As crypto enthusiasts, we mostly care about making money and tend to ignore blockchain designs – mainly because most of us are not involved in the processing or development.
However, learning the technicalities of any industry is always beneficial, and you should understand the benefits and features of monolithic and modular blockchains.
Modular blockchains are the latest paradigm in blockchain design. And it can be used as an alternative or in conjunction with traditional monolithic blockchains.
You may be wondering what the differences are between these two types of blockchains and how these changes may affect how you use the blockchain.
Let’s Picture the monolithic blockchain in this instance. It’s like buying a car without knowing how to ride it.
But, there are new ways the manufacturer is trying to make them better, cheaper to use and upgraded to look cooler and easy to ride.
But you might not care about these upgrades right now, but it’s good to know about them in case they affect how much you spend on gas and how fast the car can go.
The Core Concept of the Blockchain
Execution
The execution layer is the environment in which applications run and change state. Process transactions, update blockchain state, execute smart contracts, and ensure blockchain integrity.
Settlement
The settlement layer is an optional hub for the execution layer to verify evidence, resolve disputes, and connect to other execution layers.
Its purpose is to ensure the validity of transactions and to handle disputes that may arise,particularly in situations where a high level of trust is needed, such as financial transactions.
Consensus
Consensus is the process of agreeing and ordering a transaction. In blockchain, consensus is achieved using consensus algorithms such as Proof of Work and Proof of Stake.
These algorithms are used to ensure that all participants in the network agree on the state of the blockchain and to prevent double spending and other forms of fraud.
Data availability
Data availability includes confirmation that all transactions are publicly available and available for download.
This ensures that all network participants have access to the same information, allowing the integrity of the blockchain to be independently verified.
This is achieved through the use of distributed ledger technology that facilitates data sharing and replication among all network participants.
The scalability trilemma in blockchain technology is primarily hindered by the data availability layer, which will be further examined later.
Monolithic Blockchain
A monolithic blockchain is a type of blockchain architecture in which all key features or responsibilities of the system are handled internally. This includes the base consensus layer, which is responsible for tasks such as data availability, settlement, and execution, often with the latter two being closely tied together.
These tasks are all carried out within a single, limited space. Bitcoin and Ethereum (without layer-2 solutions or rollups) are examples of monolithic blockchain architectures, as all necessary nodes for data availability, transaction execution, and consensus are contained within each block.
For mass adoption of blockchains to occur, they need to have the ability to handle a high volume of transactions while maintaining a decentralized network and strong security. This is a challenging task, known as the blockchain trilemma.
Several solutions have been proposed to address the blockchain trilemma, such as:
* Sharding
* Proof of Stake (PoS)
* Layer 2 solutions
* Modular blockchain
This article is focusing on Modular blockchain.
Modular Blockchain
Modular blockchains attempt to bring the best of both world by being scalable and decentralized. Modular blockchains split tasks into smaller units to increase efficiency by making the blockspace larger narrowing the validator set and focusing on shards.
This approach exponentially increases the output. of the blockchain by making the system more efficient.
The limitations of a monolithic blockchain are transformed into modular factors which increases its efficiency significantly. Hence, modular blockchains maintain decentralization and security, while also being scalable without any limitations.
Modular Blockchain Platform
There are many different modular blockchain platforms currently available, but we would be looking at two:
* Celestia blockchain
* Fuel blockchain
Celestia Blockchain
Celestia is a modular consensus and data network, designed to make it simple for anyone to deploy their blockchain with the least amount of resources.
Modular blockchains(Celestia), as opposed to monolithic ones, divide each task into four distinct layers: execution, settlement, consensus, and data accessibility.
The celestia blockchain consists of two key technical features:
* Data availability sampling (DAS)
* Namespaced Merle’s Trees(NMTs
Data availability sampling is a mechanism for verifying a block’s availability without needing to download all of it. Nodes apply data availability sampling by downloading random parts of a block to see if they’re available.
Namespaced Merkle Trees (NMTs) are a type of binary tree where each node is tagged by the namespace of its children.
The leaves are sorted by their namespace and by using Merkle proofs, it is possible to verify that all elements in a specific namespace are included.
Fuel Blockchain
Fuel is the most efficient execution layer for modular blockchain technology stack. It is powerful and sleeked, allowing for parallel transaction execution, providing developers with the maximum flexibility and security needed for scaling.
How Does It Work?
* Parallel transaction execution
* Fuel Virtual Machine (FuelVM)
* Sway language
Fuel’s UTXO (Unspent Transaction Output)
Fuel’s UTXO model allows for parallel execution of transactions by using strict state access lists, resulting in increased processing capacity and faster transactional throughput compared to traditional single-threaded blockchains.
Unlike the EVM, the FuelVM utilizes state access lists to map out dependencies and execute transactions in parallel, making it more efficient.
Fuel Virtual Machine
FuelVM is a specialized virtual machine built for creating and running smart contracts on the Fuel network, It is similar to the Etheruem virtual machine and uses Fuel’s own programming language, Sway, to execute contracts.
It is optimized for high performance by running transactions in parallel and minimizing unnecessary processing.
In addition, it contains advanced features and ideas from the EVM community that previously could not be implemented due to compatibility issues.
Sway Language
Sway is a language that is specifically developed for writing smart contracts on Fuel chain and FuelVM. It is influenced by Rust, a popular programming language used in the Solana ecosystem.
However, it also incorporates features common in smart contract languages such as Solidity, Sway has a syntax similar to Rust, and it emphasizes safety and security by performing analysis during compile-time and built-in static auditing.
It also has built-in storage and blockchain functionality for convenient and secure contract programming.
Furthermore, Sway is highly efficient and has a modular structure that can adapt to different blockchain architectures.
Final Thoughts
Blockchains are evolving from a single-component design where consensus, data availability and execution are closely linked, to a modular design where execution is separated from data availability and consensus.
This separation enables specialization at the base layer, resulting in a significant boost in bandwidth capacity