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Will Algorand and Fantom Need Arweave’s Layer 0?

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As fast-by-design chains gain adoption and improve scalability, it’s inevitable they will run into the problem of making certain requirements too heavy for anything but an industrial/corporate node to fulfill. Storage, or proof of the full ledger of transactions, is one of these requirements.

The growth in blockchain size for Ethereum and Bitcoin over the last year has been relatively low compared to high-throughput chains like Algorand and Fantom.

While Ethereum has accumulated just over a terabyte of data since inception, Algorand’s capacity enables it to add 300TB in just one year, which will quickly drive the price of operating an archival node beyond the reach of many.

Like Solana, Algorand relies on nodes to keep a short record of history and offload the entire ledger elsewhere. In Solana’s case, the blockchain history is stored on Arweave, both via the SOLAR Bridge and KYVE.

As of May 2021, an archival node operator for Algorand reported the full ledger size as 766GB. At this scale, already twice the size of Bitcoin, Algorand will quickly ramp up in chain size as it reaches usage levels that add closer and closer to 1TB daily.

(sources: BTC, ETH, MOVR, AVAX, FTM, ATOM, ALGO, SOL)

This chart shows the potential transactions per second (TPS) of modern, performance-optimized L1s, with BTC and ETH for comparison. The bars in gray represent chains that already use Arweave for storage. TPS is a decent general metric of relative projected blockchain size – the faster it populates, the more there is to store.

To strengthen the case for AGLO and FTM’s eventual need to adopt a decentralized storage solution for its blockchain data, even chains like AVAX and MOVR – far below FTM and ALGO’s TPS – have invested in KYVE as a way to archive historical data.

In two recent Coinbureau videos, one covering FTM, one ALGO, Guy noted that both chains could benefit from using Arweave for storage. And, in recent weeks, we’re seeing more and more chains going this direction:

Solana’s original Arweave integration, the SOLAR Bridge, was actually fully centralized. Since then, KYVE has come in with similar functionality tied to a decentralized, proof-of-stake system. KYVE is currently archiving the blockchain history of Avalanche, Moonriver and Cosmos, with Solana on the way.

To fuel the adoption of Arweave as a layer 0, KYVE recently raised $2.8m from a combination of venture funds and blockchains which plan to use Arweave for storage, like Celo, Mina, Aurora and Moonriver.

We’re seeing more predictions that Arweave will be the default destination for blockchain data. Read the in-depth analysis of why Arweave and KYVE are ‘layer 0’ here.

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