Vitalik Buterin proposes EIP-7702 aiming to refine account abstraction on Ethereum

Ethereum co-founder Vitalik Buterin, together with co-authors Sam Wilson, Ansgar Dietrichs, and Matt Garnett, have proposed Ethereum Improvement Proposal (EIP) 7702 as an alternative to EIP-3074, aiming to refine account abstraction on the Ethereum network.

EIP-7702 suggests a novel transaction type that enables externally owned accounts (EOAs) – normal Ethereum account addresses – to temporarily function as smart contract wallets during a transaction, with their original state restored afterward.

EIP-7702 serves as a new alternative to EIP-3074 (which was earlier considered for inclusion in the upcoming Pectra upgrade); however, it now adds quantum resistance and better compatibility with 4337, Uniswap founder Hayden Adams noted.

EIP-7702 aims to achieve compatibility with ERC-4337, another broader standard for smart contract wallets that is deemed “endgame account abstraction.”

“This EIP is designed to be very forward-compatible with endgame account abstraction, without over-enshrining any fine-grained details of ERC-4337,” the proposal stated.

Account abstraction enables wallets to work as smart contracts and operate a host of sophisticated features like multi-factor authentication, wallet social recovery and the flexibility for users to transact with any token.

As the Ethereum community evaluates the proposal, EIP-7702 might redefine how account abstraction is implemented in future network upgrades.

The new transaction type (proposed in EIP-7702) includes fields for contract code and a signature – providing the same functionalities proposed in EIP-3074, such as batch and sponsored transactions.

By allowing EOAs to temporarily convert themselves into contracts, they can be included in ERC-4337 bundles in a way that is compatible with the existing EntryPoint.