NEAR has announced that it is combining the capabilities of monolithic and modular blockchain scaling. Both are different when it comes to performing a set of four functions. Identified as vital functions, they must be performed to keep the ecosystem running. These are data availability, execution, consensus, and settlement.
A monolithic blockchain performs all the functions through the same set of nodes. This works well but also has certain limitations.
As for advantages, monolithic blockchain scaling offers high security, improved utility, and convenience in deployment. The same set of nodes specializes in the entire network. Hence, offer these benefits. Limitations come into the picture when computations are demanding, forcing them to make some sacrifices with the principles of decentralization. The cost of verifying the chain increases and hints at the restrictions with monolithic blockchain scaling.
Modular blockchains break down the functioning manners. They create dedicated layers for every function to improve efficiency.
While the concept of modular blockchains is pretty old, it gained traction only when it was noticed on Ethereum Layer-2 networks.
All four functions—data availability, execution, consensus, and settlement—are mandatory and vital. Data availability makes sure that data is available for verifying the state. Execution is the layer that users interact with at the time of signing the transaction. Other reasons for them to interact with the layer are the deployment and transfer of smart contracts.
Settlement is a point where transactions have been included in the blockchain and can’t be ruled out. However, it follows consensus, which is a stage where nodes agree on the decentralized network.
The community is fascinated with the development. Many members have appreciated the move and have called it impressive. Others have said it is nice to know how blockchain technology affects the world.
That said, NEAR, its native token, is down by 2.92% in the last 24 hours at the time of drafting this article. The token is exchanging hands at $4.01. It further reflects a fall of 4.32% and a jump of 87.53% in the last 7 days and 30 days, respectively. As per the Near crypto price prediction, the coin could reach around $5 by the end of this year.
Kendall Cole, the Chief Executive Officer of Proximity, proposed the idea of combining monolithic and modular blockchain scaling. The presentation was delivered at NEARCON 2023. His presentation covered the details of how NEAR will interface with the broader crypto tech stack in 2024 and in the years to come.
The announcement by NEAR Protocol comes after it summarized its developments for 2023. NEAR was able to launch the BOS and NEAR DA. It joined hands with Eigen Layer to achieve fast finality for Ethereum rollups. NEAR surpassed 6 million MAAs, and the three largest Web3 dApps clarified that they are hosted by NEAR.
