SOVEREIGN ROLLUPS

Unlike a smart-contract roll-up that settles the entire block on an L1, the sovereign roll-ups use the L1s or other blockchains just for DA or Data Availability while handling consensus and settlement on their own layer.
In order to fully understand what a sovereign rollup is, we’ll need to first understand the different pieces of a blockchain:
🔺Data Availability and Consensus: makes sure data is available and that there is an agreed upon ordering of transactions (Celestia)
🔺Settlement: writes transaction data to the DA layer while publishing new state to the settlement layer. Settlement layers maintain state roots and is a place for dispute resolution and proof verification to take place
🔺Execution: processing transactions
Monolithic chains handle all three functions in one architecture. The modular stack scales horizontally by splitting up the three functions into different layers. A sovereign rollup is a rollup that has the scalability and security of a rollup but the sovereignty of an L1. A sovereign rollup does not need a smart contract layer. Instead, every transaction is published to the data availability layer and settled in another layer.
▫️BENEFITS OF SOVEREIGN ROLLUPS
• They can define their own rules of forking.
• Proof verification happens on the p2p network. Instead of validating proofs on the L1, proofs will be distributed among nodes.
a. In the optimistic case, a fraud proof is only distributed in the p2p network when there is a dispute.
b. In the zero knowledge case, a validity proof is distributed in the p2p network with each block.
• Ability to work independently of the Data Availability/Consensus Layer.
• Sovereign rollups can take advantage of the trust-minimized nature of settlement layers where tokens can easily be transferred between rollups and the settlement layer.