Why Programmable Wallets Are Essential Infrastructure for the Future of Decentralized Finance

As AI agents begin to manage liquidity, optimize yield, and execute trades at all hours, they're quickly becoming essential infrastructure

In a domain where crypto markets operate around the clock but human traders have their limitations, emerging AI agents are stepping in to manage liquidity, optimize yield and execute trades at all hours.

As these agents begin to play a more integral role in decentralized finance (DeFi) by handling tasks that humans used to do, they’re quickly becoming essential infrastructure for the future of the industry.

While AI agents are evolving from niche tools for quant traders into mainstream financial operators, they’re rapidly outpacing the wallets meant to secure them.

Sure, advancements in account abstraction and smart contract wallets have emerged, but most DeFi platforms still predominately rely on externally owned account wallets that require manual approvals at every step. Early-stage programmable solutions exist but remain fragmented, costly on layer-1 networks and adopted by only a tiny fraction of users.

But as AI agents become more capable and begin performing complex financial functions, this infrastructure limitation becomes critical.

We need standardized infrastructure that allows for secure, cost-effective automation with verifiable guardrails across multiple blockchain ecosystems.

This is especially urgent as institutions are increasingly entering the space. Most institutional investors won’t allow AI agents to interact with capital without verifiable guardrails and reporting mechanisms.

The rise of autonomous agents opens new possibilities: hands-free DeFi strategies, real-time portfolio optimization and crosschain arbitrage. But without programmable permissions and onchain visibility, delegating control to AI can expose users to catastrophic risk.

Malicious bots, hallucinating agents and poorly designed automation can drain wallets before a human notices. We’ve already seen what happens when agent infrastructure fails.

In September 2024, users of the Telegram-based trading bot Banana Gun lost 563 Ether (ETH) (approximately $1.9 million) through an exploited oracle vulnerability that allowed attackers to intercept messages and gain unauthorized access to user wallets. More recently, attackers breached Aixbt’s dashboard and issued commands to transfer funds directly, resulting in the loss of 55.5 ETH worth over $100,000.

These aren’t isolated incidents — they are warning signs of systemic vulnerability in our automation infrastructure.

Despite years of wallet innovation, the architecture remains static mainly: sign a transaction, broadcast it, repeat. Most wallets aren’t built to understand “intent,” verify that automation matches user-defined rules, or restrict activity by time, asset type or strategy.

This rigidity creates an all-or-nothing dynamic: either you maintain manual control and miss out on fast-moving opportunities or you hand over access entirely to opaque third-party systems. For AI-powered DeFi to scale securely as it builds more utility, we need programmable, composable and verifiable infrastructure.

As smart contracts encode logic into DeFi protocols, wallet infrastructure must encode logic into user control. That means enabling session-based permissions, cryptographic verification of agent actions and the ability to revoke access in real-time.

With these features in place, users can delegate trading, rebalancing or strategy execution without giving up complete control. This approach doesn’t just mitigate risk — it expands access. Advanced DeFi strategies could become accessible to users without technical knowledge and managed securely by agents operating within verifiable constraints.

Programmable wallet infrastructure doesn’t just make DeFi safer — it makes it scalable. Fragmentation across chains and protocols has long been a barrier to automated strategies. A universal keystore protocol that syncs permissions and enforces constraints across networks can streamline crosschain delegation and open the door for interoperable agent ecosystems.

Moreover, as institutional interest in DeFi grows, this type of secure automation will be non-negotiable. Most firms won’t allow AI agents to interact with capital without verifiable guardrails and reporting capabilities.

Just as zero-knowledge proofs are becoming essential to privacy and compliance, programmable wallet permissions may become standard for agent-based security.

Some may argue that AI can’t be trusted with financial autonomy, but traditional markets have already adopted algorithmic trading and black box automation. DeFi isn’t immune — it’s simply unprepared.

If crypto is to maintain its transparency and user sovereignty principles, it must build infrastructure that keeps AI agents in check. That starts with rebuilding wallets as interfaces and operating systems for the autonomous, multichain economy.

DeFi is on the edge of an automation revolution. The question isn’t whether agents will participate. Whether we give them the rails, they need to act in service of users, not in spite of them.