Parallel EVM: Beyond Serial, Breaking Through Blockchain Performance Bottlenecks

Performance has become a bottleneck for further development in the Blockchain industry. Blockchain networks create a new, decentralized trust foundation for individuals and businesses to conduct transactions.

The first generation of blockchain networks represented by Bitcoin pioneered a new model of decentralized electronic currency transactions through distributed ledger technology, revolutionizing a new era. The second generation of blockchain networks represented by Ethereum fully leverages imagination, proposing to achieve decentralized applications (dApp) through distributed state machines.

Since then, the Blockchain network has embarked on its own rapid development history spanning over a decade. From Web3 infrastructure to various sectors represented by DeFi, NFT, social networks, and GameFi, countless innovations in technology and business models have emerged. The booming development of the industry requires continually attracting new users to participate in the ecological construction of decentralized applications, which in turn raises higher demands on product experience.

As a "unprecedented" new product form, Web3 not only needs to innovate in meeting user needs (functional requirements) but also needs to consider how to balance security and performance (non-functional requirements). Since its inception, people have proposed various solutions in an attempt to address performance issues.

These solutions can be broadly divided into two categories: one category is on-chain scaling solutions, such as sharding and Directed Acyclic Graph (DAG); the other category is off-chain scaling solutions, such as Plasma, Lightning Network, sidechains, and Rollups. However, this is still far from keeping up with the rapid growth of on-chain transactions.

Especially after experiencing the DeFi Summer of 2020 and the continuous outbreak of inscriptions in the Bitcoin ecosystem at the end of 2023, the industry urgently needs new performance enhancement solutions to meet the requirements of "high performance, low fees." Parallel Blockchain was born in such a context.

Parallel EVM Narrative Overview

The parallel EVM narrative marks the formation of a competitive landscape of two powers contending in the parallel Blockchain field. Ethereum processes transactions in a serial manner, executing them one after another in order, resulting in low resource utilization. Changing the serial processing method to parallel processing would bring significant performance improvements.

Ethereum competitors such as Solana, Aptos, and Sui all come with parallel processing capabilities, and their ecosystems have developed quite well, with market capitalizations of 45 billion, 3.3 billion, and 1.9 billion USD respectively, forming a non-EVM parallel camp. In the face of challenges, the Ethereum ecosystem does not back down, stepping up to empower EVM, thus forming a parallel EVM camp.

Sei boldly claims in its v2 version upgrade proposal that it will become the "first parallel EVM Blockchain" with a current circulating market value of $2.1 billion, and there is potential for even greater development. Currently, the parallel EVM new public chain Monad, which is the hottest in marketing, is favored by capital and its potential should not be underestimated. Meanwhile, the L1 public chain Canto, with a market value of $170 million and its own free public infrastructure, has also announced its parallel EVM upgrade proposal.

In addition, a number of L2 projects that are still in the early stages are providing cross-ecosystem performance improvements by integrating the capabilities of multiple L1 chains. Apart from Neon, which has achieved a circulating market value of 69 million USD, other projects lack relevant data. It is believed that more L1 and L2 projects will join the parallel Blockchain battlefield in the future.

Not only does the parallel EVM narrative have significant market growth potential, but the parallel blockchain sector to which the parallel EVM narrative belongs also has substantial market growth potential, thus the market outlook is broad.

The current overall circulating market value of L1 and L2 is $752.123 billion, while the circulating market value of parallel Blockchains is $52.539 billion, accounting for only about 7%. Among them, the circulating market value of parallel EVM narrative-related projects is $2.339 billion, accounting for only 4% of the circulating market value of parallel Blockchains.

The parallel EVM narrative projects are mainly divided into monolithic blockchains and modular blockchains, with monolithic blockchains further divided into L1 and L2. From the total number of projects and the development of several major tracks, it can be seen that the ecosystems of various parallel EVM L1 public chains still have a lot of room for development compared to the Ethereum ecosystem.

The DeFi track demands "high speed and low fees", while the gaming track demands "strong real-time interaction". Both have certain requirements for execution speed. Parallel EVM will inevitably provide these projects with a better user experience, pushing the industry's development into a new stage.

L1 is a new public blockchain with built-in parallel execution capabilities, serving as a high-performance infrastructure. Among the projects in the L1 category, Sei v2, Monad, and Canto represent those that have designed their own parallel EVM, which is compatible with the Ethereum ecosystem and provides high-throughput transaction processing capabilities.

L2 provides scaling capabilities for cross-ecosystem collaboration by integrating the capabilities of other L1 chains, making it a prominent topic in rollups. Among L2 solutions, Neon is an EVM emulator on the Solana network, while Eclipse executes transactions on Solana but settles on EVM. Lumio is similar to Eclipse, except it replaces the execution layer with Aptos.

