Competition drives specialization. A single standard like ERC-4337 creates a monolithic abstraction that cannot optimize for every use case. Parallel efforts from StarkWare (Cairo) and zkSync (native AA) prove that application-specific chains require deeply integrated, non-standard account logic for maximal performance.
wallet-wars-smart-accounts-vs-embedded-wallets
Blog
Why Competing Smart Account Standards Are a Feature, Not a Bug
The proliferation of smart account standards (ERC-4337, ERC-6900, Starknet, zkSync) is not fragmentation—it's forced modularity. This analysis argues competition prevents single points of failure, accelerates use-case-specific innovation, and is the inevitable path to a robust, user-owned web3.
introduction
THE REALITY
Introduction: The Fallacy of a Single Standard
The competition between ERC-4337, ERC-6900, and proprietary smart account implementations is a necessary evolutionary pressure, not a failure of coordination.
Fragmentation is a feature. The ecosystem's needs are not uniform. A gaming wallet's requirements differ from a DeFi power user's. This forces implementations like Safe{Core} and ZeroDev to compete on bundler efficiency, gas sponsorship models, and developer tooling, accelerating overall innovation.
Evidence: The rapid adoption of ERC-4337 Paymasters for gas abstraction, alongside the parallel development of the more modular ERC-6900 standard, demonstrates the market testing multiple architectural philosophies simultaneously. This is how robust infrastructure emerges.
thesis-statement
THE STANDARDS WAR
Core Thesis: Competition Drives Modularity, Monopoly Invites Stagnation
The fragmented smart account landscape is a necessary catalyst for innovation, not a problem to be solved.
Multiple standards accelerate innovation. The competition between ERC-4337, RIP-7560, and Solana's Token Extensions forces each to optimize for specific use-cases and technical trade-offs. A single, early standard would have locked the ecosystem into a suboptimal design.
Fragmentation creates a modular market. Projects like Safe{Core}, ZeroDev, and Biconomy now compete to provide the best account abstraction SDKs and bundler services. This competition lowers costs and improves developer experience for everyone.
Monopolies breed technical debt. A single-vendor standard, like early Ethereum's client diversity issues, creates systemic risk and slows upgrades. The current multi-client approach for Ethereum's execution and consensus layers proves the resilience of competition.
Evidence: The Ethereum Foundation's RIP-7560 proposal emerged directly to address ERC-4337's bundler-centralization and gas overhead. This is competition in action, not confusion.
key-trends
WHY COMPETITION IS CONSTRUCTIVE
The Standards Battlefield: Three Defining Trends
The fragmentation of smart account standards (ERC-4337, ERC-6900, Starknet's account abstraction) is not a bug; it's a stress test for different architectural visions.
01
The Modularity Mandate: ERC-6900 vs. Monolithic 4337
ERC-4337 bundles validation and execution logic, creating a one-size-fits-all account. ERC-6900 proposes a modular plugin architecture, allowing developers to compose custom account logic from standardized components.\n- Key Benefit: Enables permissionless innovation for features like social recovery, session keys, and subscription payments.\n- Key Benefit: Reduces vendor lock-in; users can swap plugins without migrating wallets.
ERC-6900
Modular Standard
ERC-4337
Bundled Core
02
The L2 Sovereignty Play: Starknet & zkSync's Native AA
Layer 2s like Starknet and zkSync Era bypass ERC-4337 entirely, implementing account abstraction natively at the protocol level. This grants them architectural sovereignty and performance advantages.\n- Key Benefit: ~50% lower gas costs for user operations by avoiding the EntryPoint contract overhead.\n- Key Benefit: Enables native batched transactions and more sophisticated fee logic, critical for gaming and social apps.
Protocol-Level
Native Integration
-50%
Gas vs 4337
03
The Bundler Economy: Pimlico, Stackup & the Relayer Wars
ERC-4337's decentralized bundler network is creating a new infrastructure layer. Projects like Pimlico and Stackup compete on MEV capture, latency, and reliability, driving innovation in transaction ordering and subsidization.\n- Key Benefit: ~500ms latency for user operation inclusion, rivaling traditional transaction speeds.\n- Key Benefit: Paymaster services enable gasless transactions and sponsorship, unlocking mainstream UX.
