The First Principles of Blockchain: Taking Sui and Arweave AO as Examples

What is First Principle Thinking

First principle thinking refers to returning to the most basic conditions of things, breaking them down into their elements for deconstruction and analysis, thereby finding the optimal path to achieve goals. This principle originates from the ancient Greek philosopher Aristotle and has been popularized by Elon Musk. This principle also has similarities with the concept of "Dao" in Eastern philosophy.

In 2014, Elon Musk mentioned his first principle decision-making approach during his graduation speech at the USC Marshall School of Business:

"Maybe you've heard me say that you should think about problems from a physics perspective, which is first principle thinking. That is, don't rely on analogy. You break things down to the most fundamental truths and then reason up from there. This is a good way to determine if something makes sense. This kind of thinking is not easy; you can't think like this about everything, because it's very energy-consuming. But if you want to innovate, it's the best way to think. This framework was proposed and developed by physicists, who discovered counterintuitive things like quantum mechanics. So it's a very effective and powerful method. In any case, you should try to do it as much as possible."

Using the example of a vacuum capsule high-speed train, Musk explained that if one were to design a new train product using comparative thinking or experiential thinking, most people's ideas would focus on enhancing existing functions, making the power stronger, or improving fluid dynamics. However, if one analyzes product needs using first principles, it is necessary to return to the essential purpose of transportation: to transport a large amount of goods from point A to point B. This was the original purpose of creating trains and other transportation tools, and it does not necessarily have to be achieved through traction. Supported by first principles, Musk proposed using a magnetic levitation and low vacuum model to create a vacuum capsule high-speed train.

First Principles in Blockchain

So what are the first principles of blockchain?

Dr. Xiao Feng stated in his speech at the closing ceremony of the 2024 Hong Kong Web3 Carnival: The first principle of blockchain is a new method of bookkeeping.

"The blockchain that emerged in 2009, as a distributed ledger (DLT), records digital value and network value, and it is no longer recorded on private ledgers, but on a publicly transparent global public ledger, where everyone keeps accounts together, and all stakeholders keep accounts on one ledger. This is the first principle of blockchain: a transparent and public 'global public ledger.' All innovations in Web3 are based on this first principle."

The author agrees with Dr. Xiao Feng's viewpoint and further elaborates on the essence of blockchain based on this perspective.

The term "blockchain" can be broken down into block + chain. Since the first principle of blockchain is a method of bookkeeping, are blocks and chains really necessary?

Before answering this question, let’s first look at why Bitcoin, as a distributed ledger, needs blocks and chains.

In Bitcoin, a block is a digital record that contains a set of transaction information, which can be understood as a page in a ledger. A hash function can be used to calculate a hash value, which has the characteristic that if the content of the block changes slightly, the hash value will change. Each block contains the hash value of the previous block, which can be understood as the first line of block N+1 writing the hash calculated from block N, thus forming an immutable chain structure.

In Bitcoin, the mechanism for synchronizing the ledger is the PoW consensus mechanism. When transactions occur in the Bitcoin network, these transactions are placed in a memory pool (mempool). Miners then select a set of transactions from the memory pool and attempt to form a new block. To do this, miners need to find a specific value in a random number and combine this specific value with the block data to generate a hash value that meets the network difficulty target. This process is called "mining." The first to calculate a qualifying hash value gains the right to keep the ledger, which means mining is successful. The difficulty target is a dynamic value that adjusts every 2016 blocks (approximately every two weeks) to maintain an average block time of around 10 minutes.

Blocks and chains are the foundational structure of Bitcoin, and PoW is Bitcoin's consensus mechanism. The combination of the two achieves Bitcoin's decentralized bookkeeping function. However, from the essence of blockchain, as long as decentralized bookkeeping can be achieved, bookkeeping can be non-block-based (for example, single transaction consensus), and the ledger can also be a non-chain structure (for example, DAG). Therefore, blocks and chains are not necessary; they have simply become synonymous with decentralized ledgers represented by Bitcoin, Ethereum, and Solana.

After all, Bitcoin is a product from 2009. With the continuous development of blockchain research, although most blockchains still follow the traditional block + chain structure, some blockchains designed from first principles have emerged, starting from the fundamental issue of decentralized bookkeeping, featuring unique data structures and consensus mechanisms. This article takes Sui and Arweave AO as examples.

Sui: The Way of Water

Sui is a Layer 1 blockchain redesigned and built based on first principles, with a core team from Facebook's (now Meta) defunct Diem and Novi projects. The name Sui comes from the Japanese word for water, and its brand image reflects this influence.

Sui uses Sui Move to write its smart contracts, employing an object-based data model where all transactions take objects as input and produce new or modified objects as output, allowing independent objects to process transactions in parallel.

In Sui Move, each smart contract is a module composed of function and structure definitions. Structures are instantiated within functions and can be passed to other modules through function calls. The structure instances stored at runtime act as objects, and there are three different types of objects in Sui: owner objects, shared objects, and immutable objects.

