities that can perform multiple tasks, handle multi-factor authentication, initiate and maintain cryptocurrency subscriptions, and more - all implemented through code.
In general, the implementation of account abstraction aims to provide two benefits for wallets: making encrypted wallets more user-friendly and preventing the loss of cryptocurrency or wallet access. It can make it easier for non-crypto users to access Ethereum, and solve some key issues that users currently face from creating wallets to using them, making wallets simpler and easier to use.
3 ERC-6551
ERC-6551 : Changing the rules for NFTs
ERC-6551 is an emerging Ethereum NFT standard, released on the Ethereum mainnet on May 7, 2023. The ERC-6551 token standard improves the functionality of NFTs by enabling smart contract accounts. The key feature of ERC-6551 is token-bound accounts (TBA). Token-bound accounts provide an interface and permissionless registry for NFTs based on ERC-721 smart contract accounts.
ERC-6551 empowers each ERC-721 token with full Ethereum account functionality. Token-bound accounts allow ERC-721 tokens to possess assets from other chains and interact with utilities without modifying existing ERC-721 smart contracts or infrastructure. Token-bound accounts immutably record all activities performed on the blockchain.
What innovative use cases does ERC-6551 bring?
1 Composability: You can bundle your related assets (NFTs, tokens, identity features, etc.) into one NFT, making it easier to manage and transfer your assets across different platforms.
2 On-chain identity: Make NFTs truly on-chain identities. In other words, your NFT can interact with dapps independently, without relying on the wallet that holds it.
3 Utility: Currently, NFTs cannot interact with other on-chain assets or platforms on their own, which limits their functionality. With TBA, NFTs are no longer just ownership certificates, they become more valuable and practical.
Through ERC-6551, the functionality of NFT is equivalent to a wallet with an address, where each NFT on Ethereum has its own wallet. At the same time, ERC-6551 is built on the ERC-4337 standard, which aims to simplify the user wallet experience. Therefore, within the new form of wallet standard, "smart account", TBA functionality is integrated for NFT, greatly optimizing the user experience of Web 3.
4 Summary
Whether it is ERC-4337 or ERC-6551, these innovative standards that change the rules of the game and are user-friendly greatly improve the user experience of Web 3. For ordinary users and cryptocurrency beginners, it will be easy to create their own smart wallet accounts and easily experience decentralized applications. As the technological barriers to entry into the crypto field continue to decrease or disappear, there is hope for accelerating the large-scale adoption of cryptocurrencies and Web 3.
