Celestia TIA Mainnet Launch | Opportunities and Challenges of Modular Blockchain Future

The ancestor project of modular data availability layer DA, Celestia, will launch its mainnet on October 31st today. In addition to the recent discussion on airdrops, the token will also be listed on exchanges such as Binance today. This article details the recent important news about Celestia, introduces the modular blockchain field, and elaborates on the positioning of the Celestia project, as well as the opposing views on the future of this project. Source

Celestia Recent Highlights

Mainnet Launch

According to a report by foreign media, Celestia's mainnet is scheduled to go live today, October 31, and major exchanges will also launch trading markets. According to an official announcement from Binance, Celestia's token TIA trading pairs will be available starting at midnight on October 31.

Token Economics

According to the official documentation from Celestia, the basic information of the TIA token is as follows:

• Token Name: TIA

• Genesis Total Supply: 1 billion tokens

• Inflation Rate: 8% for the first year, decreasing by 10% each subsequent year to 1.5%, used for network maintenance and security

The distribution of the initial billion tokens is as follows:

• Genesis Airdrop: 7.4% completed on 10/17

• Community Rewards: 12.6%

• Research and Ecosystem Fund: 26.8%

• Early Investors: 35.6%

• Team: 17.6%

The token has four main use cases:

• Network Fee Payment: Paying fees for Celestia nodes to upload data to the mainnet, ensuring data availability.

• Node Staking: Tokens required to become a Celestia node.

• Governance: Voting on network issues and managing the 2% network rewards community treasury.

• Building Blockchains: Developers can use TIA as fuel to quickly build Rollups based on Celestia.

Establishment of Foundation

The team will establish the Celestia Foundation in Liechtenstein to guide the Celestia ecosystem in the future and maintain its value. The foundation's values focus on fair pursuit of public interest, with four main goals:

• Funding efficient decentralized systems and secure nodes.

• Funding open-source modular blockchain ecosystem products.

• Supporting and encouraging open-source project development processes, such as Celestia's CIP.

• Supporting Celestia's infrastructure and application development.

The team emphasizes that the Celestia community values off-chain governance similar to the Ethereum Foundation. To ensure loyalty to the community vision and values, the team has selected four foundation-led members, including two executive members, Mustafa Al-Bassam and CTO Ismail Khoffi.

Celestia Introduction

Founded in 2019, Celestia's primary product is a modular data availability layer aimed at becoming the underlying infrastructure for various blockchains to enhance network performance.

Modular Blockchain

To understand Celestia, one must first understand the concept of Modular Blockchain.

The blockchain has long been constrained by the impossible triangle problem, constantly balancing decentralization, security, and efficiency, with efficiency often being compromised to ensure network decentralization and security.

As a result, many methods have emerged to improve efficiency, including sidechains, Plasma, Layer2, sharding, among others, embodying the spirit of modularity. For example, Layer2 networks built on the Ethereum mainnet separate the execution layer to demonstrate independence.

The potential for improved efficiency in modular blockchains extends beyond Layer2. Instead of simply separating the execution layer, true modular blockchain concepts can be divided into three network layers:

• Execution Layer: Virtual machine executing smart contracts

• Settlement Layer/Security Layer: Records network monetary flow changes, ensures finality and validity

• Data Layer/Storage Layer: Records original transaction information

The concept of each layer is briefly described below:

Execution Layer: The Execution Layer is like the CPU that computes the results of running smart contracts. Running smart contracts involves calculations to produce results. For example, the original transaction information only states "0xabc… from 0x123… contract address," and nearby nodes must pull out the contract code and corresponding functions to calculate the result. The result could be something like "0xabc did something," such as "stake 20 MKR tokens to the Maker contract." The more complex the smart contract, the more resources the Execution Layer needs for computation.

Settlement Layer: The Settlement Layer records the global state and monetary flow changes on the network. It records the computation results of the Execution Layer "what 0xabc did" on the chain, not the complete data, only recording the global state and monetary flow changes.

Data Availability Layer: The Data Availability Layer records the pre-execution raw input database. It includes the complete data of original transaction data like "0xabc… from 0xjkl… contract address." If there are suspicions about the Settlement Layer's results, the original transaction data can be called from this layer to recalculate and redo what the Execution Layer did to check if the results are consistent.

By utilizing the division of labor among layers, the efficiency of each layer can be maximized. For example, Layer2 can focus on executing smart contract computations using centralized servers, the Ethereum mainnet can focus on recording the Settlement Layer, and original transaction information can be stored in the Data Availability Layer rather than the expensive Ethereum mainnet.

Celestia Roles and Goals

Apart from serving as a Layer2 settlement for Ethereum, Celestia also needs to provide services for other smart contract projects like Uniswap or OpenSea, which significantly increase the burden on the Ethereum mainnet and congest network space.

The protagonist Celestia is the founder of the data availability layer, aiming to reduce on-chain data volume on the Ethereum mainnet and lower transaction costs. However, many are concerned about the security if original transaction data is not stored on the Ethereum mainnet.

Therefore, Celestia's role is to be the foundational infrastructure of the ecosystem, requiring a network willing to cooperate on the data availability layer. For example, the recently announced collaboration with Arbitrum Orbit allows any blockchain network built using Arbitrum to easily integrate Celestia as the data availability layer.

Other Data Availability Competitors

In addition to Celestia, there are other data layer providers. Leading players in the field include Polygon Avail, and even Ethereum's EIP-4484 proto-danksharding proposal could pose competition to Celestia. The former recently started testing on the testnet, while the latter is expected to be completed by May or June next year, directly impacting the landscape of all modular blockchain technologies.

Celestia's launch marks its official entry into the market, aiming to seize market share quickly.

Celestia's Future Opportunities and Challenges

While Celestia's future seems promising, not everyone is optimistic about the project. Chinese crypto researcher Faust has expressed negative views.

Faust notes that the TIA token can serve as fuel for recording transaction information, offering more frequent use cases than ARB and OP. Even if the ecosystem is fully developed, its governance value should not be underestimated. However, Faust believes that Celestia's strategy carries a certain level of risk and disadvantages. The main reasons include:

Success in the Ecosystem Relies on Strategy, Not Just Technology

Faust points out that the most successful blockchain project is Polygon, which, while not having the most top-notch technical team, has succeeded in building the most successful market ecosystem. The ecosystem includes Ethereum Layer2 Polygon zkEVM, standalone chain Matic, data availability layer Polygon Avail, and a range of products. Polygon also has an open-source modular blockchain suite, Polygon CDK, which is more comprehensive in modular blockchain technology than Celestia.