The ABCs of Modular Blockchains: A Beginner’s Handbook
What’s the big deal about modular blockchains?
If you’re active on Crypto Twitter (CT), you couldn’t have missed the current engagement around “modularity.” There’s either a new modular blockchain, a liquidity protocol for the modular era, or a modular security stack — it’s a long list. And It doesn’t look to be changing anytime soon.
But what’s peculiar about ‘modularity?’ Another overhyped blockchain lingo?
Although seemingly new in terms of engagement, the term ‘modularity’ isn’t exactly a first-timer as far as blockchain architecture goes. Modularity in blockchains has always existed as the direct opposite of a monolithic blockchain. Monolithic blockchains are the first-gen blockchains that were designed. Blockchains like Binance Smart Chain and Bitcoin are monolithic blockchains.
The blockchain architecture is broken into layers including the Application layer, Consensus layer, Settlement layer, Data layer, and Hardware/Infrastructure layer — each layer, completing a certain functionality, including transaction execution, settlement, consensus, and data availability.
A monolithic blockchain combines all of these functionalities and can complete them on a single blockchain. In the same manner, any dApp (decentralized application) developed on top of these types of blockchains must inherit all of these functionalities. Hence, these categories of blockchains are ultimately met with issues surrounding scalability (the ability to complete high-volume transactions without halting the network), cost-effectiveness (accessing affordable network fees while enjoying high transaction throughput), and decentralization (opening opportunities to secure the network to anyone willing to be a part of it).
Whereas, ‘modularity’ introduces a blockchain architecture design that doesn’t require a single blockchain to fulfill all functionalities across all blockchain layers. Blockchains with modular designs break down the different functionalities of a blockchain and focus on a few in which they excel. This is to say you can integrate with a blockchain with a modular design and only use its data availability functionality as with Celestia. In this case, other functionalities including consensus and execution may be outsourced to other blockchains.
This has brought about significant changes to how blockchains are developed. Developers now understand the importance of not overcrowding their chains with every possible functionality. Instead, they can focus on perfecting the functionalities they excel at.
Modular blockchains provide flexibility in development, as dApps aren’t restricted to a blockchain’s setup. Developers can choose the specific layer of a blockchain they need, typically the one lacking for their dApp. This ultimately leads to smoother developer and user experiences. Besides choosing a data availability layer in a blockchain like Celestia, modular blockchains allow developers to craft how they want consensus to be reached, and newer chains can easily set up without requiring every single layer of a blockchain to be a part of their architecture.
Let’s compare monolithic and modular designs with a real-life scenario.
Imagine we have three teens: Kiara, Pete, and Davidson. Kiara excels at doing dishes, Pete is a pancake-making expert, and Davidson is a skilled electrician.
In a monolithic design, Kiara, Pete, and Davidson would all be expected to perform each other’s tasks, regardless of their skills. So, if a new teen like Alex joins, even though she’s decent at making pancakes and doing dishes, she wouldn’t be accepted because she lacks knowledge about fixing cables.
However, in a modular design, it’s sufficient for Alex to handle making pancakes and doing dishes since we have an electrical expert in Davidson. Alex can simply delegate electrical tasks to Davidson, allowing everyone to focus on their strengths.
Aside from the potential to distribute tasks across different blockchains due to modularity, it also brings flexibility. In a modular setup, a blockchain, dApp, or app-chain can choose its security features. This means that a protocol built on a modular stack can define its own security rules and establish its own set of validators, a concept impossible with monolithic blockchains.
Blockchain users and developers alike should not treat the concept of modular blockchains as a versus against monolithic blockchains. Instead, it should be considered an innovation introduced to enhance user experience and security with blockchain technology.
This post offers a low-level breakdown of what modular blockchains and modularity mean. It’s intended to serve as a starting point for anyone, even those with only a slight understanding of blockchain tech, to begin researching, learning, or simply gaining an understanding of modularity.
Please find more in-depth resources on modular blockchains at the following links:
https://cointelegraph.com/learn/monolithic-vs-modular-blockchains
