Visa Deploys ‘Paymaster’ Contracts on Ethereum Testnest for Gasless Transactions

Global payments giant Visa has deployed experimental smart contracts on Ethereum’s Goerli testnet for gasless transactions via account abstraction.

two sets of smart contracts, dubbed cashierEthereum will simplify user interactions with the network by performing complex tasks on behalf of other accounts and managing transaction costs.

Visa Tests Paymaster for Frictionless Transactions

Account abstraction is a proposal to allow control of an account to be controlled by a smart contract by separating it from its associated private key in order to increase flexibility in managing and dealing with Ethereum accounts. The mechanism is enabled by ERC-4337, a new Ethereum standard launched in March.

Visa wants to To leverage the ERC-4337 standard to implement an intermediary currency conversion service. The first version of the Paymaster contract explores whether users can pay transaction fees with alternative tokens such as dollar-pegged stablecoins or central bank digital currencies (CBDCs).

The contract can collect any ERC-20 tokens from users and convert them into Ether (ETH) based on the current exchange rate to pay gas fees on behalf of users, thus only ETH for transaction fees may eliminate the need to obtain

“This sample contract includes the governing logic for both Paymaster and its custom ERC-20 token. For this contract, we introduced an allow list and a function to update the token-to-ETH conversion rate. This allowed us to allowed to better simulate real-life situations where the exchange rate between ETH and a token is dynamic,” Visa said in a report.

Enable Gasless Transactions

The payments giant believes the Paymaster concept could encourage adoption by allowing users to fund gas costs only at the time of transactions without any pre-funding requirements to optimize their cash-flow management .

The second Paymaster contract seeks to eliminate the need for users to cover gas fees themselves, similar to Web2 peer-to-peer (P2P) transactions, by using a solution provided by account abstraction, which enables fintech wallets. such as allows third parties. providers, to handle the costs.

In this case, third parties may act as payers, sponsoring transaction fees entirely for users. The experiments are based on starter code provided by the Ethereum Foundation and the ERC-4337 core team.

We tested two main user operations: 1) paying with ERC-20 tokens using ERC-4337 Paymaster; 2) Sponsoring transaction fees for users (aka gasless txs) with ERC-4337 Paymaster

— Catherine Gu (@catgu_) May 17, 2023