Vitalik cautions about ‘Relay’ issue in Ethereum’s Smart Wallets before major upgrade
May 25, 2026
Ethereum co-founder Vitalik Buterin has recently raised concerns about a significant vulnerability in the network’s transaction infrastructure, specifically targeting smart contract wallets and privacy protocols. He emphasizes that these components currently rely on third-party intermediaries to ensure their transactions are included on the chain, creating a potential point of failure.
Smart contract wallets, which are essentially crypto accounts controlled by programmable code rather than traditional private keys, are gaining popularity due to their enhanced security features like multi-signature capabilities, social recovery options, and gas sponsorship. However, their dependency on external relays for transaction processing leaves them susceptible to disruption if a relay goes offline or refuses to process a specific transaction.
This reliance on external relay services also affects privacy protocols, which aim to conceal transaction details from the public eye. Buterin views this as a vulnerability that contradicts Ethereum’s fundamental principle of censorship resistance, a core focus for the Ethereum Foundation moving forward.
In response to this issue, Buterin proposes a solution involving two Ethereum Improvement Proposals (EIPs) and a new inclusion mechanism known as Fork-choice Enforced Inclusion List (FOCIL). These initiatives are part of the upcoming Hegota upgrade, expected to launch in late 2026. FOCIL introduces a system where validators are randomly selected to include transactions in each block, reducing the likelihood of censorship by preventing any single entity from controlling transaction inclusion.
Additionally, EIP-7701 aims to implement native account abstraction for Ethereum wallets, granting them the programmability currently exclusive to smart contract accounts. EIP-8141 extends this concept further by enabling features like quantum-resistant signatures, key rotation, and gas sponsorship at the base protocol level.
The combined implementation of FOCIL and EIP-8141 would allow smart contract wallets to directly submit transactions to the public memory pool without the need for intermediary relays, ensuring a more robust and decentralized transaction processing system. Looking ahead, Buterin reiterates that privacy and censorship resistance will be key priorities for the Ethereum Foundation as they prepare for the Hegota upgrade, a significant milestone in Ethereum’s evolution since transitioning to a proof-of-stake framework in 2022.
