Project Research丨Modular High-speed Execution Layer Fuel Research Report

Editor | Bowen@Web3CN.Pro

Table of contents

1. Project introduction

2. Project Vision

3. Features and advantages

4. Modular blockchain

• Consensus
• implement
• Data availability
• Settlement

2. FuelVM

3. Parallel transaction execution

4. Developer experience

5. Development history

6. Team background

7. Financing Information

8. Development achievements

9. Project development

• Sway language
• Beta-3 test network

2. Community situation

3. Ecological projects

4. Economic Model

5. Risks and opportunities

6. Related Links

1. Project Introduction

Fuel Network is Ethereum's expansion solution, which claims to be the fastest execution layer of the modular blockchain stack, providing the greatest security and the most flexible throughput for decentralized applications.

Following Celestia, Fuel is another protocol that emphasizes the concept of a modular blockchain. In fact, Fuel and Celestia have the same co-founder John Adler, who is also one of the earliest proposers of the Optimistic Rollup solution. Unlike Celestia, Fuel is positioned as a modular execution layer, while Celestia is optimized for data availability and ordering. It does not execute, but only deals with data availability and consensus.

2. Project vision

Fuel V1 was initially used as an L2 expansion solution for a single Ethereum, and it is also the first Optimistic Rollup on the Ethereum mainnet, which will be deployed at the end of 2020. However, pure L2 is severely restricted by the performance of the main network. Even if the execution layer is separated, it still cannot achieve the purpose of complete expansion. Fuel tries to optimize the base layer through a modular execution layer, and improve the execution status of L2 to truly achieve expansion.

3. Features and advantages

1. Modular blockchain

A regular blockchain requires the following parts to function: consensus, execution, data availability, and settlement.

• Consensus

Consensus is the mechanism by which nodes come to an agreement on which data on the blockchain can be verified as true and accurate. The consensus protocol determines how transactions are ordered and how new blocks are added to the chain.

• implement

The blockchain execution layer refers to the computing layer for transaction execution and state changes. Transaction execution includes checking the validity of transactions (e.g. verifying signatures and token balances), executing on-chain logic and computing state changes. A state change is when a full node updates a copy of the ledger to reflect new token transfers, smart contract code updates, and data storage.

• Data Availability

Data availability ensures that block proposers publish all transaction data for a block and that transaction data is available to other network participants. The blockchain enforces rules that require transaction data to be available. This means that block producers must publish data for each block for download and storage by network peers, which must be made available upon request.

• Settlement

The blockchain must ensure that transactions committed to the chain history are irreversible. To do this, the blockchain must be confident that the transactions are valid. Therefore, the settlement function requires the chain to verify transactions, verify proofs and arbitrate disputes.

A modular blockchain refers to a blockchain that completely outsources at least one of the four components of the execution layer, settlement layer, consensus layer, and data availability layer to an external chain. Modular blockchains are characterized by scalability, flexibility, and ease of building projects.

Fuel is the earliest Optimistic Rollup deployed on the Ethereum mainnet, and the V1 version will be launched on Ethereum at the end of 2020. It provides scalability by using a different execution model from EVM, namely UTXO-based highly parallelizable minimal execution system, supporting ETH and all ERC-20 tokens. However, because Fuel V1 has too few users and does not support smart contracts, it has not been welcomed by users since its launch.

So shortly after the launch of Fuel V1, Fuel Labs, the development team of Fuel, shifted all development focus to the V2 version and positioned it as a modular execution layer, which is a verifiable computing system designed for the modular blockchain stack.

2. FuelVM

The biggest feature of Fuel is that it adopts a new VM architecture, FuelVM, which has its tool chain and language. FuelVM draws features from WASM, EVM, and Solana's SeaLevel, and its most compelling potential is that it executes on a UTXO-based data model.

FuelVM aims to reduce the wasteful processing of traditional blockchain virtual machine architectures while increasing the potential design space for developers. Fuel adopts the UTXO data model, which is similar to Bitcoin, and the entire state is represented in the form of a UTXO set. The difference is that some UTXOs in Fuel V2 are token UTXOs, while others are contract UTXOs. Unlike token UTXO, contract UTXO has code, storage, and a unique contract ID in addition to balance and spending conditions.

