From AI Agents to On-Chain Permission Boundaries: What is ERC-8004 Changing?

With the development of applications such as DeFi, Account Abstraction, and AI Agents, on-chain authorization is evolving from a one-time signature confirmation into a long-term, reusable execution permission. Simultaneously, new changes are emerging: AI Agents have begun to possess the ability to automatically request services and complete payments. For instance, the x402 protocol, through the HTTP 402 status code, enables Agents to pay for resources and services instantly with stablecoins without human intervention. This transforms on-chain actions from isolated transactions into continuous, automated collaborative processes.

In this context, the authorization issue is further amplified. The current authorization methods within the Web3 ecosystem remain ambiguous in scope and crude in expression, often only addressing whether assets can be used, but struggling to define what specific actions are permitted and to what extent. ERC-8004 is proposed precisely against this backdrop. It does not define new assets nor alter how transactions or payments are executed. Instead, it attempts to establish a permission model for on-chain behavior that can be understood and validated by the system, making authorization itself a describable, constrainable, and manageable object.

From a broader systemic perspective, ERC-8004 is not in competition with Account Abstraction or automated payment protocols like x402; rather, they operate at different layers in a division of labor: x402 solves the problem of value exchange after an action occurs, while ERC-8004 focuses on who is permitted to act and whether permissions are exceeded before the action happens. In scenarios like DeFi, AI Agents, enterprise applications, and RWA, this structure of "permissions first, payment follows" has the potential to elevate authorization from the asset level to the behavior level, providing a controllable foundation for more complex, long-term automated collaboration. Despite facing practical challenges in learning curve, wallet support, and user experience, ERC-8004 is not a short-term narrative tool but a foundational standard concerning whether Web3 can support the operation of complex systems.

1. The Motivation Behind ERC-8004

As on-chain infrastructure continues to evolve, capabilities related to asset tokenization and transaction execution are being continuously abstracted and enhanced. From ERC-20 and NFTs to multi-signature wallets and Account Abstraction (ERC-4337), the barrier to entry for user participation in on-chain activities has been consistently lowered, and accounts themselves have become increasingly intelligent.

However, throughout this progression, a fundamental issue has remained systematically unresolved: the authorization mechanism itself has seen almost no substantive evolution. In the early days of Web3, authorization meant a single private key signature. Users expressed "I agree" through signing, whether for transfers, contract calls, or approve operations. Authorization was treated as a one-time confirmation, with the risk boundary entirely borne by the user.

Yet, today's on-chain environment has changed. In DeFi scenarios, approvals are often long-term. Under automated strategies and Session Key systems, authorizations are reused repeatedly. In models where AI Agents or bots execute transactions, users may no longer even directly participate in each operation. Authorization is evolving from a one-time confirmation into a persistent execution capability, more akin to delegating the power to perform certain actions for a period of time.

The problem is that current Web3 infrastructure provides almost no clear, unified way to constrain this state of long-term authorization. Vague permission scopes, difficulty in revoking authorizations, and unpredictable risks have become the source of numerous security incidents. Meanwhile, Account Abstraction further amplifies this contradiction: when an account can automatically execute transactions and have gas fees paid by third parties, what it can and cannot do becomes even less clear.

It is precisely in this context that ERC-8004 is proposed. It attempts to fill a long-missing piece in Web3: establishing a clear, constrainable, and system-understandable permission model for authorization itself.

2. The Core Content of ERC-8004

The entry point for ERC-8004 is not in asset forms or transaction execution methods, but in whether authorization can be separately described, independently validated, and continuously managed at the system level.

2.1 What Does ERC-8004 Define?

According to the definition on the Ethereum Improvement Proposals (EIP) website: ERC-8004 is a standard protocol for discovering, selecting, and interacting with trustworthy autonomous agents on Ethereum. It builds agent infrastructure for decentralized interaction without prior trust through on-chain registration, reputation, and verification mechanisms.

Here, "autonomous agents" are not limited to AI Agents but refer to any entity that can be authorized and independently execute actions, such as contracts, automated scripts, multi-signature setups, or service processes. ERC-8004 focuses on whether an executing entity possesses the capability for clear authorization and defined permission boundaries, with AI Agents being just one typical application.

From a more general perspective, ERC-8004 is not a new asset standard or account type, but a framework for expressing and validating on-chain permissions. It describes what actions a subject is allowed to perform under which conditions and validates them before operations. Therefore, ERC-8004 is concerned not with "what money is" or "how transactions are executed," but with "which actions are permitted." It does not create new assets or change existing asset properties; it merely adds a layer of clear, verifiable permission rules on top of assets and accounts.

