Monolithic vs Modular Blockchains

Consensus

Consensus defines the normative truth of the data stored on the blockchain.

In these categories, we found Pow and Pos. These are the systems that define how the block is added to the chain and how participants agree that the block is the correct one.

With these, the blockchain can move forward in time without splitting into a million different chains, each of which has its own true version.

Execution/Implement

The execution attribute of the blockchain means that the state of the blockchain is brought to the next block.

Block N has some specific states, which represent the data changes from block N-1 (account balance, contract code, etc.). Then the verifier grabs a bunch of transactions from mempool and creates a state update of block N by generating block N+1. The state of block N has changed according to the transactions extracted from mempool (mempool is like queuing Number of people waiting for bank teller).

When the validator uses the selected mempool transaction as input and the consensus mechanism to calculate the new state of the next block, the transaction is executed.

Data availability

Data availability refers to the data hosted on each blockchain node. If there is data on the node, it is available to anyone and everyone who uses the blockchain; there is no dependency on these data. It is available and complete.

The amount of this data available is extremely limited (we call it block space!). When you add some data to the blockchain, you add this data to the computers of all nodes running the chain (now and forever). The purpose of blockchain is immutable; this means that the data in these systems is the most precious data in human history.

Everyone wants their data (transactions) to be immutable, so people pay high prices to get these attributes, which is why we see very high gas prices on Ethereum L1.

Monolithic blockchain

A monolithic blockchain is a blockchain that tries to accomplish all three things in the same place, namely consensus, execution, and data availability: that is, on L1. Basically, most of the blockchains to date, including the current Ethereum, are monolithic blockchains.

The problem with monolithic blockchains is that they will be affected by the impossible triangle of blockchains. Because the same layer is responsible for making the blockchain become all three components of the “blockchain”, optimizing one attribute of the blockchain will restrict other attributes.【Security, Decentralization and Scalability】

Want to get more block space through faster block time and larger blocks? Then reduce the number of nodes that can keep up with the progress of the chain. In this way, slow computers in the world will not slow down the speed of the chain.

Want to trade quickly? Reduce the number of nodes, so that the total number of computers that actually need to perform calculations will be reduced. In this way, we won’t have a bunch of redundant computers doing the same calculations; we just need to believe that the computers that do the calculations will not lie to the network.

Want to optimize security and decentralization? Reduce the supply of block space and reduce the hardware requirements of nodes, so that everyone can become a participant of the network, but your transactions will take longer to settle.

Monolithic blockchains have brought us to this point, but they are now encountering scale limitations.

This approach makes the network less decentralized as the node validators are forced to keep buying better-performing hardware to constantly keep up. There are concerns about the rate of growth of computing power slowing down as we reach the limits we can fit inside a chip due to quantum tunneling.

The era of monolithic blockchains is coming to an end.

The era of modular blockchain is coming.

Modular blockchain

The modular blockchain uses the three components of the monolithic blockchain currently on L1 and separates them. Just like the division of labor, after splitting each component, we can optimize each component and produce a better product, making the whole larger than the sum of the parts.

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Blockchanin Dilemma

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Ex：Solana—scalability first, security second, and decentralization last

Modular execution with Rollup

Rollups can process transactions much faster than the main chain.

By creating a transaction execution environment independent of Ethereum and processing transactions before updating the state of L1, Rollups can exempt the responsibility for consensus and data availability.

Rollups do not have to focus on consensus or data availability like the highly decentralized L1; they are free to make any and all sacrifices on these attributes, because Rollups has an encrypted connection with Ethereum. In other words, Rollup is created by trading on Ethereum, and the Rollup promises to abide by a set of rules.

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