💳Why Token Bound Accounts

What is ERC-6551?

ERC-6551 is an Ethereum Improvement Proposal that revolutionises NFTs by enabling them to function as self-contained wallets - ie. Token Bound Accounts (TBAs).

This innovation allows NFTs to hold other digital assets, such as Ethereum-based tokens and derivative NFTs like digital wearables.

The goal is to streamline and enhance digital ownership across EVM Web3. By assigning wallet functionalities to NFTs, users can now facilitate direct asset transactions through the NFTs themselves.

This also means that transferring or selling an ARCA means selling its wallet's portfolio too. We are putting safety features in place to prevent accidental loss of funds

How Arcadefi Uses ERC-6551

Our experiences working in DeFi and on-chain gaming have made us aware of the following issues :

• Poor user experience, especially when traversing different chains

• Misaligned mechanisms putting loyal users at a disadvantage (airdrop farming)

• Whales extracting value from less wealthy users

We use Token Bound Accounts to fix these issues by :

Enabling Seamless Transaction Batching

Utilising EIP-1271 alongside ERC-6551, we can turn tedious processes, such as approving tokens, swapping them, approving the new token and depositing, into a single transaction.

Limiting Wallet Holdings

Using smart account logic, we can set a cap in the value that individual ARCAs can hold and take from. This pressures whales into buying additional ARCAs to benefit from the yield multiplier pipeline - leading to value being added back into the wider community.

Bot Mitigation

Both of the above features allow us to minimise the capabilities of bots vs loyal users - giving ordinary apes a more even playing field in a world filed with on-chain cyborgs.

Other Cool Things We're Planning to do Using TBAs

• Paying users' gas fees

• Alternate signers for different transaction types e.g.

  • Deposit, swap between vaults and play mini-games using your phone wallet

  • However, withdrawals need your Ledger's signature

• Enabling users to auction their entire portfolios