July 31, 2023

Understanding Arbitrum's Nitro

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The domain of Ethereum L2 solutions is expanding at a significant pace and Arbitrum Nitro is one such prominent advancement. The Arbitrum technology stack developed by Offchain Labs aims to scale Ethereum by leveraging Optimistic Rollups. This technology enables rapid and affordable execution of smart contracts while ensuring the security and decentralization of the Ethereum network. 

Let's delve into the technical details of Arbitrum Nitro and how it achieves these feats.

An Introduction to Arbitrum Nitro

Arbitrum Nitro is an evolution of the Arbitrum Rollup, which drastically improves the performance and efficiency of the Arbitrum protocol. It achieves this through several new techniques and improvements to the structure of Arbitrum's core data, all while ensuring security.

Rollup Basics

Before exploring Nitro, we need to understand what a Rollup is. 

In essence, a Rollup is a L2 solution that executes transactions off-chain and posts the results to Ethereum (Layer 1). 

The Ethereum network does not need to perform these computations but merely verifies them, which significantly reduces the cost and increases the speed of transactions.

How Arbitrum Rollup Works

Arbitrum Rollup, the basis for Nitro, extends the concept of Rollups by introducing an "any-trust" model. 

Here, the execution of transactions is not dependent on a single validator or a subset of validators but can be verified by anyone participating in the network.

Each block produced by an Arbitrum chain, called an RBlock, is subject to validation by all validators on the network. Validators also have the opportunity to challenge incorrect blocks, further increasing the network's resilience and trustworthiness.

Understanding the Nitro Protocol

Arbitrum Nitro introduces various optimizations to the rollup protocol, resulting in considerable performance improvements.

Nitro's Virtual Machine (VM) Architecture

Arbitrum Nitro's Virtual Machine (VM) is the core component responsible for executing transactions. Unlike Ethereum, which uses a global state, Arbitrum's VM architecture uses a multi-VM model. Each VM has its state and runs independently from others, ensuring that the execution of one VM doesn't impact others.

Each VM is executed as a sequence of assertions, where an assertion is a claim about the execution of a number of steps within the VM. This allows the system to batch many steps of computation together, improving efficiency.

Execution and Data Availability

In Nitro, validators receive transactions from users and form them into Assertion-RBlocks (ARBlocks). They then execute these transactions and submit the ARBlocks to the Arbitrum chain.

The Nitro protocol introduces the concept of a speed limit, a parameter that determines the maximum rate at which the chain can make progress. This speed limit depends on the ability of validators to emulate the chain's execution and is essential for ensuring that validators have sufficient time to validate each RBlock and issue a timely challenge if required.

Optimized Data Structures

Arbitrum Nitro introduces improvements in the way data is stored and structured. This includes the use of Sequencer RBlocks (SRBlocks), which hold the inputs of user transactions but not the transaction outputs. This results in a drastic reduction in the amount of data required to be stored on-chain.

Additionally, Nitro uses a more compact and efficient data structure to represent the state of VMs. This structure, known as a "Reduced Ordered State Tree" (ROST), leads to substantial reductions in gas costs for block submission and increases the speed at which validators can process blocks.

Fee Structure

Fees in Arbitrum Nitro are similar to Ethereum, where users pay for two resources: L2 gas and L1 calldata. L2 gas is the computational effort required to execute the transaction, while L1 calldata covers the cost of posting the transaction's data on Ethereum.

Arbitrum employs an L2 basefee mechanism, similar to Ethereum's EIP-1559. This dynamic fee mechanism ensures the network remains sustainable by comparing gas usage against the chain's speed limit.

Embracing AnyTrust in Arbitrum Nitro

AnyTrust is a variant of Arbitrum Nitro that further lowers costs by accepting a mild trust assumption. AnyTrust assumes that at least two members of a Data Availability Committee (DAC) are honest, thereby ensuring the data required for the rollup protocol is available.

AnyTrust introduces new concepts such as Keysets, Data Availability Certificates (DACerts), and Data Availability Servers (DAS). Keysets specify the public keys of committee members and the number of signatures required for a DACert to be valid. DACerts provide proof of data availability and DAS are the servers run by committee members to store data and provide it on demand.

The AnyTrust mechanism allows the sequencer to post a data block on L1 either by posting the full data or by posting a DACert proving data availability. This flexibility in data posting formats contributes to AnyTrust's efficiency and resilience.

In conclusion

Arbitrum Nitro presents a compelling approach to scaling Ethereum by maintaining security and decentralization. Its sophisticated architecture and thoughtful optimizations bring immense promise to the evolution of Layer 2 solutions. As developers, understanding the intricacies of Arbitrum Nitro can open up new possibilities and paradigms in building efficient and scalable DApps on the Ethereum network.