Author: Snow
Translator: Cedar
Proofread by: KOWEI, Edward, Elisa, Ashley, Joyce
Copyright: Gate.io
Introduction
Traditional blockchain architectures have many limitations, such as slow innovation, limited scalability, and a lack of flexibility in the application layer. To address these limitations, modular blockchains have emerged, breaking down blockchains into different and interchangeable components.
Previously, modular blockchains were mostly summarized as layer1 and layer2, until the co-founders of Celestia first proposed this concept in their article (Fraud and Data Availability Proofs). Since then, discussions about modularity and layering have surged, and with the emergence of modular public chain Celestia, the concept of modularity has officially entered the public eye.
What is Celestia
Celestia is a modular network focused on data availability (DA), capable of securely scaling according to user growth, allowing anyone to easily launch their own blockchain project.
Celestia is referred to as a simplified blockchain because it separates the consensus layer from the application execution layer. The consensus layer requires Celestia to only be responsible for transaction ordering and ensuring its data availability;
The execution layer provides an effective solution to data availability issues by allowing lightweight nodes to sample a small amount of random data from each block to verify data availability. The more lightweight nodes participating in data sampling, the larger the amount of data the network can securely handle, thus increasing block size without a corresponding increase in validation chain costs.
Celestia's technical features
Modular DA network:
Celestia's design separates execution, consensus, settlement, and data availability. This modular structure allows developers to specialize and optimize at each layer, thus improving the overall efficiency and scalability of the network.
Source: https://docs.celestia.org/img/learn/monolithic-modular.png, 2024.3.09
Data availability sampling (DAS):
DAS is a method that allows lightweight nodes to verify data availability without needing to download the entire block. Lightweight nodes randomly sample data blocks, and if they successfully retrieve and verify this data, it indicates that the entire block's data is available.
Source: https://docs.celestia.org/img/learn/reed-solomon-encoding.png, 2024.3.09
Scalability:
The DAS technology allows Celestia's data availability layer to scale. Through DAS, resource-limited lightweight nodes can perform data availability verification as they only need to sample a small portion of block data. The more lightweight nodes participating in DAS, the greater the amount of data they can collectively download and store.
Fraud proof of erroneous extended data:
To address the potential data expansion errors that block generators may encounter, the fraud proof mechanism allows blocks with invalid data to be verified and rejected, thereby enhancing the network's security.
Namespace Merkle Trees (NMTs):
NMTs allow block data to be divided into separate namespaces based on different applications. This means that applications only need to download and process data relevant to them, greatly reducing the demand for data processing.
Source: https://docs.celestia.org/img/learn/nmt.png, 2024.3.09
Building a PoS blockchain for data availability
Celestia adopts a PoS blockchain, named celestia-app, to promote transaction and data availability. This layer is built on top of celestia-core, which is an improved version of the Tendermint consensus algorithm, designed to meet the unique needs of the DA layer.
Celestia's design aims to provide consensus and data availability without involving transaction execution. The role of lightweight nodes in this design is to check whether consensus is reached for each block and to verify the availability of block data, rather than validating transactions. This means that lightweight nodes do not need to rely on a majority consensus from honest nodes to validate the validity of the state, a feature that is typically only enjoyed by full nodes.
By adopting a carefully designed block encoding scheme, lightweight nodes can sample a small amount of random block data to verify the rest of the block with high probability. If any full node discovers suspicious activity, they can notify lightweight clients through data availability fraud proofs.
Data analysis on the Celestia chain
Data costs:
Numia Data released a report titled (The impact of Celestia’s modular DA layer on Ethereum L2s: a first look).
The report compares the costs incurred by different L2s publishing callData to Ethereum in the second half of 2023 with the amounts they might incur using Celestia as a DA layer (assuming TIA is priced at $12). This magnitude of difference indicates that adopting a dedicated DA layer like Celestia can significantly save L2 gas fees.
Data source: @numia.data/the-impact-of-celestias-modular-da-layer-on-ethereum-l2s-a-first-look-8321bd41ff25"">https://medium.com/@numia.data/the-impact-of-celestias-modular-da-layer-on-ethereum-l2s-a-first-look-8321bd41ff25
According to the following data, as of January 9, 2024, users have published data to a total of 56 namespaces. Typically, users publish 30 to 50MB of data to 3 to 6 namespaces daily.
Of all the data received by Celestia, 87% was published to 3 namespaces, which are:
Astroglyph: Provides inscription services that allow users to publish any data on Celestia.
MantaNetwork: OP Stack Rollup launched in conjunction with Caldera.
808080808080808: This is an unknown namespace but appears similar to a Rollup.
Source: https://twitter.com/smyyguy/status/1744419436449222864, 2024.3.09
Operational data
Celestia's current staking rate is 52.8%, with a staking APR of 14.44%.
