LD Capital: Analysis of modular blockchain Celestia.

LD Capital

2023-12-01 16:38

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Original Title: "LD Capital: An Analysis of Modular Blockchain Celestia"

Original Author: Lisa, LD Capital

1. Project Introduction

Celestia is a modular blockchain project that focuses on data availability. Compared to a monolithic blockchain that independently handles execution, settlement, consensus, and data availability, a modular blockchain decouples these functions across multiple specialized layers. As part of a modular stack, similar to a Lego structure, this provides each module with greater flexibility and scalability. The foundational layer of Celestia consists of consensus and data availability, known as the DA layer by the project team.

Celestia is a POS blockchain based on CometBFT and Cosmos SDK. Its two key functions in the DA layer are data availability sampling (DAS) and Namespaced Merkle trees (NMT).

DAS enables light nodes to verify data availability without downloading the entire block. Light nodes cannot verify data availability by downloading only the block header, so Celestia uses a 2-dimensional Reed-Solomon encoding scheme to re-encode block data for DAS in light nodes. The principle of Data Availability Sampling (DAS) is to allow light nodes to randomly sample small portions of block data in multiple rounds. As light nodes complete more rounds of block data sampling, their confidence in data availability increases. Once the light node successfully reaches the predetermined confidence level (e.g. 99%), the data is considered available.

NMT makes the execution layer and settlement layer on Celestia only download transactions related to them. Celestia divides the data in the block into multiple namespaces, each corresponding to rollup applications built on Celestia. Each application only needs to download data related to itself to improve network efficiency.

二、融资信息

translates to

2. Financing Information

Three, Economic Model

TIA is the native token of Celestia, with a total circulation of 1 billion. The first-year inflation rate is 8%, which will decrease by 10% each year until the annual inflation rate drops to 1.5%.

(1) Use Case

1. Rollup developers need to pay for the use of Celestia DA with TIA.

2. Similar to Ethereum, the Rollup built on Celestia will use TIA as GAS fees;

3. Pledge;

4. Governance.

(2) Distribution and unlocking status.

On September 26, 2023, Celestia announced the launch of Genesis Drop. Eligible participants can claim up to 60 million TIA on October 17, 2023. One-third of the Genesis Drop, or 20 million TIA, will be distributed to 7,579 developers and researchers. The remaining two-thirds will be distributed to 576,653 on-chain addresses, with 20 million TIA awarded to the most active users of Ethereum Rollups, and 20 million TIA distributed to the stakers and relayers of Cosmos Hub and Osmosis.

On October 31, 2023, Celestia completed the deployment of its mainnet test version and distributed airdrops, marking the launch of its modular network. The initial circulation of tokens includes 25% for research and ecosystem development, and 100% for public distribution, totaling 26.7% (=26.8%*25%+20%). However, due to 12.6% of the public distribution being reserved for future initiatives, the actual circulation ratio is 14.1% (=26.7%-12.6%), corresponding to a circulation quantity of 141 million. Adding the inflationary part, this is consistent with the current circulation of 145 million TIA displayed on Coingecko.

Although the unlocking of TIA investors and other parts will have to wait for one year, there is still inflationary pressure on TIA. The 8% annual inflation rate is based on a total token supply of 1 billion, which means that the inflationary part will add 80 million tokens within one year, accounting for 56.7% of the initial circulation of 1.41 billion tokens. If this part of the tokens is roughly averaged, it may generate a potential selling pressure of $1.227 million per day (valued at $5.6 per token), which is an easily overlooked part.

Four, Spot Data

TIA was launched on multiple exchanges such as Binance and OK immediately after its debut. Within 10 days of its launch, it experienced slight fluctuations around $2.5, followed by a strong surge on November 11th, leading to a bullish trend with a peak of $7.4. The chip concentration price is around $2.47, followed by $5.9. Recently, trading volume has fallen back to the level of the initial consolidation phase. The current price is at the 0.618 Fibonacci retracement level. Binance's major account sold 187,000 TIA, while retail investors bought 100,000 TIA.

Five, Contract Data

OI/MC=13.6%

Since the price began to fall from the high level, both CVD and open interest have declined synchronously. The long-short position ratio and the long-short ratio of large accounts have both increased to above 1. The active buying and selling volume and number have slightly deviated.