Close view of electronic circuitry representing ERC-4337 smart accounts and paymaster security

Smart accounts can make AI-powered blockchain apps easier to use: an app may sponsor the gas fee so a new user does not need ETH before a first action. With autonomous agents, that convenience introduces a new question: who pays when software initiates too many operations, retries errors or reaches beyond a user’s intended authority?

This analysis uses the original ERC-4337 specification, paymaster security documentation and Ethereum’s account abstraction overview to propose a gas-sponsorship control framework for AI agents.

Begin with the actual ERC-4337 execution path

In ERC-4337, users submit UserOperation objects rather than ordinary transactions through the familiar externally owned account path. Bundlers validate and package operations for the EntryPoint contract, and a paymaster can agree to cover gas instead of the sender. The Ethereum Improvement Proposal describes the key parties and fields, including paymaster data, gas limits and signatures. This creates a smoother experience for users who have no ETH balance, but it does not make transactions free. The sponsor simply moves the cost to a different budget holder. An AI agent that performs wallet actions can generate more requests than a human browsing a dapp, particularly if it retries failed tasks. Before subsidizing anything, map the complete operation path and confirm who authorizes the smart account, who can ask the paymaster to sponsor an operation, and how on-chain finality is checked. Gas abstraction should not become permission abstraction.

Design spending authority separately from fee sponsorship

A user may permit an AI assistant to research a token or prepare a purchase without authorizing it to transmit a signed on-chain operation. The account’s validation logic and the product’s approval flow must preserve that distinction. A paymaster’s willingness to cover fees only answers the question of who pays gas; it must never be treated as evidence that the account owner consented to the action. Scope agents by allowed contracts, methods, token amounts, chains and time windows where the smart account supports such controls. Require fresh confirmation for higher-risk transfers, approvals or changes to authority. Ethereum.org’s account abstraction overview explains that smart contract wallets enable programmable security rules, recovery and gas sponsorship. It is the developer’s responsibility to design those rules correctly. Keep signatures bound to their intended chain and account execution context, and test rejection paths as carefully as successful purchases.

Set a sponsorship budget before exposing an endpoint

A production paymaster needs an internal policy engine with at least a daily sponsor budget, per-user ceilings, per-operation limits and emergency pause controls. The ceilings should apply to attempted usage, not just successful business outcomes, because reverted or abandoned operations may still create costs. Differentiate onboarding sponsorship from repeated activity by established accounts. If growth experiments promise a certain amount of subsidized gas, cap the commitment in code and disclose the actual terms in the user interface. Rate-limit identical or near-identical operations and associate them with a stable account identity where appropriate, while minimizing unnecessary collection of personal data. Do not advertise “unlimited free transactions” when the sponsor’s economic exposure is finite. The paymaster design can be funded by a marketing budget, transaction revenue or another lawful business model, but the ledger should identify those costs rather than burying them in blockchain infrastructure spend.

Protect against simulation, griefing and replay edge cases

The ERC-4337 specification explains that bundlers simulate validation and that paymaster participation introduces additional validation requirements. Its paymaster extension also recognizes denial-of-service risks from maliciously crafted operations. The ERC-4337 documentation discusses griefing and the possibility of attackers attempting to drain deposits through abusive activity. The engineering response is defense in depth: deterministic validation where required, strict gas estimates, appropriate deposit management, simulated bundles, request throttling and monitoring of repeated failures. A backend allowlist is not sufficient if signed authorizations can be replayed in a different context or if the smart account executes a broader set of methods than intended. Review exact EntryPoint versions, contract storage effects and chain-specific behavior during implementation. Commission independent smart-contract audits for meaningful economic exposure; no blog checklist can certify a paymaster contract safe.

Separate agent planning from the final on-chain action

An AI agent should generate an explainable plan before submitting a transaction: destination, token, maximum value, estimated gas, associated smart account and the user authority that would permit it. The product can simulate the proposed UserOperation and display the result, but must distinguish a simulation from a confirmed on-chain execution. After submission, record the UserOperation hash and the final transaction receipt before claiming completion. Tool failures should not trigger blind re-signing or repeat submission; reconcile status first. If a gas sponsor rejects an operation, provide the user with a clear alternative rather than silently routing through a different account or shifting fees without notice. A confirmation step can be lightweight for pre-authorized, low-risk actions, yet high-value and authority-changing requests should have stricter gates. This keeps the system useful without letting natural-language ambiguity act as a financial authorization mechanism.

Publish a sponsor-risk dashboard and test plan

Track gas sponsored per active user, rejection reasons, successful business events, operations that reverted, deposit utilization and anomalous activity by chain and contract method. Monitor both attempted and settled operations; a low average gas cost can hide a small number of expensive failures. Establish a release gate using synthetic accounts that test replay attempts, mismatched chains, expired authorization windows, sudden traffic bursts and sponsor exhaustion. The pass condition is not merely a technically valid operation. It is that the account remains within the user’s intended authority, the sponsor remains within its cost limits and the application accurately reports the result. ERC-4337 gives the architecture for sponsored smart-account operations; creating safe AI-agent economics still requires policies, monitoring and business controls above the protocol. The defensible product position is convenient transactions under explicit limits, not unrestricted autonomous spending.

Sources

Security controls discussed here are design recommendations; specific smart contracts require implementation reviews and independent audits.