Introduction to the Implementation Layer Network: Enhancing Computational Efficiency through Parallel Computing and State Reduction
Fuel Network, a modular Layer 2 solution that raised $80 million in funding in 2022, has recently released its Beta-5 testnet and is expected to launch its mainnet in the third quarter of this year. What makes Fuel Network capable of solving the current limitations in transaction performance and state bloat?
Table of Contents
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Introduction to Fuel Network
Modular Execution Layer
Technical Architecture of Fuel Network
Problems Solved by Fuel Network
Low Computational Efficiency: Parallel Computing
State Bloat: State Minimization
Enhanced Interoperability: Introspection
Development Status of Fuel Network
Team: Overlapping Core Members with Celestia
Capital: $80 Million Funding
Marketing: Market Ecosystem is Still Developing
An Unconventional Execution Layer Network
Introduction to Fuel Network
Fuel Network is a decentralized Layer 2 network based on Optimistic Rollup, focusing on the execution layer that handles transaction computation in modular blockchains. Its concept is to have more bandwidth and computational power while using fewer resources. Fuel Network aims to optimize the computational capacity of existing decentralized networks through parallel computing, state minimization, and enhanced interoperability.
Unlike mainstream Rollups like Arbitrum, the execution layer provided by Fuel Network is not a mere replication of existing architectures. Instead, it offers more efficient computational capabilities through innovative virtual machines, programming languages, and developer tools.
The technology stack of Fuel Network can be primarily divided into three parts:
FuelVM:
It uses the UTXO model for state access and allows full nodes to identify the accounts involved in transactions, mapping out dependency relationships before execution. This enables Fuel to utilize more CPU threads for parallel computing, state minimization, and enhanced interoperability, all of which are derived from the innovative design of the virtual machine FuelVM.
Sway:
It is a programming language designed specifically for blockchain environments, combining the strengths of Solidity and Rust to facilitate development in both languages.
Forc Toolchain:
It provides developers with easy-to-use tools for developing and deploying dApps on the Fuel chain, allowing customization and extensibility to meet different developer needs.
The Ethereum ecosystem is currently experiencing a period of explosive growth in modular L2 chains. Although Ethereum has made significant progress in performance and functionality through Rollups, it still lags behind other competing chains in terms of computational capacity.
By utilizing FuelVM, Fuel Network can enhance three major computational performance aspects of existing Rollups:
Parallel Computing: For performance.
Fuel Network satisfies users’ increasing demand for transaction bandwidth by executing transactions in parallel across multiple processors, avoiding the delay in transaction confirmation caused by waiting for the execution of other transaction blocks.
State Minimization: For sustainability.
Based on the UTXO design, Fuel Network minimizes state growth during transaction execution, reducing the hardware burden on nodes and improving the long-term decentralization of the network.
Enhanced Composability: For the ecosystem.
Through its special smart contract introspection mechanism, Fuel Network achieves block-level composability, thereby enhancing the security of the overall network and cross-network interactions.
Next, we will focus on discussing the unique virtual machine FuelVM and the three innovations and advantages it brings.
Traditional EVM executes only one transaction at a time, while the rest of the transactions have to wait in a queue, resulting in inefficiency. Parallel computing allows multiple transactions to be executed across multiple processors, eliminating the need to wait for the execution of other transaction blocks and confirming transactions.
Recommended Reading:
Introduction to Layer1: Understanding the Highlights of Sei Network v2 in Plain Language
Reason for recommendation: Although the operating principles are different, reading this article can help understand the parallel computing of blockchain virtual machines from a more value-based perspective.
FuelVM implements improvements to the EVM that developers have been proposing for years. These improvements, which have been delayed due to the need for compatibility, are now made possible by Fuel’s use of the UTXO model for strict state access. By managing hardware through FuelVM and allowing full nodes to identify the accounts involved in transactions and map out dependency relationships before execution, Fuel can utilize more CPU resources. Typically, these CPUs are idle in single-threaded blockchains. As a result, Fuel can provide more computational power, state access, and transaction throughput than single-threaded blockchains.
State refers to the “latest ledger information of a decentralized network,” including all account data and token distribution in the network. Traditionally, state data needs to be accessed extensively on disks to allow quick access by nodes. This process, apart from signature and hashing, is the slowest in transaction processing. Storing state is an undeniable cost and a development barrier to network performance as the network usage increases over time.