Sui does not use blocks; it validates transactions individually, and whether a transaction undergoes Sui's ordering and consensus mechanism depends on whether the objects in the transaction are shared or non-shared.

If a transaction does not involve shared objects, it is called a simple transaction, and Sui employs a lightweight Byzantine Consistent Broadcast algorithm, referencing the design philosophy of FastPay. Clients broadcast transactions to all validators of Sui and collect validators' votes based on stake weighting to generate a certificate, which is then broadcast back to the validators. Validators that receive this certificate can directly execute the transaction.

If a transaction involves shared objects, it is called a complex transaction, and Sui uses the Narwhal & Bullshark consensus mechanism. Narwhal is a mempool module responsible for ensuring transaction availability. Narwhal operates based on rounds, with each round divided into two steps: transaction distribution (synchronizing transactions to other nodes) and transaction validation (collecting votes from other nodes on the transaction). After multiple rounds, transactions form a directed acyclic graph (DAG). Bullshark is a consensus module responsible for ordering the transactions in the DAG from Narwhal.

Sui utilizes DAG for transaction propagation and consensus, reducing transaction latency and minimizing network overhead during communication. Additionally, to maintain the integrity and order of historical information, Sui sorts transactions into checkpoints in a separate process, linking checkpoints linearly to provide a structure for storing and accessing historical data similar to traditional blockchains.

However, Sui's data structure is fundamentally different from traditional blockchains; transactions grouped into checkpoints in Sui are already finalized, while traditional blockchains group transactions that have not yet been finalized into blocks.

Arweave AO: The Way of Air

Water has no fixed shape, but it is still tangible. Just as Sui retains the consensus mechanism from traditional blockchains and ultimately organizes transaction data into the traditional block + chain structure, AO completely overturns the traditional blockchain paradigm, with no blocks, no chains, and no consensus. Symbolically, AO is closer to the sky (Sora in Japanese) than water.

AO is a distributed, decentralized, actor-oriented computing system based on Arweave. Its first principle is not to build a decentralized ledger but to create a decentralized computing system, somewhat akin to the relationship between applications and operating systems.

A computing system can be broken down into storage, computation, and communication, all of which have very mature solutions in Web2, but the challenge lies in decentralization. One approach is to build a decentralized storage network, a decentralized computing network, and a decentralized communication network separately. This is essentially the idea proposed by Gavin Wood, co-founder of Ethereum, in 2014 regarding a trinity of decentralized technology architecture for computing, storage, and communication, where Ethereum (smart contracts) is responsible for decentralized computing, Swarm handles decentralized storage, and Whisper manages decentralized communication.

AO consists of three units:

• Messenger Unit: Responsible for message communication, passing messages to the computing unit and coordinating to compute output results;
• Scheduler Unit: Responsible for scheduling and message ordering, uploading messages to Arweave;
• Compute Unit: Responsible for processing computations and uploading results to Arweave.

A process on AO consists of a set of units, each of which can act as a horizontally scalable subnet, executing a large number of transactions simultaneously to achieve high-performance computing, but each unit is not a decentralized network. In fact, in the entire AO architecture, the only truly decentralized component is the underlying storage network, Arweave.

Processes on AO gain verifiability by uploading their holographic data to Arweave—because anyone can restore the process on AO through the holographic data. This is essentially a Storage Consensus Paradigm (SCP), meaning that as long as the storage is immutable, the transactions above are traceable, and regardless of where the application is computed, the same results will be obtained.

AO has no consensus mechanism, but through SCP, it separates the computing layer from the storage layer, ensuring that the storage layer is permanently decentralized while the computing layer maintains the traditional computing model. Therefore, the scalability of computing on AO has no type restrictions, allowing for blockchain ledger services centered around EVM, WASM, or Move virtual machines, and even enabling any existing Web2 service to be rebuilt as a decentralized version on AO.

Conclusion

First principle thinking involves examining the essence of things from a physics perspective and then designing upwards layer by layer from that essence. Although both Sui and Arweave AO are designed based on first principles, their differing essences have led to completely different architectures.

The essence of Sui is decentralized ledger services, comparable to high-performance Layer 1 solutions like Solana. Therefore, Sui has designed an object-oriented data model, dual consensus mechanisms, and transaction parallel execution based on state access to enhance scalability while reducing latency and costs, enabling developers to quickly and cost-effectively develop applications based on Sui Move smart contracts.

The essence of Arweave AO is a decentralized computing system, or decentralized cloud service, serving as the infrastructure for running ledger services. Thus, AO proposes SCP around the idea of a "verifiable distributed computing system," performing computations off-chain while storing data on-chain, achieving interconnection and collaboration of large-scale parallel computers. The user experience is almost identical to traditional cloud services, but behind it lies a decentralized computing system.