Furthermore, ERC-8004 is not a replacement for Account Abstraction (ERC-4337). Account Abstraction focuses on how transactions are executed, while ERC-8004 addresses permission judgments before a transaction occurs. If Account Abstraction makes accounts more flexible, ERC-8004 sets clear boundaries for that flexibility.

The core of ERC-8004 lies in transforming authorization from an action implied within a signature into a permission object that can be clearly described, independently validated, and continuously managed.

2.2 The Core Mechanism Framework of ERC-8004

To understand the core mechanism of ERC-8004, one can temporarily set aside complex technical implementations and think of it as an "on-chain permission manual." In traditional authorization logic, users often make a vague decision: "I allow you to operate my assets." As for what exactly can be done, how much, and for how long, the system does not further distinguish. Under the ERC-8004 framework, an authorization is no longer a vague agreement but is decomposed into a set of rules that can be clearly described and enforced by the system. This "permission manual" typically includes the following five categories of key information.

Authorized Subject (Who): Who is permitted to execute?

First, it must be clear who is granted execution permission. In ERC-8004, the authorized object is no longer limited to a fixed wallet address; it can also be a contract, an automated Agent, or even a Session Key for short-term operations. This allows authorization to adapt to more complex scenarios, such as allowing a specific strategy contract to operate within defined limits or enabling an Agent to complete specific tasks without repeated signatures. Importantly, permissions are always granted to "a clearly defined subject," not handed out vaguely.

Executable Actions (What): What operations are allowed?

Second, it defines which actions are permitted. Traditional authorization is often all-or-nothing; once authorized, the contract is implicitly allowed to make any calls within its scope. In ERC-8004's design, authorization can be precise to specific action types, such as only allowing swaps, transfers, or calls to a certain class of functions, rather than defaulting to all possible operations. ERC-8004 answers not just "can it be used," but "to what extent can it be used."

Constraints (Under what conditions): Under what conditions can execution occur?

This is a key part that distinguishes ERC-8004 from traditional authorization. In the permission manual, authorization typically comes with explicit constraints, such as: single or cumulative amount limits; execution frequency or count limits; restrictions to specific protocols, pools, or contract addresses. These conditions are not post-facto monitoring rules but prerequisites that must be satisfied before execution. If conditions are not met, the operation simply cannot be performed.

Activation and Deactivation Rules (When): When does the permission become active and when does it terminate?

ERC-8004 also introduces clear concepts of time and lifecycle. Authorization can be set to: (a) be valid only within a specific time window; (b) automatically expire after a single use; (c) be revocable at any time. This transforms authorization from a long-term burden that, once given, is hard to reclaim, into a temporary capability that can be finely managed.

Validation Method (How enforced): How are the rules actually enforced?

Finally, and most easily overlooked: how these rules are enforced. The core idea of ERC-8004 is to perform permission validation before an operation occurs. If an action does not comply with the pre-defined permission rules, the system will directly refuse execution, rather than assigning responsibility after a problem occurs. This is the fundamental difference between ERC-8004 and traditional risk control logic.

2.3 New Capability Types Introduced by ERC-8004: Why Wasn't This Possible Before?

On the surface, ERC-8004 merely makes authorization more granular, but early Ethereum authorization models actually could not express complex authorization logic. Traditional authorization only checks whether an address is permitted to operate. Once authorized, what can be done, how much, and when, cannot be recognized by the system.

The core breakthrough of ERC-8004 lies in upgrading authorization from "identity judgment" to "behavior judgment." The system begins to judge whether an operation complies with the user-defined permission boundaries, not just confirming who initiated it. This allows authorization to inherently include conditions like amount, frequency, scope, and validity period, without relying on user revocation or manual monitoring after the fact.

Once authorization logic is structured, it gains, for the first time, the ability to be composable and reusable. Multi-step, cross-protocol operations can be explicitly limited at the authorization stage, rather than left for judgment during execution. It is precisely for this reason that ERC-8004 truly opens up space for Agent scenarios. Automated programs no longer need "infinite authorization" but are confined to clear, verifiable behavioral boundaries; exceeding these boundaries results in denied execution.

What ERC-8004 adds is not simply "more secure authorization," but making authorization logic understandable and executable by the system. This is its essential distinction from traditional authorization mechanisms.

3. Potential Application Directions for ERC-8004

ERC-8004 is not a standard designed for a single specific product; it is more like a common language for authorization capabilities. Therefore, its application value is not reflected in the explosion of a single scenario, but in the common demand for the same type of capability across multiple systems as authorization becomes more complex.

