Key Takeaways

• Celestia is taking on conventional, “monolithic” blockchains with a modular approach.
• Through Data Availability Sampling, light nodes can verify transactions without downloading an entire blockchain.
• The network inherently scales as more users join it, creating, in theory, an ever-expanding blockchain. 
• Celesta’s AWS-like approach to architecture hopes to lower the barrier for dApp developers.

 Bottleneck in Blockchain Scaling No One Saw Coming

Blockchain networks are built to work en masse — a decentralized, global solution to many of the world’s financial, supply, and governance problems. But while that vision is sound, the technology still has a way to go regarding scalability.

Most blockchains follow a “monolithic” architecture, one where transaction settlement, execution, and data availability all happen on one layer. All of that is a lot to handle, leading to network congestion, which limits scalability. Ironically, the more popular a network gets, the worse it may perform, unless the correct infrastructure is in place.

Many solutions attempt to address blockchain limitations, like scalability solutions such as sharding and rollups, or alternative consensus mechanisms like proof-of-stake (PoS). However, many of these solutions introduce the data availability problem.

Say you want to run a full Bitcoin node (become a block producer). You need to download the whole blockchain’s history, as you need all of its data available to you. When a node broadcasts a transaction, you and every other node check that transaction against Bitcoin’s history, hence the network’s longer transaction validation times. 

You can also run a light node, which can send and receive Bitcoin without downloading its entire history. Instead, light nodes download block headers, essentially summaries of full blocks. They then rely on full nodes to receive block data.

This works on a monolithic network like Bitcoin, which doesn’t require instantaneous transactions. However, downloading a network’s full transaction history becomes problematic when it comes to scalability: the process is computationally expensive and time-consuming as a network grows, limiting node participation to those with the space and bandwidth for it. 

Many scalability solutions, like sharding or layer-2 rollups, rely on partial node validation. Processes where nodes don’t need a network’s entire history to function. But how do they ensure security?

Also, the data availability problem goes beyond nodes simply downloading a blockchain’s entire transaction history. It’s about nodes being able to publish and access all of the transaction information they claim to have. If full nodes don’t have all of a network’s data, malicious block producers can lie about transactions they’ve published, destroying the trustless nature of blockchain and leading to issues like the double-spend problem. 

It’s like if a bank could move your money around without showing you proof. Sure, the bank can say it moved money to pay for one of your bills, but if you don’t see the transaction record, you can’t know for sure. The bank could claim it processed your transaction while using the funds for something different. 

If block producers aren’t required to publish all transaction data, the same problem can occur. But requiring block producers to publish all of that data takes time and computational power, as does ensuring that every other node can validate it. 

So, how does a network scale without sacrificing security? Blockchain network Celesia believes the answer lies in a modular approach.

What Is Celestia? A Modular Approach to Data Availability

Pitched as a “data availability network that securely scales with the number of users,” Celestia tackles the data availability problem by focusing on it alone. It separates transaction settlement and execution into their own chains, emphasizing a process called data availability sampling (DAS) instead of trying to be an all-in-one solution.

How Celestia Works: Decoupling Consensus and Execution

This modular approach breaks up the following core blockchain functions:

• Execution: Where nodes process valid transactions.
• Settlement: Where nodes can verify transaction proof to ensure they are valid. Multi-chain networks like Celestia often process settlement through sovereign rollups.
• Consensus: Where nodes order transactions (typically by date).
• Data availability: Where each node ensures all of its data is available to check against every other node.

By ensuring each process is on its own chain, Celestia provides optimized versions of each function for other networks. However, it’s important to note that modular blockchains are more of a mix-and-match toolkit. Developers can use a consensus and execution layer without a settlement layer if they prefer.

Alongside breaking up each blockchain function, any node from a light node to a full node can process transactions on Celestia. However, the network’s main draw is its ability to function primarily via light nodes, which is where data availability sampling comes in.

For DAS to work, light nodes sample random bits of block data from across the network rather than downloading whole blocks. As light nodes continue to complete their data sampling, their confidence in available data will increase. Once a light node hits a certain confidence level, it will broadcast that the data is available.

In theory, the network would have more than enough nodes sampling small amounts of data to ensure none of it is being withheld by a bad actor. In fact, as more nodes join the network, more sampling checks come to be, meaning the network will increase in security as it scales.

Essentially, Celestia creates a system where verification is a shared, scalable process rather than requiring every node to have the full ledger. From there, it presents transactions in the order they were made, while ensuring all data is always available.

The process works through a combination of nodes:

• Full nodes: Full nodes, such as validator nodes or consensus nodes, work like they do on other blockchains: validator nodes produce and validate blocks, while consensus nodes contain the full Celestia history. Most blockchain networks stop there.
• Bridge node: Unique to the Celestia network, bridge nodes bridge blocks between the data-availability network and the consensus one.
• Light node: Light nodes are the backbone of the data availability sampling process.

With light nodes making up most of the data availability layer, what about the others?

Modular Stack: Integrating with Rollups, DA Layers, and L2s

While Celestia will primarily focus on data availability, part of the project’s pitch is its integration with other networks.

For example, a decentralized app (dApp) developer may choose Celestia’s consensus and data availability layers while taking advantage of Optimism’s rollups for execution and Ethereum for settlement. 

The idea is for developers to choose their top functions, harnessing what they need to best deliver their services. A simplified, modular dApp development method. The network isn’t trying to be everything. It’s trying to be the best at one thing, while supporting the best of the rest.

Why Developers Are Choosing Celestia

This modular approach, in theory, brings countless benefits to dApp developers:

• Focused development: A modular blockchain approach allows developers to focus on building their dApp while other networks handle transaction processing and smart contracts, amongst other requirements.
• Faster startup: By relying on established projects, developers don’t need to spend time and money building infrastructure.
• Inherent scalability: With Celestia’s light node-focused approach to scalability, developers need not worry about building their own scalability solution.

Celestia already supports dozens of apps, and with just under 400k followers on X, the network has undoubtedly made a name for itself. Its presence as a modular blockchain seems to be growing, and so is its number of integrations.

Challenges: Security, Adoption, and Interoperability

Of course, no solution is without its challenges. Celestia’s method solves some problems while introducing others:

• Security considerations: Celestia’s scalable security method via light nodes is ideal in practice, but in reality, it’s still a relatively new approach to consensus. A weakness in the DAS framework may not be understood until it’s under threat.
• Interoperability pain points: While interoperability is generally seen as a good thing, Celestia requires a fair amount of bridging between networks. Bridges are weak points when it comes to security, making them prime targets for bad actors.
• Complex education: A modular approach to blockchain requires developers and users to accept a new normal. Participants on either side are used to monolithic chains, so the modular approach could require some in-depth onboarding.

Is Celestia the AWS of the Modular Blockchain Era?

Celestia resembles Amazon Web Services in a few key ways, largely by providing infrastructure so developers can focus on apps. Before Amazon’s cloud computing initiative, web-focused companies had to build their own servers. Server hosting is expensive, especially at scale, so Amazon built cloud computing as a service. While blockchains don’t require servers, they do require consensus and security. Building a decentralized foundation takes time, money, and expertise.

Both AWS and Celestia lower the barrier to entry for app developers, and the latter hopes to deliver where the former revolutionized. Celestia’s modular approach is certainly unique and may popularize a new form of development. However, AWS took off because of its simplicity. The question remains: can Celestia achieve that same level of accessibility? 

If it can, Celestia won’t just be a part of blockchain’s future. The network will help define it.