Source: https://staking-explorer.com/staking/celestia, 2024.3.09
The current mainnet is still running stably, with a total of 905,000 blocks produced and approximately 543.27 million TIA staked, with 100 initial validator nodes, where the top 10 nodes hold 49.94% of the network share, indicating a high degree of centralization in the mainnet.
Source: https://celestia.explorers.guru/, 2024.3.09
Source: https://celestia.explorers.guru/validators, 2024.3.9
TIA token economics
Supply and allocation
The initial total supply of TIA is 1 billion tokens, with the following specific allocation:
Public allocation accounts for 20% of the total, of which 7.4% is for the genesis airdrop and incentive testnet distribution, and another 12.6% is for future incentive distribution. This portion of the tokens is fully unlocked upon release.
26.8% of the tokens are allocated to the Celestia Foundation and core developers for research, development, and ecosystem programs. Of these, 25% are unlocked at release, and the remaining 75% are gradually unlocked over the first to fourth years.
19.7% of the tokens are allocated to early supporters of Series A and B. Of these, 33% are unlocked in the first year, while the remaining 67% are gradually unlocked over the first to second years.
15.9% of the tokens are allocated to early investors in the seed round. Of these, 33% are unlocked in the first year, while the remaining 67% are gradually unlocked over the first to second years.
17.6% of the tokens are allocated to initial core contributors. Of these, 33% are unlocked in the first year, while the remaining 67% are gradually unlocked over the first to third years.
Source: https://docs.celestia.org/learn/staking-governance-supply, 2024.3.09
https://docs.celestia.org/learn/staking-governance-supply, 2024.3.09
In terms of token release and supply changes, Celestia's TIA token has a total supply of 1 billion tokens, which will be constrained according to different unlocking schedules. All locked or unlocked tokens can be used for staking, and staking rewards will be immediately unlocked upon receipt.
The annual inflation rate is shown in the figure below:
The TIA inflation rate starts at 8% per year and decreases by 10% each year until it reaches a long-term issuance rate of 1.5%.
https://docs.celestia.org/learn/staking-governance-supply, 2024.3.09
Token utility
Paying for data storage costs: Developers can submit PayForBlobs transactions on Celestia to pay fees using TIA to obtain data availability on the network.
New Rollup solutions: Developers can use TIA as a gas token to launch new blockchains, similar to how ETH is used in Ethereum-based Rollups. This helps them focus on developing applications or execution layers without the need to issue new tokens.
Proof-of-stake mechanism: Celestia is built on the Cosmos SDK and uses a proof-of-stake mechanism to ensure the security of consensus. Users can delegate TIA to validators and receive a portion of the staking rewards.
Decentralized governance: TIA holders can participate in the governance of the network, voting to decide network parameters and managing the community fund pool, which will receive 2% of the block rewards.
Team Introduction
The Celestia team has an impressive background, composed of excellent scholars, researchers, and engineers in the field of blockchain scalability, all of whom have rich work or entrepreneurial experience in the blockchain scalability sector.
Celestia Labs CEO Mustafa Al-Bassam holds a PhD in blockchain expansion from the University of London. He previously co-founded the sharding smart contract platform Chainspace, which was later acquired by Facebook.
CTO Ismail is the Chief Technology Officer of Celestia Labs and has previously worked as a software engineer at Tendermint (the parent company of Cosmos), Interchain Foundation, Google, and has extensive experience in blockchain technology. CRO John holds a PhD in Computer Engineering from the University of Toronto and previously served as a researcher and engineer at ConsenSys, later co-founding the Optimistic Rollup solution Fuel Labs. COO Nick holds a master's degree from Stanford University and was previously a co-founder of the public chain Harmony.
Investment institutions
In March 2021, Celestia completed a $1.5 million seed round of funding, led by Binance Labs, with other investors including: Interchain Foundation, Maven 11, KR1, Signature Ventures, Divergence Ventures, Dokia Capital, P2P Capital, Tokonomy, Cryptium Labs, Michael Ng, Simon Johnson, Michael Youssefmir, and Ramsey Khoury.
On October 20, 2022, Celestia Labs announced the completion of $55 million in Series A and B funding, led by Bain Capital Crypto and Polychain Capital, with participants including Placeholder, Galaxy, Delphi Digital, Blockchain Capital, NFX, Protocol Labs, Figment, Maven 11, Spartan Group, FTX Ventures, Jump Crypto, W3.Hitchhiker, and a number of angel investors. A source revealed to Coindesk that this fundraising made Celestia a unicorn with a valuation of $1 billion and received four times the oversubscription.
Summary
Modular blockchains are seen as one of the main trends in the future development of blockchain architecture, and Celestia plays an important role in it. Celestia's success benefits from the successful practice of Rollups and technological advancements in Ethereum.
Future development requires not only attention to the progress of the Celestia project itself but also the Ethereum Cancun upgrade and the development of upstream and downstream tracks. With the popularization of blockchain technology and modular public chains, Celestia will show greater potential and value.
