Ledger & Pectra: Securely Entering a New Era for Ethereum

Before You Dive In:

—  Ethereum’s Pectra upgrade introduces EIP-7702, allowing Externally Owned Accounts (EOAs) to temporarily function as smart contract accounts for transaction batching, gas sponsorship, and delegated actions.

—  Ledger is implementing EIP-7702 support with a security-first approach, initially limiting interactions to whitelisted smart contracts vetted by the Ethereum Foundation.

— Users wanting to explore EIP-7702 capabilities will need the latest Ethereum application on their Ledger device.

Pectra is an important milestone for Ethereum, driving scalability and advancing account abstraction. This upgrade introduces several enhancements, including increased blob throughput, adjustments to validator staking, and EIP-7702. This latter proposal allows Externally Owned Accounts (EOAs) to temporarily function as smart contract accounts, unlocking potential for features like transaction batching, gas sponsorship, and delegated actions.

While EIP-4337 has garnered significant attention in the account abstraction space, EIP-7702 offers a more immediate path for users to experience some of the benefits without fully transitioning away from their familiar EOA capabilities. Ledger is committed to supporting these advancements from day one, enabling users to engage with EIP-7702 through a clear approval process and dedicated Transaction Type 4, initially focused on a curated list of secure contracts. Here’s how Ledger will securely support this new era for Ethereum.

Our Secure Approach to EIP-7702

EIP-7702 enables temporary smart contract functionality on existing accounts, bringing immediate benefits like bundled transactions and alternative gas payments. We’re excited about the possibilities EIP-7702 unlocks, but security is our top priority. For the initial rollout of Pectra support on Ledger devices, we’re taking a cautious and secure approach. This approach prioritizes the security of user funds by limiting initial interactions to well-vetted smart contracts. We will continuously evaluate the need for updates to this whitelist as the EIP-7702 ecosystem evolves.

• Device-Level Support for EIP-7702: Your Ledger device will be compatible with EIP-7702, enabling the transformation of your Externally Owned Account (EOA) into a smart wallet.
• Whitelisted Smart Contracts: To mitigate potential risks associated with unaudited smart contracts, we will initially only support interactions with a carefully curated whitelist of trusted smart contracts, provided by the Ethereum Foundation. This means that in the first iteration, authorizations to smart contracts not on this whitelist will be blocked at the device level.
• Clear Signing for Whitelisted Interactions: Transactions involving whitelisted smart contracts utilizing EIP-7702 will benefit from Clear Signing on your Ledger device, ensuring you maintain full transparency over what you are authorizing.
• No Immediate Smart Wallet Features in Ledger Live: While your device will support EIP-7702 at a fundamental level, we will not be offering full smart wallet capabilities directly within Ledger Live at this time. This allows us to thoroughly evaluate the security landscape and user experience before integrating more complex features.
• See our Academy article on the Ethereum Pectra Update for more information

Important Note for Ledger Users

The Pectra upgrade will not impact your regular Ethereum transactions and transfers. These will continue to function seamlessly, just as they do today. You only need to be aware of the following if you intend to explore the new smart contract delegation capabilities offered by EIP-7702.

For those who may explore the new possibilities offered by EIP-7702, Ledger is implementing support with a strong emphasis on security. To utilize smart contract delegation via EIP-7702 on your Ledger device, you will need to ensure you are using the latest version of the Ethereum application (reference this Help Center article)

Furthermore, in this initial phase, this functionality will only be available for whitelisted and securely audited smart contracts, following guidelines from the Ethereum Foundation.

For Ledger Nano S users, please be aware that as we are phasing out support, you will be unable to update to version 1.17 of the ETH application, and therefore won’t be able to benefit from EIP-7702, but can still send ETH transactions and transfers using the existing version of the ETH application.

Released in 2016, the Ledger Nano S™ was a pioneering device in its time. However, due to its limited memory and technical capacity, it faces constraints when supporting newer, more advanced features. As the operating system and applications have evolved, the device’s ability to accommodate additional functionalities has naturally become more limited.

Looking Ahead

We believe EIP-7702 is a crucial step towards account abstraction on Ethereum, and we’re actively exploring its potential. We will be closely monitoring the adoption of whitelisted contracts and the community’s needs for more dynamic updates in the future.

Our commitment remains to provide you with the most secure way to interact with the evolving Web3 ecosystem. The Pectra upgrade and our measured implementation of EIP-7702 reflect this commitment. We’re eager to see the innovative use cases that will emerge and will continue to prioritize the security of your Ledger devices every step of the way.

Stay tuned for more updates as the Pectra upgrade progresses!

Authored by Charles Guillemet, Chief Technology Officer