Unlike historical data, which can be discarded or expired (account data cannot be discarded for each address), the state size continues to grow as the network’s usage duration increases. This phenomenon has become a hidden concern for future network performance.
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Why is State Bloat the Ultimate Boss in the Development of Blockchain Scalability Solutions?
Reason for recommendation: This article describes the current state bloat situation and challenges from the perspective of the founder of Fuel Network, providing a clearer understanding of the unique value of Fuel Network’s solution and serving as a prelude to this article.
Based on the above issues, Fuel Network offers the native state rehydration feature through the design of FuelVM. Developers on FuelVM can dehydrate the state using the dehydration feature and rehydrate it when needed, reducing the overall size of the state.
Unlike Ethereum and other traditional approaches that require accessing the state of the entire network at all times, Fuel Network compresses and deactivates the state, increasing the efficiency of accessing state resources.
In addition, Fuel Network provides other designs for developers to develop smart contracts while minimizing state growth:
Scripts:
Scripts, like smart contracts, possess computational logic and can be stored in transactions instead of the state, reducing the state size. Additionally, scripts can be executed through transactions, calling zero or multiple smart contracts.
Predicates:
Predicates are lightweight, stateless smart contracts responsible for pure transaction authorization mechanisms. Predicates can only access historical transaction data and cannot access the latest state of the chain.
The architecture of Fuel Network aims to integrate all these features to achieve minimal state execution, ensuring that the performance of long-term network development is not hindered by the state.
In the blockchain industry, introspection refers to the ability of smart contracts to inspect, analyze, understand their own properties, and the state of the blockchain. This feature allows smart contracts to make automatic decisions based on the current transactions, state, other contracts, and their own execution results.
Introspection is a powerful feature that enables more complex, dynamic, and responsive applications on the blockchain. It allows contracts to adjust their behavior based on the changing conditions of the network, enhancing the efficiency of cross-chain functionality and decentralized applications (dApps).
Furthermore, Fuel Network also provides innovative transaction models, such as allowing multiple input variables when triggering a contract and even accepting predicates, maximizing the utility and composability potential of contracts.
Fuel Network offers greater flexibility in the structure of transactions, including inputs and outputs.
(Source: Data Source)
The team officially launched the Beta-5 testnet on the 1st of this month, and the mainnet is expected to be launched in the third quarter of this year.
Fuel Network is closely related to Celestia. Besides both projects emphasizing modular design, John Adler is a co-founder of both projects, resulting in some overlapping core team members.
The two projects complement each other in different aspects while operating in the same field. Celestia is responsible for the data availability layer, while Fuel Network enhances the performance of the execution layer. It is expected that there may be more collaborations between the two projects in the future, as hinted in their whitepaper.
Fuel Network focuses on improving computational efficiency while reducing state storage, while Celestia focuses on optimizing storage efficiency.
Fuel Labs was founded in 2019 and completed its $80 million Series A funding in 2022, led by Blockchain Capital, following its seed round investment in 2021. It was one of the larger funding projects at that time.
Users can now download the official web3 wallet, Fuel Wallet, from the official website and obtain test tokens from the faucet or use the official cross-chain bridge to cross from the Sepolia testnet. This allows them to use the protocols on the Fuel Beta-5 testnet. However, most of the protocols on this testnet are still in the development stage.
The ecosystem on the Fuel Network Beta-4 testnet only consists of basic DeFi services, including DEX, lending, asset cross-chain bridges, an NFT trading market, and on-chain analytics tools. Currently, there are no innovative products leveraging the network’s features.
Fuel Network, with its focus on the execution layer, does not continuously optimize existing frameworks but instead designs innovative virtual machines, parallel processing mechanisms, and state minimization in different ways to achieve higher computational efficiency. It does have certain advantages.
However, it is worth noting that improving performance has gradually become a highly competitive market in the blockchain field. Various Rollups, competing chains, and even non-blockchain stateless infrastructure are constantly optimizing to provide the most efficient computational space. As a network positioned around “computation,” Fuel Network faces significant challenges in occupying a dominant position.
(Arweave recommends the decentralized computing network ao to create an innovative smart contract computing environment)
Celestia
Fuel Network
Rollups
Modularity
Further Reading
What Technological Innovations Does zkSync Have? How Can It Impact the Existing Rollup Ecosystem?
Perspective: Why Did Starknet Airdrop Reach Millions of Wallets? Why Now?
