Exclusive Interview with Fuel's Chief Growth Officer: Breaking the Modular Boundaries — All Chains Will Be Modular in the Future
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Exclusive Interview with Fuel's Chief Growth Officer: Breaking the Modular Boundaries — All Chains Will Be Modular in the Future
In a modular world, DeFi will become more accessible and efficient, with lightning-fast transaction speeds and low costs, promoting greater financial inclusion.
Navigating Web3 tides with focused insightsInterviewee: Arjun Kalsy, Chief Growth Officer at Fuel Labs
Interview & Article: Peng Sun, Pzai, Foresight News
"We expect that all future blockchains will adopt a modular design," said Arjun Kalsy, Chief Growth Officer of Fuel, when discussing the competition between monolithic and modular blockchains in an interview with Foresight News. Speaking about the Fuel team, he emphasized: "We aim to push the boundaries of modularity through our Rollup OS, master the execution layer, and bring back the best features from other Layer 1 ecosystems to Ethereum."
The development of the crypto ecosystem has been accompanied by explosive growth in users and interactions. Within existing monolithic Layer 1 architectures, bottlenecks in processing high-concurrency transactions have become increasingly apparent. Thus, throughout the evolution of the EVM ecosystem, discussions around scalability and efficiency improvements have persisted. When Vitalik proposed rollups as the core technological roadmap, the Fuel team became one of the earliest teams to deploy an Optimistic Rollup on mainnet. However, due to their unconventional decision to build the execution layer using the UTXO model, user adoption remained limited.
Subsequently, as the narrative around modularity gained momentum, the team began building their V2 version, positioning it as a modular execution layer. By combining the UTXO model with Sway—a programming language that inherits Rust's syntax while integrating features of Solidity—they innovated the Fuel VM, ultimately creating a Rollup OS optimized for maximum throughput and minimal latency. These innovations established Fuel as one of the standout scaling teams within the Ethereum ecosystem.
The background of the Fuel team is particularly interesting: co-founder John Adler is also a co-founder of Celestia, and CEO Chris Dodson was an early participant in the Ethereum ecosystem. Prior to joining Fuel Labs, Arjun Kalsy worked on ecosystem growth at Polygon and Mantle, where he helped build an ecosystem encompassing over 50,000 DApps. As an engineer, his passion has always centered on building infrastructure that solves core challenges in the blockchain space. Having spent years navigating the Ethereum ecosystem, he nowhopes that the Rollup OS can bring the best functionalities from other Layer 1s back into Ethereum.
Foresight News: Please briefly introduce yourself and your team. Why did you choose to join Fuel, and what was your experience in the crypto space before that?
Arjun Kalsy: Thank you for having me! Before joining Fuel Labs, I served as Head of Ecosystem at Mantle, and prior to that, I was Vice President of Growth at Polygon. At Polygon, I spearheaded partnerships with industry giants such as Reddit, Instagram, and Disney. I built both the Mantle and Polygon ecosystems from the ground up, bringing in more than 50,000 decentralized applications.
While I thoroughly enjoyed working on the business side, I see myself fundamentally as an engineer. My true passion lies in building and developing core blockchain infrastructure that addresses critical problems in the blockchain space. Both Polygon and Mantle have already carved out unique market positions, and I’m excited to reignite my deep desire to solve problems from scratch—starting from zero to one.
That’s precisely why I was drawn to Fuel Labs—the team behind Ethereum’s first Optimistic Rollup and the first to achieve two-phase decentralization with Fuel V1. We’re continuing to push boundaries with our Rollup OS, an operating system designed specifically for Ethereum rollups. Unlike traditional operating systems, Rollup OS tackles scalability through a different paradigm: minimizing state growth, mastering the execution layer, and bringing the best features from other Layer 1 ecosystems back to Ethereum. These core objectives drive our mission to transform the scalability landscape.
Foresight News: What motivated you to build Fuel, and what kind of product do you envision Fuel Labs becoming?
Arjun Kalsy: The motivation behind Fuel stems from two key observations about the Ethereum ecosystem. First, we share Ethereum’s vision of a programmable, decentralized world computer serving as a foundation for solving human coordination problems. Fuel aims to advance this vision by creating blockchain infrastructure that can be owned and operated by everyday users, paving the way for a fair and equitable digital economy. We believe that by addressing state growth and blockchain sustainability, Fuel can help build scalable and robust economies atop Ethereum’s decentralized trust layer.
Second, we recognize that while the rise of modular blockchains and Layer 2 solutions offers significant scalability advantages, they also introduce new challenges around fragmentation, interoperability, and cross-chain bridge risks. Existing blockchain architectures were not originally designed with this modular future in mind.
These insights led us to create an evolved version of the Ethereum Virtual Machine (EVM)—the Rollup OS. Our goal is to directly address these challenges and support Ethereum’s rollup-centric vision for a scalable future. Fuel integrates the best features of existing blockchains—such as state-minimized execution, UTXOs, parallelization, asset-oriented design, interoperability, and security—alongside native account abstraction and full wallet compatibility across the network.
