As Ethereum’s layer 2 networks become increasingly crowded, experts are trying to figure out how to handle the growing number of transactional details. The goal of these networks is to reduce congestion, and one way to do this is to reduce the number of times data needs to be downloaded from the main network. This is known as the data availability problem and is solved using cryptography and advanced mathematics. Ethereum developers have proposed their own plans for handling the data, known as EIP-4844 or proto-danksharding. This measure is expected to significantly scale the blockchain and introduce blobs for data, which helps the blockchain to process that data more efficiently and cheaply.
However, there are also new players, such as Celestia and Avail, who are developing alternate solutions for data availability. These solutions are seen as integral to layer 2s, as users and developers look for space for their data on Ethereum. According to Alchemy, a blockchain infrastructure startup, the data availability layer is a system that stores and provides consensus on the availability of blockchain data. Its goal is to help reduce the data load from a mainnet blockchain and therefore lower transaction fees for users of layer 2s, also known as rollups.
Understanding data availability and how it works can get quite technical, but an analogy that the team at Avail likes to make is to a user who uploaded a photo to Google, and then wants to make sure the photo is actually there. The user queries Google, which responds with a fragment of the photo; the exercise is the confirmation; the user doesn’t need to download the photo, just to make sure it’s there.
Ethereum developers have explored other ways in which they can address the issue of data on the blockchain, such as sharding, which splits the blockchain into smaller pieces. Proto-danksharding, or EIP-4844, is the first prototype for this concept that will go live as early as the end of this year during the Dencun upgrade.
Data availability layers, such as Celestia and Avail, are betting that they are going to become more integral to layer 2s, as users and developers look for space for their data (on Ethereum). According to Karl Floersch, CEO of OP Labs, the main developer of the layer-2 blockchain Optimism, “Your L1 data, fundamentally from just an architectural perspective, is going to be supreme. There’s never going to be better data.” Alex Gluchowski, CEO of Matter Labs, the company spearheading the zkSync era rollup, says proto-danksharding is the preferred way of scaling, given that it inherits the underlying security from the Ethereum blockchain.
Floersch also believes that “No one data availability provider should take the whole alt-DA marketplace. There should be a lot of different solutions, different trade-offs, different teams.”