Why has chain abstraction become the hot narrative after modularization?

Author: Haotian Source: substack

Why has "chain abstraction" become another mainstream hot narrative after "modularization"? In addition to the seemingly "empty" goal of Mass Adoption, I think the real core reasons are as follows:

1) Chain abstraction is inevitable after modularization reaches a certain stage, because the blockchain technology architecture roughly includes the consensus layer, execution layer, DA layer, interoperability, settlement layer, etc. In the traditional sense, a monolithic single chain must coordinate the comprehensive strengthening of each layer, but modularization breaks this situation.

The DA layer, interoperability layer, and even the execution layer can be singled out for performance optimization and play a role in a composable collaborative way. Therefore, "modularization" has become the mainstream paradigm for developers to seek differentiation in chain construction. This low-cost and narrative-rich entrepreneurial methodology, which is not too worried about long-term problems such as ecological operations, has gradually become the mainstream.

However, modularization is essentially aimed at infra infrastructure. When excessive development power is too concentrated in the direction of modularization, it will cause an imbalance between infra and applications, leading to an embarrassing situation where infrastructure is more than applications.

Obviously, the emergence of "chain abstraction" is to break this embarrassing situation, reintegrate the blockchain components torn apart by modularization, improve the experience level, lower the threshold for users to onboard, and then promote the growth of applications. In a sense, chain abstraction will make up for the imbalance between ecology and applications brought about by modularization, and become an indispensable narrative in the next stage.

2) Chain abstraction itself is just a general concept, which can be roughly divided into three specific landing directions:

1. Providing tool services to promote the compatibility of heterogeneous chains, with the goal of seamlessly integrating different blockchain environments and increasing the application proportion of the service itself. For example, @chainlink's CCIP;

2. Unify the liquidity of the middle chain and become an aggregation dispatch center, mainly gathering decentralized assets on different chains, and use safer and more transparent cross-chain information transmission to build a unified liquidity layer (asset cross-chain, message transmission). For example, @0xPolygon's agglayer, @ProjectZKM's Entangled Rollup Network, etc.;

3. Adapt to various heterogeneous chains and launch a unified user interaction experience layer. On the basis of a series of tool or service compatibility adaptation, build a unified contract dispatch center, a decentralized solver service coordination center, and other unified gas payment, social login, social recovery and other user experiences, so as to lower the user's participation threshold and attract more users into the circle. For example, @NEARProtocol launched the BOS operating system, @dappOS_com launched the intent solver execution network for popular applications such as GMX, @ParticleNtwrk launched the full-chain account abstraction and intent fusion solution, etc. It should be said that some of these are more technical backend services, and some are more user front-end experience upgrades, all of which are to unify the decentralized blockchain single-chain environment and use full-chain seamless interaction and experience upgrades to expand incremental users to the blockchain application market. 3) The "chain abstraction" track is more likely to be favored by VCs and become the key to the integration of web2 and web3. At the beginning, Ethereum ERC4337 brought a wave of account abstract wallet development, mainly because a group of web2 Internet executives entered the market with financing. This is the easiest area for them to understand and use their expertise when they first enter web3. Chain abstraction further enriches the business scope on the basis of account abstraction, but it is still the main focus of some people with rich experience and background in web2.

Compared to the purely conceptual orientation of modularization, chain abstraction technology is more bottom-level, and the team needs to use real industry resource aggregation, asset TVL precipitation, and user data growth accumulation.

Compared to the modularization direction of commercial space that is often outlined with "xxxx as a service", VCs are more likely to give relatively objective valuations, and users can also see the value growth of the chain itself through objective data, thus having a better reference for investment valuation in the secondary market.