Why is state bloat considered the ultimate bottleneck in the development of blockchain scaling technology?

Fuel founder Nick Didson pointed out that while most of the technology for blockchain scalability has been addressed, there isn't a proper way to handle the issue of state bloat. What is state bloat? How can this problem be reduced? These are questions that every decentralized network will eventually need to address.

This article is compiled and translated. For any doubts, please refer to the original text.

Status Inflation: The Final Boss of Scalability

The Web3 industry has been striving for efficiency for many years and seems to be gradually reaching the finish line. However, the ultimate boss on the road to blockchain scalability - status inflation, currently seems to have no solution. Perhaps this issue will become the final and biggest bottleneck in scalability.

Key Technologies for Blockchain Scalability

Status Growth Currently Has No Solution

On the issue of blockchain scalability, there are three main technical problems that need to be solved, namely execution efficiency, data availability DA, and state size control. So far, the first two have clear solutions:

• Execution: Ensuring the correct synchronization, verification, and block construction of transactions in a decentralized network. This bottleneck has been resolved, for example, with more efficient virtual machines like FuelVM, Stylus, SVM, MoveVM, or parallel transaction execution methods, and better precompilation.
• Data Availability and Storage: Ensuring synchronization with the blockchain network during state transitions and supporting fraud proofs or validity proofs for Rollups. Similarly, there are many solutions to this problem, such as the introduction of the KanKun upgrade EIP-4844, sharding design, and external data availability layers like Celestia, EigenDA, and Avail.
• Status: Status refers to the "latest ledger information of the decentralized network," including all account data and token distribution in the network. To allow nodes quick access, status data often requires frequent access on disk, making it the slowest process in transactions apart from signature and hashing. As the network's usage age increases, the state size continues to inflate.

Status grows over time and is often seen as a "future problem" that is overlooked. The issue of status growth currently has almost no good solutions across various sectors. If this problem cannot be alleviated, blockchain transaction times will slow down, storage costs will rise, nodes will gradually bear a huge burden, ultimately hindering broader adoption of blockchain technology.

Rollups Cannot Solve the Problem of Status Growth

Existing solutions of Rollups only address execution layer problems, and some modular solutions like Celestia further solve data availability issues. However, if these new solutions cannot address the core issue of status inflation, the blockchain industry will return to a zero-sum game.

Nick believes that addressing the issue of status growth will be the next catalyst for the Rollup ecosystem, which is equally important as the past revolution in execution layer technologies.

The Higher the Efficiency, the Larger the Status

Status size growth is usually positively correlated with execution speed. When the efficiency of a blockchain is higher, the resulting status size is usually larger, leading to various decentralized networks claiming high execution efficiency like BNB Chain, Sei to Base, facing the problem of rapid status size inflation.

Layer1 Introduction | What are the highlights of Sei Network v2 in layman's terms

Why does Bitcoin have slower status growth? Besides lower network efficiency, because it uses the UTXO ledger model, accounts with no balance do not need to be recorded in the status, minimizing the problem of status growth. This makes the UTXO model relatively easier to manage but sacrifices programmability.

On the other hand, Ethereum's state model is a rich ecosystem consisting of account balances, smart contract code, and numerous contract states. Due to the growth in network accounts, tokens, contracts, etc., derived balances, approved records, etc., the network's status continues to increase rapidly compared to Bitcoin.

Blockchain based on the ledger model, with each execution of a smart contract and transaction, the status will expand, leading to network bloating, increased storage needs, slower processing times, and ultimately inhibiting innovation and user adoption.

Therefore, most blockchains currently face the problem of status growth.

Possible Solutions to Status Inflation

Although there are no clear solutions as mentioned above, developers have been discussing and proposing several strategies to manage status inflation in the future. However, many technologies are still in the theoretical or discussion stage, or have other drawbacks:

Allowing Status Development

Some believe that accepting status growth in exchange for greater bandwidth usage is an option. However, Nick believes this is not a good choice as it would increase the hardware requirements of all nodes, thereby reducing network decentralization.

Status Space Cost

Charging network users for storing status data, balancing the issue of storing old data versus excessive space usage. However, this approach needs to consider how to remove old data without affecting the storage of other data, as the status is recorded using a data tree structure, and losing intermediate data would disrupt some branch paths.

Stateless Design

Considering a design where full nodes do not need to store status, relying on transaction and state proofs contained in blocks. Essentially, this transfers the status from Layer1 to Rollups. Although this is the development direction of Ethereum, verkle tree, there are still many unresolved issues regarding its efficiency and maintainability.

Recommended Reading: Not Just Blockchain! How Stateless Infrastructure Brings High-Efficiency Decentralized Networks
Reason for recommendation: In situations where status growth cannot be resolved, not pursuing consensus with "stateless infrastructure" may have the potential to become a decentralized network that replaces blockchain, which is also a topic that some developers are currently discussing.

Un-Merkalizing the state

A technology that manages status data in a different way. Using full nodes to verify all content or sampling transactions using a light client and completely discarding the status tree.

Application-Level Status Compression

Using call data technology to compress status data, exchanging bandwidth for status size, such as compressed NFT cNFT on Solana, which stores ownership proofs of NFTs in a Merkle Tree, requiring nodes to call out data externally when needed.

However, higher bandwidth requirements will restrict the network, potentially affecting the robustness and efficiency of the infrastructure.

Status Inflation Is No Longer a Future Problem

Currently, Ethereum's status size is approximately 267 GB and is growing at a rate of about 2GB per month. If the number of network users and contracts increases in the future, this growth rate will accelerate, making status growth gradually burdensome for blockchain network nodes that require consensus.

Most existing solutions are still in the theoretical stage or have significant flaws. Projects in the market have not reached a clear consensus yet. However, it is certain that the issue of status inflation is increasingly being taken seriously, and more advanced solutions can be expected in the future. The latter part of the article also introduces the innovative solutions proposed by Fuel Network, which will be explained in a separate article.