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wallet-wars-smart-accounts-vs-embedded-wallets
Blog

Why Session Keys Are a Protocol Problem, Not an App Problem

App-specific session key implementations are creating a new generation of walled gardens and security vulnerabilities. We argue that portable, protocol-level session key standards are the only viable path forward for mainstream adoption.

introduction
THE FRAGMENTATION

Introduction: The UX Mirage of App-Specific Keys

Session keys improve UX by eliminating per-transaction signatures, but their app-specific implementation creates a new layer of user friction.

App-specific keys fragment identity. Each dApp (e.g., dYdX, Uniswap) issues its own session key, forcing users to manage separate, non-portable permissions for identical actions across different interfaces.

The problem is protocol-level. Wallet standards like ERC-4337 and ERC-7579 abstract account logic, but session key management remains an application responsibility, creating redundant security setups.

This mirrors early DeFi fragmentation. Isolated liquidity pools preceded Uniswap V3 and Curve; isolated key systems now precede a native wallet-layer standard.

Evidence: A user interacting with ten dApps must configure and track ten distinct session key policies, a complexity that scales linearly and defeats the UX purpose.

deep-dive
THE ARCHITECTURAL MISMATCH

The Core Argument: Why This is a Protocol Problem

Session keys expose a fundamental protocol-level gap in account abstraction, forcing applications to build insecure, non-portable workarounds.

Session keys are a protocol problem because the EVM lacks native state for ephemeral permissions. This forces every dApp, from Uniswap to Friend.tech, to re-implement custom, non-custodial key management off-chain, creating systemic fragmentation and security risk.

The wallet is the wrong abstraction layer. Wallets like Safe{Wallet} or Rabby manage long-term identity, not temporary transaction intents. Pushing session logic into the application layer creates incompatible standards and breaks user experience across chains.

Evidence: The proliferation of incompatible MPC-TSS providers like Privy and Dynamic for app-specific sessions proves the market demand, but their siloed implementations highlight the protocol's failure to provide a unified primitive.

SESSION KEY ARCHITECTURES

The Cost of Fragmentation: A Comparative Analysis

Comparing the systemic impact of implementing session keys at the application layer versus the protocol layer.

Key Metric / CapabilityApp-Level Implementation (e.g., dApp Wallets)Protocol-Level Implementation (e.g., Native Account Abstraction)Ideal Unified Standard (ERC-4337 / RIP-7560)

User Onboarding Friction

Per-dApp signup & key generation

Single signup, universal across dApps

Single signup, universal across dApps

Security Surface Area

High (multiple independent key managers)

Low (single, audited protocol primitive)

Low (single, audited protocol primitive)

Developer Integration Overhead

High (custom integration per dApp)

Zero (native wallet support)

Low (standardized SDKs & tooling)

Cross-DApp Session Portability

Gas Sponsorship & Fee Logic

Bespoke, non-composable

Native protocol primitive

Native & standardized

Average User Gas Cost per Session

$2-5 (recurring approvals)

< $0.50 (batched, sponsored ops)

< $0.50 (batched, sponsored ops)

Time to First Transaction (New User)

60 seconds

< 5 seconds

< 5 seconds

Audit & Compliance Burden

Fragmented, per application

Centralized on protocol clients

Centralized on standard implementation

risk-analysis
SESSION KEY VULNERABILITY

The Security Blind Spots No One is Talking About

The industry's push for UX has offloaded critical security decisions from protocols to applications, creating systemic risk.

01

The Problem: App-Level Implementation is a Fragmented Mess

Every dApp (e.g., dYdX, Zerion) implements its own session key logic, creating a patchwork of security models. This leads to inconsistent revocation mechanisms, opaque permission scopes, and no standardized audit surface.

  • Inconsistent Standards: One app's "unlimited spend" is another's "10 ETH cap".
  • Audit Fatigue: Security firms must re-audit the same primitive for every new client.
  • User Confusion: No universal UI/UX for reviewing or revoking active sessions.
100+
Unique Implementations
0
Universal Standard
02

The Solution: Protocol-Native Session Primitives

Session keys must be a first-class primitive at the chain or account abstraction layer, akin to how ERC-4337 standardized account abstraction. This moves security logic out of app code and into the protocol's security model.

  • Standardized Permissions: Define scopes (value, time, contract) at the protocol level.
  • Universal Revocation: A single user action (e.g., at the Safe{Wallet} level) kills all sessions.
  • Composable Security: Enables cross-app session aggregation and risk scoring by protocols like Chainscore.
1
Standard Interface
-90%
Attack Surface
03

The Consequence: Silent Systemic Risk in DeFi

Fragmented app-level sessions create a systemic risk layer across DeFi. A compromise in one dApp's session logic (e.g., a Perpetual Protocol vault) can cascade, as users often reuse keys or wallets across platforms.

  • Cross-Contamination: A gaming session key with broad permissions could drain a linked Aave position.
  • Opaque Exposure: Users cannot holistically view their active financial delegations.
  • Protocol Liability: Underlying chains (e.g., Ethereum, Solana) bear the reputational risk for app-layer failures.
$10B+
TVL at Indirect Risk
24-48h
Avg. Detection Time
04

The Entity: ERC-4337 and the Missed Opportunity

ERC-4337 introduced a standard for account abstraction but punted on session keys, leaving it to "higher-level standards." This was a critical oversight, as it's the dominant framework for smart accounts (Safe, Biconomy).

