Introducing Modular Blockchains: A New Era Beyond Layer 2 Scalability
Blockchain technology continues to develop, but scalability has always been its biggest issue. As a developer designing the next DeFi platform, or perhaps you’re just a user sending a transaction, you’ve probably experienced delayed confirmations and excessive gas fees.
Bitcoin and Ethereum were monolithic blockchains, which means they executed consensus and data all in the same place. Layer 2 solutions are now here to provide faster and cheaper transactions by outsourcing the work. Even those solutions have their limitations.
Now we have new innovations in cryptocurrency, such as modular blockchains, that change the way we think about how we scale blockchains, how they change and interact, not just how we upgrade blockchains.
The Scalability Problem
Imagine trading tokens or making an NFT when gas fees hit $50 or above. Ridiculous right? Congestion on monolithic chains is a reality: users compete for block space, ratcheting up the price.
It's not even about the cost. The slowness of transactions is irritating. The delay is disastrous for a developer trying to create a real-time product like games or decentralized exchanges.
Users are constantly switching between blockchains and wallets. The fragmented experience of bridging assets, switching RPCs and user interfaces terrifies new users.
All of these challenges reduce the usability of blockchain, delaying adoption.
Layer 2 Tried to Fix It
Layer 2s have come up with a great solution to this problem. Most transactions are processed off-chain, with only the final outcomes submitted to the foundation layer, which tends to be faster and cheaper. They usually inherit base chain security so users are not losing trust. That said, they still have to rely on that base chain and cannot escape congestion.
Layer 2s are not easy to jump between. It means using asset bridges, managing wallets, and learning yet another interface. It is progress, but not the complete seamlessness consumers expect from modern technology.
What are Modular Blockchains?
Consider modular blockchains as taking apart a complex machine into its components that are each specializing in one task. Conventional blockchains do execution, consensus, and storage all at once, and as a result, this is a monolithic design.
In the case of modular blockchain some of these duties are separated:
- One layer executes smart contracts and transactions.
- A different layer achieves consensus on the validity of the processes.
- And yet another layer stores and verifies data.
The benefit of separating these pieces is more efficient processing on each layer. It is similar to building a computer, piecing it together over time, upgrading your CPU today, and putting a new graphics card in next week.
English Explanation of Modular Blockchains
What makes modularity so beautiful? Flexibility.
Modular design is the capability to plug in components specific to your project. You can have a developer leverage Celestia for data availability, another layer for consensus, and design a custom execution chain.
No big deal, just upgrade that layer that becomes the bottleneck. Everything else is unchanged.
That's incredibly powerful for modular blockchains. Web3 Lego blocks allow you to mix, match, and build what you need.
Why Modular Outperforms Layer 2
Modular blockchains do even more than Layer-2's greater scalability: developers can now scale parts of the architecture, rather than being bound to one scaling method.
If the execution layer gets busy, it can see improvements without touching the consensus or data layers, something neither traditional nor Layer-2 systems can do.
User experience is another huge benefit for modular blockchains. Because the modular layers work with each other, users won't have to switch to other wallets or networks, and everything just works.
To recap, modular blockchains are faster, more scalable, more flexible, and more user-friendly, which is a huge need for blockchain adoption to continue.
A Quick Layer Breakdown
To recapitulate:
- Execution Layer: This layer is responsible for smart contracts and transactions.
- Consensus Layer: Keeps everyone on the same page.
- Data Availability Layer: This stores and provides access to blockchain data.
The bottom line is that each could be modified, or swapped out individually.
Celestia, Modular Pioneer
Celestia is one of the first modular blockchains.
Celestia is focused on data availability and consensus first and foremost and leaves execution to other projects. Developers can build custom blockchains or rollups based on Celestia and do not have to build from scratch.
This is the same idea that Manta Network and Dimension are utilizing to create faster, cheaper, and specialized blockchain environments. The best part is that they can upgrade without congesting the main chain.
It Works in Practice
Manta Network took advantage of Celestia's modular architecture to create a privacy-centric experience and Dymension is enabling "RollApps," custom rollups that connect directly to Celestia for increased velocity, scale and security.
These are examples of actual modular blockchains in production. Today, they are being used to launch scalable, flexible systems with capabilities that traditional chained time-stamped data networks could dream of achieving on a blockchain.
Why Developers Love It
If you've had any experience creating on-chain, you know that the feeling of following someone else's rules is an immense inconvenience. Blockchain modules remove that.
Instead of being based on only one system, developers can create whatever they want, however they want, using the best tools available for each layer.
It deploys faster, upgrades faster, and costs less.
No need to reinvent the wheel. Just assemble the parts and launch.
This Affects Users
This is exciting news for everyone who uses it every day, no more network hopping.
Speaking of the modularity that comes with interoperability, by design, means smoother experiences, unified wallets, and working applications with no bridges, headaches, or delays.
If this stays the same, use of blockchains may become as easy to use as it is to use the internet.
Risks to Consider
Of course, no invention is flawless and modular blockchains are no exception. However, if modules are upgraded too often, they may have compatibility issues. Security and collaboration are such important considerations given that different teams could control each layer.
These are minor challenges when viewing the upside of modularity's benefit of getting around bottlenecks.
Future Web3 Is Modular
Optimize your blockchain like you would an app: no interruptions, no forks, only better performance. Introducing, "It's going there."
Blockchain development is Agile. The structure is modular. This way teams can deploy products in weeks rather than months, iterate quicker, and update new technology right when it comes out. In the future, there will be constant innovation and scalability will be standard.
Road Ahead
Creating a blockchain might eventually be as simple as developing a website. It's as simple as hosting your execution, consensus, and data modules, and hitting "go live."
This is all part of the "Blockchain-as-a-Service" strategy which, like clouding computing did with Web2, is poised to make Web3 easy, inexpensive and infinite.
Conclusion
Modular blockchains revolutionize scalability, usability, and creativity. Developers and end-users can finally coexist in a smooth and flexible environment without the hassle of chain space, or maintaining multiple networks.
Progress that creates a foundation for the future of decentralized technology. Future blockchain is not larger single blockchains. Smarter design is modular, networked, and for everyone.
This article is contributed by an external writer: Razel Jade Hijastro.
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