3. Parallel transaction execution

Fuel uses a strict state access list in the form of the UTXO model, so it has the ability to execute transactions in parallel, and has advantages in terms of calculation, state access, and transaction throughput). Fuel is a blockchain based on the UTXO model. Its biggest advantage is that it can execute transactions in parallel, which is not available in many other blockchains. The core of the technology is to determine the part of the state that the transaction will modify through access lists, so as to achieve parallel execution.

4. Developer experience

Fuel uses its own domain-specific language, Sway, and the supporting toolchain, Forc, to provide a more powerful and smooth developer experience. The development environment retains the strengths of smart contract languages such as Solidity, while adopting paradigms introduced in the Rust tooling ecosystem and including syntax that leverages blockchain VMs. To solve the problem of state growth, FuelVM employs two kinds of procedures, scripts and predicates, to enhance Turing-complete smart contracts.

4. Development History

2019.10.24 Fuel Labs released the Ethereum scaling solution Fuel

2020.01.13 Fuel, an Ethereum sidechain based on Optimistic Rollup, is launched on the public testnet

2021.01.01 Ethereum Optimistic Rollup Expansion Solution Fuel Version 1.0 Launched on the Mainnet

2021.09.21 Fuel Labs received US$1.5 million in financing, led by CoinFund

2022.09.07 Fuel Labs completes $80 million in financing led by Blockchain Capital and others

2022.09.09 Fuel Labs launched the Fuel Beta-1 testnet, a modular execution layer

2022.11.16 Fuel Labs launched the modular execution layer Fuel Beta-2 test network

2023.03.21 Fuel Labs launched the Fuel Beta-3 test network of the modular execution layer, adding a P2P network and running full nodes simultaneously

5. Team background

With more than 60 engineers, Fuel Labs provides the Ethereum ecosystem with the blockchain with maximum security and the highest flexible throughput. The founders are Nick Dodson, Samuel Borin and John Adler. John Adler is also a co-founder of the Celestia Labs project and helped pioneer Optimistic Rollups while working as a blockchain researcher at Consensys. Dodson was an early Solidity developer on Ethereum. Emily Herbert is a computer scientist and Sway language expert at Fuel Labs.

6. Financing Information

On September 21, 2021, Fuel Labs announced that it has received US$1.5 million in financing. The investment company CoinFund led the investment, and Fenbushi Capital and Origin Capital participated in the investment.

On September 7, 2022, Fuel Labs announced the completion of $80 million in financing, led by Blockchain Capital and Stratos Technologies, with participation from Alameda Research, CoinFund, Bain Capital Crypto, TRGC, Maven 11 Capital, Blockwall, Spartan, Dialectic, and ZMT.

investor

VII. Development Achievements

1. Project Development

• Sway Language

Sway is a language for building smart contracts and applications on top of Fuel. It is mainly based on Rust, but retains the advantages of smart contract languages such as Solidity, and provides the toolkit Force.

Currently, Fuel Labs announced the Sway language upgrades to be implemented in 2023, including compiler optimization in terms of bytecode size, Sway will support more backends (EVM backends are already under development), and abstraction will be more economical , more applications will be migrated from Solidity/Vyper to Sway, improved reentrancy analysis at compiler level, etc.

• Beta-3 Testnet

On March 21, 2023, Fuel launched the third public testnet Beta-3. The new testnet added a P2P network and introduced the ability to run full nodes on Fuel simultaneously. Fuel stated that Beta-3 is not an incentivized testnet and there will be no direct rewards for participating in the network. Fuel plans to launch a full mainnet in 2023.

2. Community situation

• Twitter: 121,000
• Discord: 110,000 people, relatively active

3. Ecological projects

In addition to the official DEX SwaySwap, Fuel Network also has other ecological projects, including DeFi, NFT, infrastructure, NFT and other categories.

8. Economic Model

Currently, Fuel has not yet launched a token.

9. Risks and opportunities

Modular blockchain will be the trend of blockchain development in the future, and many cutting-edge projects have been born around the execution layer and data availability, which may lead the user experience of blockchain to a new level.

At present, Fuel has announced the launch of the grant program and the launch of the Beta-3 test network. It is expected that the main network will be launched soon, and users can interact on the test network.

For the interaction steps, please refer to the link below. The test uses the Fuel wallet (similar to Metamask), and you can receive test coins and participate in the interaction without risk.

10. Related Links

Fuel official website:

Fuel interaction tutorial:

Fuel wallet download address:

reference: