As the blockchain industry continues to thrive, we see newer blockchain networks and applications being added continuously to its ever-evolving ecosystem. These solutions are either developed to enhance existing functionalities or offer novel features that the current blockchain landscape lacks. Monad is one of these innovative developments that has amassed attention from the crypto community since the past few months.
In this research article, we will find out what Monad is and what benefits it brings to the scale of the blockchain industry. We are also going to elaborate on how Monad is different from current leading blockchains – Ethereum and Solana – and how it will be competing against them. Let’s dive into it it.
What is Monad?
Monad is an innovation layer 1 blockchain network aimed to address and enhance the existing scalability issues. By inheriting a novel infrastructure and EVM-compatibility, Monad can achieve up to 10,000 transactions per second (TPS) while delivering much more network efficiency. Its core development is based on improvising the parallel execution capabilities to Ethereum.
The ingenious development approach of parallel transaction execution differentiate Monad from other typical blockchain models. While traditional blockchains opt for sequential transactions, Monad’s parallel transactions facilitate simultaneous execution that leads to optimal throughput. Moreover, the MonadBFT – core consensus mechanism behind Monad – unlocks higher efficiency by ensuring seamless transaction executions with a single second block timing.
One of the key-features of Monad is its compatibility with Ethereum Virtual Machine (EVM). It can seamlessly interact with EVM-bytecode while maintaining state with Ethereum RPC and APIs. This feature outlines Monad’s commitment to scalability, simplicity and accessibility as it allows Ethereum developers to upscale their dApps easily.
How Monad Is Different?
Monad is a base layer blockchain that enables parallel execution. We can say that it takes the scalability approach of Solana and performs the similar functionalities on Ethereum. To fully understand how Monad is different, we first need to clear the concept of Parallel Execution on blockchain.
What is Parallel Execution?
All existing EVM-based blockchains inherit the typical infrastructure of Ethereum that faces the drawback of sequential execution. This method allows execution of only one transaction at a time which is highly inefficient. Although it can be helpful when simultaneous transactions are dependent on each other but If two transactions are independent, it raises a major issue.
Let’s understand this via an example. Suppose Jack pays Jill $5 and Jill has to pay $10 to Dave. Here, the state would first need to update Jill’s balance and then execute a transaction to Dave hence the sequential execution is found necessary. However, if Jack pays $5 to Jill and Bob pays $10 to Jill, the interdependency would not be required. In this case, both the transactions can be processed simultaneously.
The dependency of transactions is more obvious in some cases. For instance, a simple token transfer between two wallet affects no one else on the network but transactions interacting with the same smart contract can change the state hence it can not be executed in parallel. One of the main challenges while using parallel execution is querying inter-dependent and independent transactions.
How Monad Solved Parallel Execution?
Developers within the blockchain community identified this bottleneck and have been trying to solve parallel execution. Solana was one of the first projects to implement parallel execution which allowed it to achieve over 1000 TPS. However, to achieve this speed they had to design their own Virtual Machine (VM) which is not compatible with Ethereum.
Monad enables parallel execution for EVM transactions that are independent or have no common dependencies on each other. It identifies transactions within the linear ordering and executes it all in parallel without disruption to the outcome. Hereafter, all the transactions without common dependencies are scheduled in parallel on separate cores while transactions with common dependencies are scheduled back to back. This functionality allows Monad to process more transactions simultaneously and efficiently without disrupting the state.
Furthermore, All the dApps originally deployed on Ethereum and can leverage Monad to unlock hyper scalability. With this method, the developers of Monad claim that they can achieve over 10,000 TPS through pipelined execution and other innovations within their development.
Key-features of Monad
Monad offers several features that are proven to be successful from the perspective of a novel blockchain network. Followings are the key-features of Monad;
- 1 Second Block Time: The MonadBFT consensus enables 1 second block finality with transactions being finalized within seconds.
- Parallel Executions: While most of the EVM-based blockchain uses sequential executions, Monad employs parallel execution of transactions.
- High Throughout: The unwavering scalability of Monad enables high throughput with capability to achieve over 10,000 transactions per second.
- Optimized Operational Cost: The transaction and implementation cost on Monad is lowest compared to other leading blockchain.
The current State of Monad
Monad is currently in the development phase with its launching devnet in March 2024. It achieved over 10,000 TPS in the internal testing with an estimated block time of 1 second. The internal source claims that the Monad testnet is set to launch in Q3 2024 while the developers aim to launch mainnet at the end of 2024.
The team behind Monad has attracted massive investments including the latest raising of $225 million of funding in April. This funding round was led by the prominent crypto investment firm Paradigm and participation from Coinbase Ventures, Electric Capital, Castle Island Ventures and others. The team also raised $19 million from Dragonfly Capital following a $9 million pre-seed and $10 million seed funding round in 2022.
With the introduction of the next-generation of blockchain architecture, Monad is all set to make a long lasting impact on the blockchain industry. It is potentialized to become a hub for DeFi and smart contracts while having features like EVM-compatibility and robust scalability combined with numerous innovations. The interest shown by VCs during fundraising suggests that Monad could unlock a newer primitive within the crypto and decentralized application ecosystem.
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