In addition to the aforementioned monolithic Blockchain solutions, Fuel has proposed its own modular Blockchain approach. In its second version, it will position itself as an Ethereum rollup operating system, offering more flexible and thorough modular execution capabilities.

Fuel focuses on executing transactions while outsourcing the rest to one or more independent layer Blockchains, allowing for a more flexible combination: it can be an L2, an L1, or even a sidechain or state channel. Currently, the Fuel ecosystem has 17 projects, primarily concentrated in the DeFi, NFT, and infrastructure sectors.

Parallel EVM Technology Principles

To achieve decentralized transaction execution, the blockchain network must fulfill 4 responsibilities:

• Execute: Execute and verify transactions
• Data Availability: Distributing new blocks to all nodes in the Blockchain network
• Consensus Mechanism: Verify Blocks, Reach Consensus
• Settlement: Finalizing and recording the status of transactions

Parallel EVM is mainly an optimization of the execution layer's performance. This is divided into two types: Layer 1 (L1) solutions and Layer 2 (L2) solutions. The L1 solution introduces a transaction parallel execution mechanism, allowing transactions to be executed in parallel as much as possible within the virtual machine. The L2 solution essentially utilizes the already parallelized L1 virtual machine to achieve a certain degree of "off-chain execution + on-chain settlement."

To understand the technical principles of the parallel EVM, we need to break it down: first, understand what a virtual machine is, and then understand what parallel execution is.

Virtual Machine

In computer science, a virtual machine refers to the virtualization or emulation of a computer system.

There are two types of virtual machines: one is called a system virtual machine, which can virtualize a physical machine into multiple machines, running multiple operating systems to improve resource utilization. The other is called a process virtual machine, which provides an abstraction for certain high-level programming languages, allowing programs written in these languages to run in a platform-independent manner on different platforms.

The JVM is a process virtual machine designed for the Java programming language. Programs written in Java are first compiled into Java bytecode (a type of binary code in an intermediate state), which is interpreted and executed by the JVM: the JVM sends the bytecode to the interpreter, which translates it into machine code for different machines, and then runs it on the machine.

The blockchain virtual machine is a type of process virtual machine. In the context of blockchain, the virtual machine refers to the virtualization of a distributed state machine, used to execute contracts in a distributed manner and run dApps. Similar to the JVM, the EVM is a process virtual machine designed for the Solidity language. Smart contracts are first compiled into opcode bytecode, which is then interpreted and executed by the EVM.

Emerging public chains outside of Ethereum are increasingly adopting virtual machines based on WASM or eBPF bytecode when implementing their own virtual machines. WASM is a small, fast-loading, portable bytecode format based on a sandboxed security mechanism. Developers can write smart contracts using various programming languages (such as C, C++, Rust, Go, Python, Java, and even TypeScript), then compile them into WASM bytecode for execution. The smart contracts executed on the Sei public chain use this bytecode format.

eBPF is the evolution of BPF (Berkeley Packet Filter), originally designed for efficient filtering of network packets, and has since evolved to provide a richer instruction set.

It is a revolutionary technology that allows dynamic intervention and modification of the operating system kernel's behavior without changing the source code. Later, this technology emerged from the kernel and developed into a user-space eBPF runtime, which has high performance, security, and portability. Smart contracts executed on Solana are compiled into eBPF bytecode and run on its Blockchain network.

In other L1 public chains, Aptos and Sui use the Move smart contract programming language, compiling it into unique bytecode that runs on the Move virtual machine. Monad, on the other hand, has designed its own virtual machine compatible with EVM opcode bytecode (Shanghai fork).

parallel execution

Parallel execution is a technology like this:

1. Able to leverage the advantages of multi-core processors to handle multiple tasks simultaneously, increasing system throughput;
2. Ensure that the transaction results obtained are exactly the same as when executing transactions in a strictly sequential manner.

Blockchain networks commonly use TPS (transactions per second) as a technical indicator to measure processing speed. The mechanism of parallel execution is relatively complex and also tests the technical level of developers, making it not easy to explain clearly. Let's start with an example of a "bank" to explain what parallel execution is.

First of all, what is serial execution?

Situation 1: If we consider the system as a bank and the CPU processing tasks as the counter, then executing tasks serially is like having only one counter in the bank to handle transactions. At this time, customers (tasks) coming to the bank can only line up in a long queue to conduct their transactions one by one. For each customer, the counter staff must repeat the same actions (executing instructions) to handle their transactions. When it's not their turn, customers can only wait, which results in an extended transaction time.

So what is parallel execution?

Situation 2: At this time, the bank saw a crowd, so they opened several more counters to handle business. With 4 tellers processing transactions at the same time, the speed increased by about 4 times compared to before, so the waiting time for customers was approximately reduced to 1/4 of the original, thus increasing the speed of business processing at the bank.

What error will occur if two people transfer money to another person at the same time without protection?

Scenario 3: Three people A, B, and C have 2 ETH, 1 ETH on their accounts respectively.