Smart Accounts are a new type of ledger account introduced by Radix that provides advanced features for authentication, authorization, and recoverability.
- Overview
- Features
- Eliminate Seed Phrases
- Configurable Deposit Settings
- Miscellaneous
- Implementation
- Comparison with Ethereum
Overview
On the Radix network, accounts are implemented as a built-in component that serves as an "intelligent storage and management" system for assets. This component-based architecture allows Smart Accounts to utilize native Radix features like configurable authentication rules and badge-based authorization. According to Russell Harvey, CTO of RDX Works, Smart Accounts are "very specialized" components that function similarly to smart contracts.
A key advantage of Smart Accounts is the ability to eliminate reliance on a single seed phrase for account recovery. Instead, Radix leverages a system based on "roles" and multi-factor authentication to facilitate recovery and access control. Smart Accounts also allow users to configure rules around receiving token deposits from third parties.
Smart Accounts aim to provide the recovery flexibility of traditional applications with the self-sovereignty of decentralization. This unique design is intended to improve user experience and enable additional account features down the road, such as subscriptions and direct debits.
Features
Eliminate Seed Phrases
A major innovation of Radix Smart Accounts is the ability to eliminate reliance on a single seed phrase for account control and recovery. Instead, Smart Accounts utilize Radix's native badge-based authentication system.
Badges are assets on the Radix ledger that can be used for access control and authorization. The holder of a badge can generate a temporary proof of ownership that Smart Account logic can verify to permit actions. According to the Radix blog:
"Because Smart Accounts can specify the "keys" (badge proofs) to its "locks" (authentication rules), the ability to withdraw assets from an account...doesn't have to be bound forever to a single private key or seed phrase."
This allows Smart Accounts to natively support multi-factor authentication using combinations of things like mobile phones, hardware wallets, and personal questions. It also enables social recovery by granting badge tokens to trusted contacts.
"you can still set it up so that your primary role generally is your phone...but the recovery and these other two roles allow the smart account to kind of manage that for you." - Russell Harvey, ‘Smart Accounts: No more seed phrases’.
Configurable Deposit Settings
Another unique capability of Radix Smart Accounts is the ability to configure rules around receiving token deposits from third parties: "You have a variety of options for setting the third-party deposit rules on each of your accounts."
Specific deposit settings exposed through the Radix Wallet include:
- Default rules to accept all deposits, no deposits, or only previously held assets
- Allow lists and deny lists for specific tokens
- Whitelisting badge holders to deposit freely
"One feature is locking...This is an added piece of Access Controller functionality to help address the problem of 'my phone got stolen and I can't immediately migrate to a new one'." - Russell Harvey, ‘Smart Accounts: No more seed phrases’.
The Access Controller role system allows accounts to be put into a restricted safe mode until security settings can be updated.
Additionally, Radix Smart Accounts enable fee payment delegation, allowing the user to choose which account pays fees on a per-transaction basis. Accounts can also easily produce on-ledger proofs of any assets they hold.
Miscellaneous
In addition to the configurable authentication, authorization, and deposit rule capabilities covered already, Radix Smart Accounts have several other utility features:
- Account locking: A security mode that restricts token withdrawals, enabled via the Access Controller recovery role. This safeguards funds if a factor like a phone is lost or stolen while migrating to a new one.
- Fee payment delegation: Smart Account owners can choose on a per-transaction basis which account will pay the network fees. This is not possible on networks without native fee payment abstractions.
- Proof production: Assets held in a Smart Account can have their ownership easily proven on-ledger. This allows frictionless integration with dApps that leverage Radix's decentralized identity system.
The component model and native network features provide flexibility for additional account features in future protocol updates.
Implementation
Radix Smart Accounts are made possible due to the unique architecture of the Radix network. Smart Accounts are "a very specialized [component] that definitely is a smart contract."
Several native platform capabilities enable the functionality of Smart Accounts:
- Asset-oriented transactions: Transactions specify how assets flow between accounts and components, allowing intuitive withdrawal/deposit rules.
- Configurable authentication rules: Radix has a native auth system for components to define access control requirements based on badge proofs rather than a single key.
- Component model: Components are Radix's version of smart contracts that can hold real on-ledger assets, unlike accounts on other networks.
"Because assets are so fundamental to the Radix platform, the accounts that hold them have to be just as fundamental." - Russell Harvey, ‘Smart Accounts: No more seed phrases’.
Comparison with Ethereum
A key differentiation between Radix Smart Accounts and previous account systems is the avoidance of complexity from tacked-on abstractions. Ethereum's proposal for "account abstraction" exemplifies the challenge of bolting advanced features onto an existing protocol not designed for them.
Ethereum’s ERC-4337 specification aims to "enable the possibility of decentralized multi-factor account control and recovery – no magical single seed phrase required.” However, due to the requirement of not disrupting Ethereum's core transaction logic, account abstraction involves:
- A separate user operation pool and bundle marketplace
- Special "bundler" node infrastructure
- Additional reputation scoring mechanisms
- Custom factory and entry point smart contracts
This introduces significant complexity to achieve account flexibility, risking fragility, inefficiency, and compatibility issues.
In contrast, the Radix network was built from the ground up with native building blocks for asset manipulation and configurable access control. Transactions specify asset flows between components, with authorization rules set in a component's logic. Rather than a complex add-on, Smart Accounts are simply instances of Radix's component model with additional logic, fitting seamlessly into the standard transaction flow.
This fundamental architectural divergence highlights the limitations of attempting to stretch existing protocols versus engineering purpose-built designs optimized for usability. The intuitive simplicity of Radix Smart Accounts provides a more sustainable path toward mainstream adoption by eliminating user experience barriers.