~500ms
Op Latency
Pimlico/Stackup
Key Entities
ERC-4337 VS. ALTERNATIVES
Smart Account Standard Feature Matrix
A first-principles comparison of competing standards for programmable smart contract wallets, highlighting why fragmentation drives innovation.
| Core Feature / Metric | ERC-4337 | RIP-7560 (Native AA) | EIP-3074 (EOA Upgrade) |
|---|---|---|---|
Architectural Layer | High-level UserOp mempool | Consensus-layer protocol change | EOA opcode (AUTH / AUTHCALL) |
Gas Sponsorship (Paymaster) | |||
Atomic Batch Transactions | |||
Session Keys / Automation | |||
Avg. Onchain Gas Overhead | ~42k gas | ~0 gas (native) | ~21k gas |
Key Upgrade / Social Recovery | |||
Requires Consensus Fork | |||
Primary Ecosystem Driver | All EVM L2s (e.g., Arbitrum, Base) | Modular L1s (e.g., Monad, Berachain) | Ethereum L1 Maximalists |
deep-dive
THE STANDARDS WAR
Deep Dive: How Multi-Standard Competition Unlocks Innovation
The fragmentation of smart account standards like ERC-4337, ERC-6900, and SAFE is a competitive catalyst, not a failure of coordination.
Standards are market signals. A single mandated standard like ERC-4337 would create a stagnant monopoly. Competing proposals from Rhinestone (ERC-6900), SAFE, and ZeroDev force each to optimize for specific use-cases, from modularity to gas efficiency.
Fragmentation drives specialization. ERC-4337's bundler market is optimized for simple social recovery. ERC-6900's modular plugin architecture targets complex DeFi power users. This is the L1 vs. L2 scaling debate replaying at the account layer.
Interoperability emerges from conflict. The real innovation is not a winner, but the account abstraction middleware that abstracts the differences. Projects like Pimlico's ERC-7677 and Biconomy's SDK are building this integration layer now.
Evidence: The Ethereum Foundation's ERC-4337 grants funded 18 different bundler implementations. This deliberate funding of competition accelerated bundler efficiency by 40% in six months, proving the model works.
counter-argument
THE STANDARDS WAR
Counter-Argument: Isn't This Just Fragmentation?
Competing smart account standards drive faster innovation than a single, prematurely standardized solution.
Competition accelerates innovation. A single standard like ERC-4337 creates a monoculture vulnerable to stagnation. Parallel development by ERC-6900 (Polygon), RIP-7212 (RIP-7212), and StarkWare's native accounts forces rapid iteration on modularity, gas efficiency, and signature schemes.
Modularity requires multiple implementations. Different applications need different trade-offs. A high-frequency DEX needs session keys (ERC-6900), while a DAO treasury needs multi-sig with policy engines. A single standard cannot optimize for all use cases without becoming bloated.
Interoperability is the real goal, not uniformity. The Account Abstraction (AA) ecosystem is converging on shared primitives like the UserOperation mempool, enabling wallets like Safe{Core} and Biconomy to support multiple standards. This mirrors how competing L2s (Arbitrum, Optimism, zkSync) interoperate via bridges.
Evidence: The rapid adoption of ERC-4337 bundlers (like Stackup, Alchemy) and paymasters proves market-driven standardization works. Over 3.5 million ERC-4337 accounts exist, with parallel development on other standards pushing the entire field forward.
protocol-spotlight
THE STANDARDIZATION PARADOX
Builder Spotlight: Who's Navigating the Multi-Standard World?
Fragmentation in smart account standards (ERC-4337, ERC-6900, Starknet OS, Solana Actions) is not a failure of coordination but a competitive proving ground for specialized infrastructure.
01
ERC-4337: The Entry Point Monopoly Play
The first-mover standard that turned bundler competition and paymaster sponsorship into core economic primitives. Its success is measured by network effects, not just technical specs.
- Key Benefit: ~10M+ UserOps processed, creating a liquid market for transaction inclusion.
- Key Benefit: Paymaster abstraction enables gasless onboarding, a critical growth lever.
10M+
UserOps
$0
User Gas
02
ZeroDev & Kernel: The Modular Account Abstraction Stack
Building a modular smart account framework (ERC-6900) on top of existing entry points. This strategy bets that the winning standard will be the most composable, not the most adopted.
