Hey friend 👋,

This’ll be a short update on some recent web3 news - a pretty big update happened this past week, but didn’t get nearly as much attention as events like The Merge did.

I believe the way we onboard billions to web3 is through:

1. 📗 Education - do folks understand why web3 is important and worth their time?

2. 🔨 Infrastructure - are the tools readily available for anyone to build applications easily and sought out value?

3. 🗞 Narrative Shift - are there more positive stories and credible use cases than negative ones?

The Merge certainly helped with some of those areas (especially #3, given the environmental implications of switching from Proof-of-Work (resource-intensive) to a Proof-of-Stake system - reducing the environmental impact by 99.5%), but the ERC-4337 update helps with #2.

I’m going to break down what it is, why this is important in simple terms, and what this means for web3.

Let’s get to it!

🤔 What is ERC-4337?

ERC-4337 is about introducing Smart Accounts to the Ethereum Blockchain (another term that’s been bandied about is “account abstraction”, but see below for more on this).

For a new user to interact with the blockchain, they must: create a wallet, store their private keys, purcahse & transfer funds, pay gas fees, and sign every single action that they take on a dApp. Talk about alottaaa work.

Enter “account abstraction” - the next evolution in web3 wallets that unlocks the potential of “smart contract wallets”.

It provides a much smoother experience and enables some pretty powerful use cases on Ethereum:

• Automatically creating wallets for users when they sign up (on the backend, without them even realising)

• Removing the need for users to sign every transaction (creating a smoother UX in web3 games or social platforms)

• Enabling team wallets to interact with dApps more easily, with tiered permissions

Let’s dive into the use cases in more detail.

Use cases:

1️⃣: What if I lost or Someone Steals My Wallet Password?

ERC-4337 has the potential to provide the same UX of a bank - where e.g. a friend or a lawyer can always help recover your account via Social Recovery.

No more losing your crypto when you lose your keys 🙏.

It’s pretty impossible to expect regular folk to write down and securely store 12-24 words - ERC-4337 allows for “more normal” recovery options, closer to traditional banking.

By being able to use a friend or someone you know to help with gaining access to an account, it becomes significantly easier to onboard mainstream users. Obviously, there are some security risks, but it seems a worthy tradeoff for adoption.

2️⃣: What about Gas Fees?

Gasless transactions are cool, because you don’t want to be playing a game or interacting on the Lens social platform, and have to be interrupted by paying for gas fees and signing transactions. It should be embedded and seamless in the game’s native play.

4️⃣: What about our beloved 2FA?

Yup, Account Abstraction means you can add more controls or features to your wallet. e.g. adding two-factor authentication when you spend above a certain limit. Also, we can customize authenticated users who can use a fingerprint or face scan.

Closing Thoughts:

Account Abstraction creates a massive unlock for dramatically improving the web3 user experience across applications and protocols.

Companies like Safe are already implemeting the account abstraction (AA) standard - their new AA SDK, alongside companies like Stripe, will offer developers direct access to a wide range of integrations, enabling web3 apps across use cases to offer web2-like UX.

We’re going to hear a lot more about how this functionality will be used - I think a lot of people aren’t privy to how powerful this update is. The possibilities are endless.

Onwards 🚀

🔗 Links Of The Week

🧘🏽‍♂️ Playing a Career Game You Actually Want to Win

This is a constant theme of mine and I love reading posts around this theme - the key question asked: “If you decided to go to grad school, but you couldn’t tell anyone that you went, would you still do it?”.

⚡️How Four Scientists Created Gatorade and Became Billionaires

Crazy story of how Gatorade became a household brand and it’s early beginnings - let’s just say the University of Florida are probably kicking themselves now.

💡 Examples of Doing Things that Don’t Scale

Examples of growth hacks from Reddit, Glossier and an author on doing the early work to scale later.

🖼 In a Meme:

For the pictorially inclined, here’s the whole piece in a single meme:

For those Twitterly-inclined (def not a word), here’s a great twitter thread re this week’s post:

Until next time 👋

I hope you enjoyed this week’s edition - I'd love it if you shared it with a friend or two.

Got feedback? Reply to this email or tweet at me and let’s chat.

Fahim