  • Architectural Gap: The UserOperation mempool is secured, but the session granting logic is not.
  • Fragmented Adoption: Competing proposals (ERC-7377, RIP-7560) now try to fill the void, causing more fragmentation.
  • Window Closing: As AA gains mass adoption, retrofitting a standard becomes exponentially harder.
7M+
AA Accounts
3+
Competing Standards
05

The Precedent: How L2s Solved Data Availability

The evolution of Ethereum L2s (Arbitrum, Optimism) provides a blueprint. They initially had custom, insecure fraud proofs. The solution wasn't better app code, but protocol-level standardization via EIP-4844 and shared DA layers (Celestia, EigenDA).

  • Move Up the Stack: Push critical security guarantees to a lower, more auditable layer.
  • Economic Security: Anchor trust in the base layer's consensus, not individual dApp teams.
  • Collective Benefit: A standard security primitive becomes a public good that boosts the entire ecosystem.
100x
Cheaper DA
L1 Security
Inherited Guarantee
06

The Action: Demand Protocol-Level Specifications

CTOs and architects must pressure core development teams (Ethereum Foundation, Solana Foundation, StarkWare) to prioritize session key primitives in upcoming upgrades. This is not a feature—it's a mandatory infrastructure layer.

  • Roadmap Pressure: Make session standards a requirement for L2 grant funding or partnership.
  • VC Mandate: Invest in protocols solving this, not another dApp with custom key logic.
  • Audit Focus: Redirect security budget from app reviews to contributing to and auditing the base standard.
Next Hard Fork
Target for EIP
Shift Budget
Required Action
future-outlook
THE INTEROPERABILITY IMPERATIVE

The Path Forward: Protocol-Level Standards

Session key fragmentation is a systemic risk that demands protocol-level standardization, not isolated application fixes.

Session keys are a protocol problem because their current application-specific implementation creates a fragmented user experience and security model. Each dApp, from Uniswap to Blur, reinvents its own key management, forcing users to manage dozens of isolated permissions.

Standardization enables interoperability across wallets and dApps, similar to how ERC-20 created a universal token standard. A common session key standard would allow a single key to interact with multiple protocols, reducing friction and cognitive load.

The precedent exists with intents. The success of intent-based architectures like UniswapX and CowSwap demonstrates that abstracting complex execution into a shared protocol layer improves efficiency and user outcomes. Session keys are the logical next abstraction.

Evidence: The proliferation of over 50 different account abstraction SDKs (Biconomy, ZeroDev, Pimlico) highlights the demand for, and current chaos in, user operation management. A unified standard consolidates this effort.

takeaways
WHY SESSION KEYS ARE A PROTOCOL PROBLEM

TL;DR: Key Takeaways for Builders and Investors

Session keys are a critical UX primitive, but their current fragmented, app-specific implementation is a systemic risk and a scaling bottleneck. The future is standardized, protocol-level infrastructure.

01

The Fragmentation Tax

Every dApp reinventing its own session key wallet creates security debt and user friction. This is a massive waste of developer resources and a poor security model.

  • Security Debt: Each app's custom implementation is a new attack surface.
  • User Friction: Users manage dozens of isolated, non-portable keys.
  • Dev Burden: Teams spend months on security audits for a solved problem.
100+
Custom Impls
~$5M+
Audit Costs
02

ERC-7579 & The Standardization Path

Minimal, modular standards like ERC-7579 are the exit ramp. They define a common interface for session keys, enabling portable security modules and wallet interoperability.

  • Modular Security: Plug in different validation logic (e.g., spending limits, time windows).
  • Wallet Portability: A user's session key policy works across any compliant dApp.
  • Composability: Enables new primitives like account abstraction-powered intents.
1 Standard
Many Wallets
-80%
Integration Time
03

The Infrastructure Layer Opportunity

This is a play for the next smart account infrastructure layer. The winner provides the secure, generalized runtime for session management, not the dApp.

  • Protocol Revenue: Fee capture from securing $10B+ in delegated assets.
  • Network Effects: Security modules and policies become composable lego blocks.
  • Strategic Moat: Becomes the default trust layer for intent-based systems (UniswapX, Across) and gaming.
New Layer
Market Cap
10x
UX Scale
04

Security is Not Additive

Baking security into the protocol layer is non-negotiable. A breach in one app-specific implementation shouldn't cascade, and users should have universal revocation.

  • Containment: Isolated module failures don't drain the main wallet.
  • Universal Revoke: A single action invalidates sessions across all dApps.
  • Audit Once, Secure Everywhere: A vetted protocol module benefits all integrators.
1 Audit
100 dApps
Zero-Trust
Default State
05

Killer Use Case: Mass Adoption UX

Protocol-level session keys unlock web2-grade UX for blockchain applications. This is the prerequisite for the next 100M users in gaming and social.

  • Gasless Transactions: Sponsorship models become trivial.
  • One-Click Interactions: No pop-up for every action; think "Play" not "Sign".
  • Cross-Chain Sessions: A single session policy can span Ethereum, Solana, and Layer 2s via interoperability protocols.
~500ms
Interaction Speed
0 Signatures
Per Game Session
06

The Investor Lens: Bet on the Rail

Invest in the protocol enabling the abstraction, not the dApps building atop it. This mirrors the AWS or Stripe playbook: capture value from ecosystem growth.

  • Recurring Revenue Model: Fees from session validation and key management.
  • Ecosystem Capture: Value accrues to the foundational trust layer.
  • Defensible: Standards and network effects create a protocol moat that outlasts any single application.
Platform
Not App
>50%
Margin Profile
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Session Keys Are a Protocol Problem, Not an App Problem | ChainScore Blog