DeFi: Moving from "Asset-Level Authorization" to "Behavior-Level Authorization"

In the current DeFi system, the most common authorization method is still "one-time approval, unlimited allowance." For example, a user needs to approve a contract before performing a swap, borrowing, or staking, essentially handing over overall control of the asset. This is efficient in terms of user experience but carries obvious risks: if the contract is upgraded, attacked, or used in logic the user did not anticipate, the authorization itself becomes a risk amplifier. ERC-8004 authorizes not assets, but specific behaviors. For instance, a user could specify: I do not allow this contract unlimited use of my USDC; rather, I allow it to perform one swap operation using no more than 1,000 USDC within 24 hours. While some projects have attempted to limit authorization scope and duration, these efforts are mostly fragmented. The value of ERC-8004 lies in standardizing behavior-level authorization, enabling reusable, composable permission management, and fundamentally enhancing risk control capabilities.

AI Agent: Providing Verifiable Permission Boundaries for Automated Execution

As AI Agents increasingly participate in on-chain decision-making and execution, the authorization issue is amplified to a new level. The value of Agents lies in continuous operation and automated execution, but this also means they must hold some form of operational permission long-term. Without clear permission boundaries, an Agent is essentially just an automated program with the user's full control, and risks are not reduced by its "intelligence." ERC-8004 provides Agents with a system-level, verifiable authorization boundary. What operations an Agent is authorized to perform, within what scope it can act, and whether there are time limits—these rules can be validated before execution, not reliant on post-facto monitoring. Only when permissions themselves are structured and verifiable does automated execution have a credible premise.

Synergy with the x402 Protocol: Making Agent Behavior "Authorizable and Settleable"

In Agent scenarios, another key issue beyond authorization is: how is value exchanged after an action is permitted? Some application-layer protocols are attempting to solve this, such as the x402 protocol, which re-enables the HTTP 402 (Payment Required) status code, allowing Agents to automatically complete stablecoin payments when requesting resources or services. In this architecture, ERC-8004 and x402 operate at different layers but form a complementary relationship. ERC-8004 focuses on "who can do what, and is it permitted," establishing permission and trust boundaries for behavior; x402 solves "how payment and settlement are completed when the behavior occurs." The former does not depend on the latter to function, nor does the latter require ERC-8004 as a prerequisite, but in the Agent economy, they respectively assume the roles of the permission layer and the payment layer. This layered collaboration enables Agents to complete the entire process from permission validation to value exchange without human intervention, also avoiding the complexity of mixing identity, authorization, and payment logic within the same system. As Agents become more active in scenarios like content acquisition, data calls, and computing services, this combination is poised to become a scalable foundational architecture.

Enterprise and RWA Scenarios: Permission as the Foundational Expression of Compliance

In enterprise applications and RWA scenarios, the value of ERC-8004 is more evident in compliance and explainability. Real-world asset management often requires clear answers to: who was authorized to perform which actions under what conditions. Compared to whether assets themselves are on-chain, how permissions are defined and recorded is often the key to entering traditional financial systems. ERC-8004 does not directly solve compliance issues, but it provides underlying support for the structured expression of permissions, making authorization inherently possess the possibility of being audited, traced, and validated. This capability won't immediately change the user experience but can significantly reduce the integration cost between Web3 systems and traditional organizations.

From these potential applications, it can be seen that ERC-8004 is not a "scenario-driven" standard but a foundational capability that naturally emerges as authorization complexity increases. When on-chain behavior evolves from single operations to continuously running system behaviors, a clear, verifiable way to express permissions is almost an unavoidable choice.

4. The Challenges and Long-Term Value of ERC-8004

Practical Challenges

First is the learning curve. Compared to clicking "approve" once, ERC-8004 introduces a more granular logic for describing permissions. Both developers and users need to re-understand the meaning of authorization within the system. This cognitive cost requires time for the market to absorb. Second is wallet and infrastructure support. The capabilities of ERC-8004 can only truly function when wallets, SDKs, and execution environments understand and cooperate. In the early stages, it is more like a usable but not universal capability, making it difficult to achieve network effects immediately. Finally, there is the user experience. Exposing complex authorization directly to users only increases operational burden. How to translate a set of structured, machine-verifiable permission rules into an interaction method that ordinary users can intuitively understand and are willing to accept will directly determine whether ERC-8004 has the potential for mass adoption.

ERC-8004 Addresses Not the Present, But the Next Stage

Precisely because of these practical barriers, ERC-8004 is not suitable as a short-term narrative tool. It will not immediately lead to an explosion in user numbers nor directly spawn new yield models. ERC-8004 does not attempt to make the world faster; rather, it aims to keep systems controllable, explainable, and verifiable even as they become more complex. Its value lies not in the number of features but in whether it reserves a sustainable, evolvable permission foundation for future automation, Agent collaboration, and institutional participation. In this sense, ERC-8004 is not a standard born for a particular market cycle but one of the underlying capabilities that determines whether Web3 can support complex collaborative relationships.

References

1. ERC-8004: Trustless Agents: https://