The moment of breakthrough is coming? On-chain data analysis of ERC-4337 adoption status.
Original Author: 0x Kofi
Original Translation: Luffy, Foresight News
In a recent blog post, Vitalik Buterin described the adoption of smart contract wallets as one of the most important transitions Ethereum is currently facing.
ERC-4337 is the smart contract wallet standard (also known as smart accounts), and its main features are:
Users perform pseudo-transactions called UserOperations (UserOps).
Bundlers package batches of UserOps into a single on-chain transaction.
Applications can use Paymasters contracts to pay Gas fees on behalf of users.
Currently, there are over 350,000 ERC-4337 accounts deployed on Ethereum, Arbitrum, Optimism, and Polygon, with 83% of them created just last month. Smart accounts are experiencing exponential growth.
I analyzed the on-chain activities of ERC-4337 users and made some simple discoveries.
Polygon
In July, due to the launch of tokens by CyberConnect (a social network where all accounts are ERC-4337 wallets), there was a significant increase in ERC-4337 adoption on Polygon. In July alone, CyberConnect drove around 360,000 UserOps.
Optimism
Similarly, with the launch of CyberConnect on L2, the usage of ERC-4337 started to soar last week. The number of UserOps in the first four days of August was over four times the total for the entire month of July.
One of the second most popular applications on Optimism that uses ERC-4337 is Beam, a smart account wallet specifically designed for stablecoin payments.
Ethereum
A significant portion of smart account activity on Ethereum is focused on liquidity provisioning. In July, 41% of UserOps were generated by minting and transferring stETH, cbETH, and rETH.
For more data, please refer to my smart account dashboard on Dune.
https://dune.com/niftytable/account-abstraction
New Opportunities
Metamask Snaps
During ETHCC, the Metamask team announced the Snap Keyring API, which allows developers to add new types of accounts to Metamask outside of the EVM EOA. Later this year, Keyring will support smart accounts, which will play an important role in Metamask's future.
MEV
Currently, the ERC-4337 Bundler has exclusive access to MEV extraction of any UserOps sent to them. Bundlers can decide to sell access to the order flow to MEV searchers or run their own MEV strategies.
The long-term plan is to establish a public ERC-4337 memory pool where all UserOps will input before being packaged. I believe this will present opportunities for products like real-time memory pool data services.
Consumer Applications
The most successful consumer-facing crypto applications will have an abstracted wallet experience where account recovery, zero gas fees, and automated operations are standard features.
If you want to build a consumer-facing crypto application, you'll need to develop and audit a custom implementation. The most widely used crypto applications (Binance, Stake.com, Pornhub Premium, etc.) typically fully custodial funds.
As the ecosystem develops, Web3 teams will be able to access most key functionalities out-of-the-box using ERC-4337, while also offering self-hosted or partially hosted options. Features that are not provided by ERC-4337 may be built as plugins, benefiting any modular account implementations. Cryptographic consumer applications can utilize it to save a significant amount of development time.
