A new type of crypto wallet is gaining attention for its ability to let users keep full control of their funds while still allowing automated agents — including AI — to make transactions. Called delegated wallets, the model separates the power to authorize transfers from the infrastructure that executes them. The user holds the signing credential, typically a passkey, while the provider hosts the backend but cannot move funds on its own.
How delegated wallets differ from custodial models
In a delegated wallet, the user's credential is required for any value transfer. That ensures the user retains control even though the provider runs the infrastructure. The backend often uses multi-party computation (MPC) or threshold signatures, with the user's device-bound credential authorizing on-chain transfers. This is a non-custodial setup — the provider never has sole access to the funds.
Delegate keys, such as those used in Safe, are stored off-chain. They cannot execute on-chain transactions without owner approvals, but they can propose actions. That distinction is critical for automated spending: an AI agent can prepare a transaction, but the user must still authorize it.
Key components: smart wallets, off-chain permits, relayers
The delegated wallet model relies on several building blocks. Smart wallets, defined by EIP-4337, allow programmable account logic. Off-chain permits, specified in EIP-2612, let users sign approvals without sending an on-chain transaction. Relayers and paymasters, like those in the OpenGSN network, handle gas fees and submission so the user doesn't need ETH for every action.
Together, these components create a system where the user sets the rules and the infrastructure executes within those rules. The user's passkey remains the ultimate authority.
The AI agent spending flow
One concrete use case is letting an AI agent spend within predefined limits. The flow works like this: first, the user initializes a wallet and sets policies — for example, a daily spending cap or a whitelist of addresses. The agent then prepares an action, such as a token transfer. That action is submitted via a relayer, which forwards it to the user's device for final authorization. The user approves with their passkey, and the transaction goes through. If the user wants to stop the agent, they can revoke its permissions at any time.
This flow keeps the agent on a short leash. The agent never holds the keys; it only proposes actions that the user must sign off on.
Automated spending has always been a security headache. Custodial solutions require trusting a third party with your keys. Smart contracts with hardcoded limits can be exploited if a bug is found. Delegated wallets offer a middle ground: the user stays in control, but the automation can still happen. The model is already being implemented in projects like Safe and OpenGSN, which provide the infrastructure for delegate keys and relayers.
As more developers build on these standards, delegated wallets could become a common way to manage automated crypto spending — especially as AI agents start handling more financial tasks. The next step is wider adoption of EIP-4337 and EIP-2612 across wallets and dApps, making the user experience seamless without sacrificing control.
