Original title: "Modular Blockchain Ecosystem Overview"

By Kadeem Clarke

Compiled by: TechFlow

 

Blockchain has been evolving, with each iteration trying to solve the blockchain trilemma of decentralization, scalability, and security. Blockchains such as Bitcoin, Ethereum, and Solana have a monolithic structure and four main functions: data availability, consensus, settlement, and execution.

As these functions compete for the same resources, monolithic blockchains will inevitably encounter the following scalability issues.

Modular blockchain solutions like Celestia, Dymension, and Fuel give developers a wide range of options for not only scaling blockchains but also enabling cross-chain interoperability.

The concept of building modular blockchains is still very new, so it will be interesting to see which existing chains start taking a similar approach now.

Modular blockchains have improved efficiency because they concentrate validators on shards, which increases the throughput of the blockchain.

Here are some advantages of modular blockchain:

  • Sovereignty

  • Scalability

  • Easy to build projects

 

Celestia

 

Celestia is focused on blockchain scaling and has raised $55 million to fund its expansion plans. Celestia is creating a unique modular blockchain architecture to solve scaling and deployment issues.

The Celestia team intends to make blockchain deployment simple for everyone. Therefore, Celestia's modular blockchain architecture prioritizes the following aspects:

  • Improve scalability

  • Shared security

  • Sovereignty issues

Developers can choose their own execution environment, such as Solana VM and EVM. Celestia also offers a scholarship for modular builders. They listed three blockchain projects as users of their data availability layer in their recent funding announcement:

  • Eclipse

  • Constellation

  • Dymension

The project is also providing $3,000 per month for three months to 26 members of its “Modular Fellows Cohort.” Scott Sunarto, who previously worked at the Ethereum Foundation and Uniswap Labs, is one of the recipients.

Celestia is still in the early stages of development. The development team released an MVP notification in 2021 and launched the development network in November 2021. 2022 is more important as the project has launched a test network and is gradually building a main network.

 

Dymension

 

As part of the Cosmos ecosystem, this modular settlement layer provides the ability to launch Enshined Rollups (Rollup logic baked into the protocol), which opens up decentralized use cases.

Dymension is a sovereign Rollup built on Cosmos that aims to make the development of RollApps (RollApps focused on custom applications) easy through the Dymension Chain (settlement layer), RDK (RollApp Development Kit), and IRC (Inter-Rollup Communication).

Dymension is optimized for maintaining Rollup state, verification, and fraud proofs, while only accepting Rollup transactions and basic transfers.

On Dymension, developers can focus on business logic requirements and quickly deploy application-specific Rollups using the RDK and a specialized settlement layer, while benefiting from IRC, shared security, and data availability.

Dymension RollApps, like Cosmos, aims to create application-specific blockchains to reduce consensus overhead. Based on Cosmos-SDK, RDK adds new modules and modifies existing modules to ensure that RollApp is compatible with the Dymension protocol and other Cosmos ecosystem tools. RollApps can communicate with any chain that supports IBC through the Dymension Hub.

 

Fuel Labs 

 

Fuel Labs is building a fast execution layer for a modular blockchain stack. Fuel has seen significant growth as the project has brought together some of the best engineers in the space.

Fuel's technology is built on three pillars:

  • Parallel Transaction Execution: Fuel provides top-level processing power by executing transactions in parallel

  • Fuel Virtual Machine (FuelVM): FuelVM increases the design space for developers

  • Excellent developer experience (with Sway and Froc): Fuel's domain-specific language, Sway, provides a unique and streamlined developer experience. Fuel also has a supporting toolchain called Forc.

Fuel aims to be an autonomous drive. Developers can build without using middlemen. It offers modularity and an alternative to Ethereum’s future. Ethereum is moving towards a Rollup-centric direction. Fuel claims it can extend the execution layer beyond the standard Rollup. The team claims they will do so without compromising security and at a low cost.

Because Fuel is designed for fraud proofs, full node resource requirements may be higher than usual, increasing bandwidth capacity while allowing users to validate the chain through trust-minimized light clients.

 

Benefits of modular blockchain

Scalability

Monolithic blockchains allow users to place all the expected blockchain functions in a single layer known as Layer 1. This makes the creation of blockchains difficult as it attempts to handle all functions simultaneously within a single layer. Modular blockchains share different functions between different layers, improving scalability and preventing network outages.

Simplifying blockchain creation

In order to start a new blockchain, miners must deal with security and decentralization issues, which may prevent some from optimizing hashrate outside the network (opportunity). When miners are less focused on specific functions (such as consensus), they can exploit the layout and create new blockchains faster, regardless of the blockchain architecture.

flexibility

The layout of a modular blockchain is much more flexible than that of a monolithic blockchain. Its purpose is to provide miners with features that are not available on a monolithic blockchain.

 

Summarize

With the development of Layer 2 and Rollups, the Ethereum ecosystem has shifted towards a modular architecture.

One of the biggest obstacles to the large-scale adoption of blockchain technology is scalability.

Layer 1 scaling solutions focus on block production rather than block validation. Modular blockchain infrastructure aims to promote Web 3 adoption with scalability, security, and decentralization, and focuses on ease of integration, fast delivery, and user experience.