tl;dr Summary: Arbitrum Nova, the new chain built on AnyTrust technology, was introduced recently by Offchain Labs, the firm behind Ethereum’s largest scaling project, Arbitrum.
Arbitrum already enjoys the coveted top spot in the layer-1 scaling wars with over $2.87 billion in TVL (Total Value Locked) on its optimistic rollup.
On Aug 9, 2022, it took another step towards solidifying its top position by unveiling a new chain named Nova.
The new chain aims at social applications and gaming compared to the original Arbitrum One rollup, which will continue to be available for NFT and decentralized finance (DeFi) projects.
Arbitrum Nova is different from a rollup as it works on Arbitrum AnyTrust, a novel technology developed by Offchain Labs to reduce fees and speed up transactions, which is the biggest ask for social and gaming dApps.
AnyTrust chains, as opposed to optimistic rollups, are more centralized and thus less secure. Rollups, by design, inherit their security from the underlying layer-1, whereas an AnyTrust chain introduces its own security assumption, which results in a chain that is overall less secure than a rollup but faster.
Deep dive into AnyTrust
In a rollup, transaction data gets posted on the layer-1 chain. It guarantees that this data will be available to any of the miners/validators of layer-1 for validation, which means “inheriting” security from layer-1.
AnyTrust brings in these changes:
- Transaction data is not stored on layer-1 but off-chain.
- The new chain has a group of actors called the Data Availability Committee (DAC) that takes over validation.
- Unlike layer-1s, this committee requires a certain number of its members, to be honest. For layer-1s, it is just one.
Moving data availability—and in turn, the correctness of the chain—away from layer-1 means that transactions become cheaper and faster than even a rollup.
For example, a DAC can have 20 members, with the premise that at least two of them are truthful. This way, anything signed by a “quorum” of 19 committee members (mathematically calculated as N+1-K or 20+1-2) must be correct, which in turn means that it is safe to post the hash of this data instead of the full data on L-1.
The same is true for state transitions, which are the current snapshot of a blockchain. A state transition can now be accepted without waiting for the usual optimistic challenge period of seven days.
But what happens if there is no active quorum at any time? Does this mean that all transactions and state transitions halt? The answer is no.
The novel AnyTrust technology requires a working rollup system; in such a scenario, the chain will simply “fallback” to operate as a rollup.
In other words, this AnyTrust chain can seamlessly switch between “quorum” mode and “rollup” mode, depending on the presence of an active committee or not.
- Turbo/Quorum Mode: 19 out of 20 are honest and participating. This mode is the fastest and cheapest.
- Rollup Mode: 2 out of 20 are honest and participating; the chain falls back to the regular optimistic rollup mode.
- Failure Mode: 19 out of 20 are evil, which means a complete system breakdown.
Interestingly, this is not a new idea. As it turns out, this was the original Arbitrum design from 2018, which described a committee-based chain with a fallback mechanism to rollup.
It is vital to choose the right members of this DAC for projects interested in running their AnyTrust chain. In a tweet on Aug 9, 2022, Arbitrum Nova officially announced the members’ names in their DAC.
At the time of this article, Arbitrum Nova already has several dApps on its portal, including Reddit, FTX, and SushiSwap.
Arbitrum also plans to upgrade its current rollup called Arbitrum One to Nitro by the end of the month.
