Gas Credit Model

The core function where a third party, typically the dApp developer or a relayer, pays the network gas fees on behalf of the user. This abstracts the need for the end-user to hold or manage the native token (e.g., ETH, MATIC) for transaction costs, significantly lowering the barrier to entry.

• Paymaster Systems: Common in EVM-based account abstraction (ERC-4337), where a paymaster contract sponsors gas.
• Session Keys: Allow users to pre-approve a set of transactions with a capped gas budget, sponsored by the dApp.

Models where users are extended a line of credit for gas fees, which is settled later in a different currency or token. This separates the act of transacting from the act of paying fees.

• Off-Chain Credit: A service provider fronts the gas cost, and the user settles the debt via traditional payment rails (credit card, ACH) or stablecoins.
• On-Chain Deferred Payment: Fees are recorded as debt in a smart contract and repaid automatically from the user's account assets in a subsequent transaction.

Enables payment of network fees with tokens other than the blockchain's native currency. This reduces friction for users whose primary holdings are in stablecoins (USDC, DAI) or other ERC-20 tokens.

• ERC-20 for Gas: The paymaster accepts a user's ERC-20 tokens, instantly swaps them for the native gas token via a DEX aggregator, and pays the fee.
• Fixed-Rate Pricing: Users can pay fees in a stablecoin at a predictable rate, insulating them from native token price volatility during transaction execution.

Aggregates multiple user operations into a single blockchain transaction to amortize and reduce the total gas cost. This is a key efficiency feature of rollups and account abstraction bundles.

• UserOperation Bundling: In ERC-4337, a bundler packages multiple UserOperations from different senders into one transaction, sharing the base fee cost.
• Gas Overhead Reduction: By sharing calldata and single verification logic, the cost per user operation is lower than individual transactions.

Critical systems to prevent economic attacks on the sponsoring entity, ensuring the model is sustainable.

• Rate Limiting & Allowlists: Restricting gas credit to verified users or capping usage per account/time period.
• Staked Deposits: Paymasters must stake funds in the system, which can be slashed for malicious behavior.
• Transaction Policy Rules: Smart contracts enforce rules (e.g., max gas per transaction, allowed destinations) before sponsoring a user's op.

Gas credits are inherently linked to smart contract accounts (ERC-4337) and EIP-3074 'auth' calls, which decouple transaction validation and fee payment logic from the standard Externally Owned Account (EOA) model.

• Smart Account Wallets: User accounts become programmable contracts that can delegate fee payment to a separate module.
• Unified Experience: Enables features like social recovery, multi-signature rules, and gas sponsorship to coexist within a single wallet interface.

The model relies on relayers or paymasters to sponsor transactions. This creates a dependency on their availability and honesty. Key risks include:

• Censorship: A malicious or compromised relayer can selectively refuse to process transactions.
• Single Point of Failure: Downtime of a dominant relayer can halt user operations.
• Trust Assumption: Users must trust the relayer not to front-run or manipulate their transactions.

An attacker can deliberately exhaust a contract's or sponsor's allocated gas credit, causing a Denial-of-Service (DoS).

• Spam Attacks: Flooding the network with transactions that consume the credit pool.
• Resource Starvation: Legitimate users are blocked because the gas budget is depleted.
• Mitigation: Requires robust rate-limiting, stake-based slashing, and circuit breakers in the credit logic.

Decoupling payment from execution complicates signature validation. Risks include:

• Replay Attacks: A signed user operation might be replayed across different chains or contexts if the nonce or chainId is not properly enforced.
• Malleable Signatures: Weak signature schemes (e.g., without EIP-1271 for contracts) can be forged.
• Solution: Implement EIP-712 typed structured data signing and rigorous signature verification in the EntryPoint contract.

The financial flows between user, sponsor, and network must be secure and incentive-compatible.

• Stuck Transactions: If gas prices spike, a transaction may not have enough credit to complete, potentially leaving state changes partially applied.
• Sponsor Rug Pulls: A sponsor could withdraw staked funds or revoke credit abruptly.
• Oracle Risk: Models relying on gas price oracles for budgeting are vulnerable to oracle manipulation.

The Gas Credit Model is implemented in smart contracts (e.g., Paymasters, Account Abstraction wallets), which inherit all standard risks.

• Logic Bugs: Flaws in credit calculation, withdrawal, or replenishment logic.
• Access Control: Improperly permissioned functions could allow unauthorized credit minting or draining.
• Upgradability Risks: Malicious upgrades to proxy contracts controlling credit systems.

Simplifying gas for users can inadvertently reduce security vigilance.

• Phishing: Users may sign malicious UserOperation objects without verifying gas parameters, as they aren't paying directly.
• Approval Fatigue: Auto-replenishing credits might lead to overly broad token approvals on the sponsoring contract.
• Best Practice: Wallets should clearly visualize the sponsor, credit limits, and transaction data before signing.

Gas is the fundamental unit of computational work on a blockchain network, representing the fee required to execute a transaction or smart contract. It is paid in the network's native cryptocurrency (e.g., ETH on Ethereum). Key aspects include:

• Gas Price: The amount of cryptocurrency paid per unit of gas, set by the user.
• Gas Limit: The maximum amount of gas a user is willing to spend on a transaction.
• Base Fee: The minimum gas price set by the protocol, burned after EIP-1559. Gas credits abstract away the direct management of these parameters for the end-user.

Account Abstraction is an Ethereum standard (ERC-4337) that decouples transaction validation and execution logic from the core protocol, enabling smart contract wallets. This is a key enabling technology for gas credit models, as it allows for:

• Sponsored Transactions: A third party (like a dApp) can pay for a user's gas.
• Flexible Payment: Users can pay fees in ERC-20 tokens instead of native ETH.
• Batch Operations: Multiple actions can be bundled into a single gas-efficient transaction. Gas credit systems often leverage account abstraction to implement their sponsorship logic.

A Paymaster is a smart contract within the ERC-4337 account abstraction framework that can sponsor gas fees for user operations. It is the core technical component that executes a gas credit model. Its functions include:

• Validating Sponsorship: Checking if a user's transaction meets predefined rules (e.g., interacting with a specific dApp).
• Paying Fees: Depositing native currency to cover the gas costs of sponsored operations.
• Token Conversion: Optionally accepting payment in an ERC-20 token and converting it to native currency to pay the network.

A Transaction Relayer (or Bundler in ERC-4337) is a network participant that receives user operations, bundles them, and submits them to the blockchain. In gas credit flows, the relayer is often the entity that initially receives the gas-sponsored transaction and works with the paymaster. Key roles:

• Bundling: Aggregating multiple user operations into a single blockchain transaction for efficiency.
• Forwarding: Submitting the bundled transaction to the mempool or directly to a block builder.
• Fee Management: Ensuring the bundled transaction has sufficient gas to be included in a block.

The Fee Market is the economic mechanism that determines the priority and cost of transaction inclusion on a blockchain. Gas credit models operate within this market. Key dynamics include:

• Auction Dynamics: Users (or their sponsors) bid via gas price to have miners/validators include their transactions.
• Network Congestion: During high demand, gas prices rise, increasing the cost for credit sponsors.
• EIP-1559: Introduced a base fee that is burned and a priority fee (tip) for validators, creating a more predictable fee market that gas credit systems must account for.

Session Keys are a user-experience enhancement related to gas credits, allowing users to pre-approve a set of transactions for a limited time and scope without repeatedly signing. They work in tandem with gas sponsorship by:

• Granting Limited Authority: A user signs a meta-transaction that grants a dApp temporary permission to submit transactions on their behalf.
• Defining Parameters: Setting limits on gas spending, allowed contracts, and time windows for the session.
• Enabling Gasless UX: Combined with a paymaster, session keys allow for completely seamless, multi-step interactions where the user never signs for gas.