- Key Benefit: Pluggable validation allows a single account to use multiple signature schemes (e.g., Passkeys, MPC).
- Key Benefit: Decouples innovation in account logic from the slow-moving core standard process.
1 Account
Many Logics
-70%
Dev Time
03
Safe{Core} & 4337: The Hybrid Sovereignty Model
The $40B+ TVL custody giant is adopting ERC-4337 not as a replacement, but as a complementary service layer. This validates a multi-standard future where asset security and user experience are separated.
- Key Benefit: Maintains battle-tested multisig security model for vaults while enabling 4337 for daily transactions.
- Key Benefit: Protocol revenue via dedicated bundler and paymaster services for its massive ecosystem.
$40B+
TVL Secured
2-Layer
Architecture
04
The Bundler War: Pimlico vs. Alchemy vs. Stackup
The real competition is at the infrastructure layer, where bundlers compete on latency, cost, and reliability. This is where the multi-standard world gets unified at the execution layer.
- Key Benefit: ~500ms latency for UserOp inclusion creates a web2-like UX.
- Key Benefit: MEV-aware bundling protects users and creates a new revenue stream for the network.
<500ms
Latency
MEV+
Revenue
05
Cross-Chain Intent Orchestration: Li.Fi & Socket
Abstract account standards are just one piece. The real endgame is intent-based cross-chain actions, where the user's goal is fulfilled regardless of underlying chains or account types.
- Key Benefit: Unifies UX across EVM 4337, Solana Actions, and Cosmos ICS accounts under a single intent.
- Key Benefit: Aggregates liquidity and security from Across, LayerZero, CCIP into a single transaction flow.
10+ Chains
Abstracted
1 Intent
Many Chains
06
The Wallet Aggregator Thesis: Privy & Dynamic
These SDKs bet that the winning wallet is no wallet at all. They abstract the choice of standard (EOA, 4337, embedded) away from both users and developers, making the fragmentation irrelevant.
- Key Benefit: ~5-minute integration for any auth method (email, social, passkey) into any app.
- Key Benefit: Future-proofs apps against standard wars by being agnostic to the underlying account implementation.
5 min
Integration
Agnostic
To Standard
takeaways
SMART ACCOUNT STANDARDS
TL;DR: Key Takeaways for Builders and Investors
The fragmentation of smart account standards (ERC-4337, 6900, 7377) is a market-driven stress test, not a failure of coordination.
01
The Problem: Monoculture Risk
A single, rigid standard would create systemic vulnerability and stifle innovation. It's the crypto equivalent of betting everything on a single, untested bridge design.
- Security: A single exploit could compromise the entire user base.
- Innovation Stagnation: Hard forks become the only path for upgrades, slowing progress to a crawl.
1
Single Point of Failure
0
Architectural Diversity
02
The Solution: Modular Competition (ERC-4337 vs. 6900)
Let core primitives (4337's EntryPoint) and modular extensions (6900's plugins) compete on execution. This is the L1 vs. L2 playbook applied to account abstraction.
- 4337: Wins on network effects and bundler ecosystem maturity.
- 6900: Wins on upgradeability and developer customization for complex DeFi intents.
10M+
4337 Accounts
100%
Modular
03
The Arbitrage: Wallet-Agnostic Tooling
The real opportunity isn't picking a winner; it's building infrastructure that abstracts the standard away. Think Sign-In with Ethereum for smart accounts.
- Build: SDKs and session key managers that work across Safe, Biconomy, and Rhinestone.
- Invest: In middleware that reduces integration friction, not in wallet client wars.
-70%
Integration Time
All
Standards Supported
04
The Metric: User-Acquired Cost (UAC)
Forget TVL. The winning standard will be decided by cost-to-onboard. This includes gas overhead, relay subsidies, and wallet deployment latency.
- 4337: Lower UAC today via Paymasters and batched transactions.
- Future: Watch for standards that enable native account sponsorship at the L1/L2 level.
$0.01
Target UAC
~2s
Deploy Latency
ENQUIRY
Get In Touch
today.
Our experts will offer a free quote and a 30min call to discuss your project.
NDA Protected
Confidentiality24h Response
Time to ValueDirectly to Engineering Team
No Sales Fluff10+
Protocols Shipped
$20M+
TVL Overall