What is Celestia?

Celestia is a modular data availability network that separates consensus and data availability from execution, providing greater scalability and flexibility for blockchain development.

By using data availability sampling (DAS), Celestia enables light nodes to verify block data without downloading everything, allowing the network to scale efficiently as more nodes participate. 

Unlike monolithic chains (e.g. Solana or Ethereum), Celestia's modular design allows blockchains and applications to rely on it for secure data availability, while handling their own execution, which improves scalability and reduces bottlenecks.

How Celestia Works

Celestia works by decoupling consensus, data availability, and execution into separate layers, allowing each to scale independently. This modular approach enables Celestia to focus solely on data availability and consensus, while other layers handle execution.

Here's how data availability works with Celestia:

• Consensus and Data Availability Layer: Celestia ensures that transaction data is available and ordered using Proof-of-Stake (PoS) to secure the network.
• Data Availability Sampling (DAS): Light nodes verify block data by sampling small portions, rather than downloading entire blocks, reducing bandwidth requirements.
• Namespaced Merkle Trees (NMTs): Data is organized into namespaces, allowing applications to retrieve only the data relevant to them.
• Two-Dimensional Reed-Solomon Encoding: This method enhances error detection and correction, ensuring robust data recovery even if parts of the data are missing or corrupted.
• Merkle Proofs: Light nodes use these to verify the integrity of data samples, ensuring data correctness and completeness.

What is Data Availability?

Data availability is the process of ensuring that all transaction data in a blockchain is publicly accessible and verifiable by network participants. It guarantees that nodes can confirm the presence and integrity of the data in a block without needing to download the full dataset.

In Celestia, this is done through data availability sampling (DAS), where nodes check small portions of data to verify the availability of the entire block, making the network more secure and scalable.

What Apps and Chains Use Celestia for DA?

To track which layer-2s, appchains, or DeFi apps are leveraging Celestia for data availability (DA), users can visit Rollup.wtf, a helpful tool that helps monitor the rollup ecosystem.

Some of the most popular protocols using Celestia for DA include:

• Ancient8, a layer-2 optimized for high-throughput gaming applications.
• Aevo, An order book-based decentralized exchange.
• Eclipse, An Ethereum-based Layer 2 using Solana for execution and Celestia for DA.

What are Blobs?

Blobs in Celestia are data chunks stored on the blockchain, made available through its data availability layer. These blobs hold transaction or application-specific data, organized into namespaces so apps can easily grab the data they need. 

Developers use PayForBlobs transactions to submit this data, ensuring it’s verifiable and accessible. This setup allows decentralized applications, like rollups or exchanges, to store and access only the data they need, keeping things as efficient as possible.

Celestia Tokenomics

Celestia’s tokenomics revolve around its native token, TIA, which plays a crucial role in the network’s operation and governance. Here's an overview of how it works:

• Total Supply: 1 billion TIA at genesis.
• Inflation: Starts at 8% in the first year, decreasing by 10% annually until it reaches a long-term floor of 1.5%.
• Use Cases: TIA is used to pay for data availability (blobspace), secure the network through staking, and participate in decentralized governance.
• Staking: Users can delegate TIA to validators and earn rewards, supporting the Proof-of-Stake consensus.
• Governance: TIA holders can vote on network proposals and manage the community pool, which receives 2% of block rewards for ecosystem initiatives.

This structure ensures TIA plays a central role in securing the network, enabling developers, and governing the Celestia ecosystem.

Bottom Line

Celestia simplifies blockchain scalability by separating consensus and data availability from execution, making it easier to build efficient, flexible blockchains.

Using tools like data availability sampling (DAS) and Namespaced Merkle Trees (NMTs), it ensures secure data while letting apps focus on execution and user experience. 

With the TIA token powering the blob market, governance and staking, developers can create scalable, independent blockchains & dapps, positioning Celestia as a key player in the future of decentralized applications.