Why Interchain Accounts Will Make Hubs the Default Wallets of Web3

Users manage dozens of private keys across chains, creating security nightmares and UX friction. Wallet drainers exploit this complexity, while DeFi composability is limited to single chains.

• ~$1B+ lost annually to cross-chain bridge & wallet hacks.
• Zero native ability for an app on Chain A to control assets on Chain B.
• User experience is a chain-hopping nightmare, killing mainstream adoption.

The Inter-Blockchain Communication (IBC) protocol provides a secure, permissionless messaging layer. Interchain Accounts build on top, allowing a chain (the controller) to programmatically create and control an account on another chain (the host).

• Hub-as-Wallet: A Cosmos Hub account can execute swaps on Osmosis, stake on Stride, and vote on Neutron—all from one interface.
• Secure by Design: Leverages IBC's light client security, eliminating trusted bridges.
• Composability Unlocked: Enables true cross-chain smart contract calls and automated strategies.

Neutron implements Interchain Queries and Interchain Transactions, turning the Cosmos Hub into a smart contract powerhouse. It's the execution layer for the hub-as-wallet vision.

• Permissionless Composability: Any CosmWasm contract on Neutron can securely trigger actions on any IBC-connected chain.
• Revenue Capture: Fees from cross-chain activities accrue to the Cosmos Hub stakers.
• Real-World Use: Enables cross-chain liquid staking with Stride, leveraged yield farming, and interchain DAOs.

The hub-as-wallet thesis extends beyond Cosmos. Celestia's modular data availability enables rollups to use it as a secure settlement and messaging hub. EigenLayer transforms Ethereum into a hub for restaking and AVS services.

• Celestia as Coordinator: Rollups use Celestia for DA and can trustlessly message each other, creating a rollup wallet ecosystem.
• Ethereum as Economic Hub: EigenLayer restakers provide security to external chains (AVSs), making Ethereum the capital wallet for the modular stack.
• Convergence: Both models compete to be the trust root and coordination layer for thousands of chains.

Interchain Accounts are the primitive for intent-based architectures. Instead of signing individual transactions, users express desired outcomes (e.g., "get the best yield"). The hub becomes the solver.

• Abstracted Execution: Hub uses ICAs to source liquidity from Osmosis, Uniswap, Curve and execute the optimal route.
• Parallels to UniswapX: Similar to off-chain intent solving, but with on-chain security guarantees via IBC.
• Future Proof: Paves the way for cross-chain account abstraction (AA) where gas is paid in any asset from any chain.

ICA solves control, not liquidity. Moving value between accounts still requires cross-chain transfers, which are slow and capital inefficient. The winning hub must solve this.

• Capital Lockup: IBC transfers require ~3-day unbonding for security, tying up funds.
• Competition: Fast, risky bridges like LayerZero, Axelar, Wormhole offer better UX for liquidity movement today.
• Solution Path: Native Interchain Security for shared validation and emerging concepts like Interchain Schedulers for atomic composability.

Interchain Accounts (ICA) solve for programmability but not for the onboarding and key management that defines wallet UX. The average user doesn't care about composability if they still need a dozen gas tokens.\n- Key Risk: Mass adoption requires abstracting gas and key management across all chains, a problem ICA alone doesn't solve.\n- Competitor: Smart contract wallets (ERC-4337) and MPC solutions are solving this from the application layer, potentially leapfrogging ICA's infrastructure-first approach.

ICA moves security upstream to the host chain (e.g., Cosmos Hub). This creates a systemic risk concentration where a compromise or governance attack on the hub could cascade to all connected chains.\n- Key Risk: Contradicts the core Web3 ethos of sovereignty and fault isolation. Chains may resist ceding this control.\n- Precedent: The Cosmos Hub's $ATOM security tax debate highlights the political friction in becoming a universal security provider.

ICA is a generalized messaging primitive, but users and dApps gravitate to the fastest/cheapest solution for a specific task. Specialized intent-based bridges (Across, LayerZero) and DEX aggregators (UniswapX, CowSwap) offer better UX for singular actions like swaps.\n- Key Risk: ICA becomes backend plumbing while user-facing aggregation happens elsewhere, relegating hubs to a commodity layer.\n- Metric: If >60% of cross-chain volume flows through non-ICA routes, the 'default wallet' thesis fails.

Providing secure, reliable ICA infrastructure is a public good with real cost. The hub must capture value to incentivize validators, but value capture mechanisms are unclear and contentious.\n- Key Risk: Without a clear fee market or revenue share, hub security stagnates, making it unattractive for high-value chains.\n- Example: The 'Interchain Scheduler' is a proposed solution, but its adoption and revenue potential are unproven.

ICA requires chains to implement the IBC protocol and cede control over account logic to an external hub. Sovereign chains (e.g., dYdX Chain, Celestia rollups) may prioritize native performance and customizability over interoperability convenience.\n- Key Risk: The most valuable app-chains build their own user-facing entry points, fragmenting the landscape ICA aims to unify.\n- Entity: dYdX V4 built its own chain with a bespoke orderbook, not a generic ICA setup.

ICA enables atomic multi-chain transactions, but debugging a failed transaction that touched 5 different state machines is a developer's nightmare. Liability, error handling, and state reconciliation become exponentially harder.\n- Key Risk: This complexity stifles developer adoption. Teams will opt for simpler, single-chain or bilateral bridge solutions despite inferior UX.\n- Result: ICA's most powerful feature—atomic composability—may see limited real-world use due to operational overhead.