What are Modular Structures in Crypto and How Do They Work ?

Today, as blockchain technology evolves rapidly, monolithic and modular architectures stand out as the two main structures that stand out. In this article, we will take an in-depth look at the working logic, advantages and disadvantages of both blockchain architectures.

Basic Structures and Operating Logic of Monolithic Blockchains

Monolithic blockchains are considered the first and simplest form of blockchain technology. These structures centralize all functions on a single chain. Examples such as Bitcoin and Ethereum use this approach to process, verify and settle transactions between nodes in the network within a single system.

Working Logic of Monolithic Architecture:

1. Execution: Transactions are executed at this stage. For example, a user initiates a cryptocurrency transfer, and this transaction is executed on the blockchain.
2. Data Availability: Processed data is shared and accessible to all nodes in the network. Every node stays up to date with this data and can access it reliably.
3. Consensus: An agreement between participants in the network to add new blocks or verify transactions. This maintains the blockchain’s reliability and data integrity.
4. Settlement: Once transactions are confirmed, blocks are permanently attached, and transfers are completed. This is the stage where transactions are finally confirmed and permanently added to the blockchain.

Let’s explain with a small example: A user initiates a transaction (execution), the transaction is shared with all nodes in the network (data availability), the nodes use consensus mechanisms to confirm the validity of the transaction (consensus), and the transaction is permanently added to the blockchain (settlement). This process summarizes how cryptocurrency transfers take place within a monolithic structure.

Pros of Monolithic Architecture:

1. Simplicity: Monolithic blockchains are simple in design and use, which makes the code easier to maintain and increases understandability.
2. Security: Data security and integrity are ensured as all transactions are carried out in a single structure.

Disadvantages of Monolithic Architecture:

1. Scalability Issues: Growing and evolving systems can lead to scalability issues. Updating one component can affect the entire application.
2. Lack of Flexibility: Any change affects the entire system, which complicates the development process.
3. State Bloat: Transaction data on the chain increases the size of the blockchain over time and leads to high hardware requirements for nodes.

Modular Blockchains: Flexibility and Layered Approach

Modular blockchains aim to balance security, scalability and decentralization by separating the basic layers of tasks into different layers. This structure allows different components to be combined and aims to create a flexible, scalable blockchain structure.

Working Logic of Modular Architecture:

1. Layered Structure: Transactions and data accessibility are handled in different layers. This allows each component to be developed and managed independently.
2. Data Availability Sampling: This technology is used to validate large blocks without fully downloading them, thereby increasing data availability and reducing costs.

Advantages of Modular Architecture:

1. Flexibility and Scalability: The modular structure increases the flexibility of the system and provides scalability.
2. Reusability: Modules can be reused in other projects, speeding up the development process.
3. Fault Isolation: A fault in one module does not affect other modules, which increases overall system stability.
4. Ease of Maintenance: The modular structure ensures that each module can be maintained independently.

Disadvantages of Modular Architecture

1. Complexity: The modular structure can increase the complexity of the system and interaction issues between modules can complicate the development process.
2. Compatibility Issues: Incompatibility and version issues may arise between individual modules.

Projects Using Modular Architecture

Celestia

• Function: Modular data accessibility network.
• Overview: Celestia ensures the accessibility of blockchain data and allows developers to launch their own blockchain at low cost. It can process large blocks securely and efficiently with data access instantiation.

Fuel Network

• Function: Modular blockchain protocol.
• Overview: Fuel Network is a protocol that works independently of Ethereum. It offers a flexible and scalable structure thanks to the Sway software language and allows users to create their own blockchain.

Avail

• Function: Data accessibility and block validation.
• Summary: Avail provides a strong data accessibility layer and performs block verification using erasure codes at low cost. It adapts to multiple execution environments.
• Function: Platform that enables multiple blockchains to work in harmony.
• Overview: Polkadot enables the interoperability of different blockchains and allows data and assets to be transferred between various chains. Its modular structure makes it easy for blockchains to work together.

Dymension

• Function: Modular blockchain structures and customizable rollup solutions.
• Overview: Dymension offers a modular framework for customizing and scaling blockchains. With Rollup solutions, it aims to build high-performance and secure blockchain applications. It provides customized blockchains according to users’ needs and increases scalability and security.

Conclusion

Monolithic blockchains offer the advantages of simple design and security, but have limitations in scalability and flexibility. Modular blockchains offer the advantages of flexibility and scalability but come with complexity and compatibility issues. Choosing the appropriate architecture based on project needs ensures the best utilization of blockchain technology.