Ultimately, we envision Fuel as the engine powering future blockchains secured by Ethereum. Our aim is to create a flexible and efficient infrastructure that adapts to the evolving needs of the blockchain ecosystem and fosters genuine human collaboration in the digital age.
Foresight News: How is the Fuel team structured, and how do teams collaborate?
Arjun Kalsy: The Fuel team is remote-first and globally distributed, with contributors located around the world. Similar to open-source projects, our structure empowers every contributor to think independently and encourages individual initiative to improve the organization. Over time, we’ve developed processes enabling teams to collaborate effectively across time zones and contribute meaningfully to project development. We value flexibility, adaptability, and innovation to stay ahead of emerging market trends. At the same time, we actively engage with the broader Ethereum ecosystem and immerse the Fuel community within this matrix, allowing us to develop original research and cutting-edge technical solutions aligned with our mission—advancing the entire blockchain industry.
Foresight News: Fuel raised $80 million in funding in 2022. What were the decisive factors behind that round? Are you planning another fundraising round?
Arjun Kalsy: Fuel’s supporters are long-term thinkers with deep expertise in blockchain technology. They understand the fundamental challenges facing the industry, and since our mission is to solve them, investors have strong confidence in the team’s ability to deliver. The Fuel team has already delivered the first two-phase Optimistic Rollup, proving its capability to build and deploy groundbreaking technology.
State growth remains an unresolved issue even after a decade of Ethereum’s existence. Achieving high performance while minimizing state growth has long plagued and challenged builders in the industry. Fuel successfully solved this problem, which is why the project is held in such high regard among industry builders and blockchain technology experts.
We currently have no plans for additional token sales and are set to launch our mainnet in Q4 this year.
Foresight News: What has been the biggest obstacle or difficulty Fuel has faced over the past few years?
Arjun Kalsy: Fuel Labs achieved significant progress in the Optimistic Rollup space thanks to its first-mover advantage. However, the journey hasn’t been without challenges. Learning from the limitations faced by Ethereum and other L1 blockchains, the team adopted a completely different approach—building a new virtual machine from scratch to achieve high performance and state minimization. The use of UTXOs enables high-throughput parallel transaction processing and allows flexible integration of new transaction types. Stateless primitives like predicates and scripts allow users to execute transactions without increasing blockchain state. Additionally, the team created Sway, a programming language perfectly suited for high-performance VMs. The result is an optimized Ethereum rollup operating system. It took the team three years to refine this architecture. Moreover, when we first launched in 2021, concepts like modular blockchains, execution layers, and state growth were still largely unfamiliar. Scalability solutions only recently began receiving the attention they deserve. Therefore, educating the market about the technical principles underpinning secure and scalable blockchain transactions remains an ongoing challenge. We’re actively cultivating a developer-friendly environment to bridge this knowledge gap.
Foresight News: What changes has Fuel undergone from V1 to V2? Why shift to an operating system-like “Rollup OS”? What interesting ideas and discussions emerged within the team during this process?
Arjun Kalsy: Since its inception, Fuel’s technology has made significant advancements between V1 and V2. While V1 achieved two-phase decentralization—a key milestone for Layer 2s—Fuel Labs has pushed further with Rollup OS by leveraging UTXOs, parallelization, and numerous other innovations. Rollup OS is designed to maximize throughput and minimize latency, enabling Fuel to utilize more CPU threads and cores—many of which remain idle in single-threaded blockchains. As a result, Fuel delivers greater computational power and state access compared to other blockchains.
Rollup OS also introduces groundbreaking optimizations to tackle state growth—the next major performance bottleneck.
Tokens are foundational in this industry, so we’ve focused on maintaining an asset-oriented design—meaning Fuel provides native support for Ethereum and other ecosystem assets. This significantly reduces interoperability risks and user complexity.
Today, the Fuel stack combines the virtual machine (Fuel VM), the programming language Sway, and the integrated toolchain Forc, forming a complete operating system for running rollups. We anticipate deploying multiple Fuel chains covering diverse use cases in the near future.
Foresight News: What are the advantages and characteristics of Fuel as a modular execution layer? What breakthroughs could Fuel bring to Ethereum’s mass adoption?
Arjun Kalsy: That’s an excellent question. Undoubtedly, our mainnet launch will demonstrate our scalability capabilities. But if I had to summarize it into three key points, they would be: state sustainability, high throughput, and superior user and developer experience.
Our strategy focuses on three pillars: relentless innovation by pushing the boundaries of what’s possible with FuelVM and Sway; nurturing a sustainable, diverse, and engaged community with comprehensive resources catering to all technical levels; and exploring new frontiers in DApp innovation. We’ve already fully integrated on-chain order books, NFT platforms, and ultra-fast random generators, and we look forward to building Fuel-native protocols at the forefront of DeFi, NFTs, gaming, DePIN, and beyond.
Foresight News: Why did you choose the UTXO model instead of Ethereum’s account model? What are the issues with mainstream account models today? Can the “stateless” UTXO model enhance Fuel’s capabilities? How difficult is it to integrate this UTXO model with the Ethereum ecosystem?
Arjun Kalsy: In account-based models, each transaction modifies the entire account state, which presents certain limitations in rollup environments. First, state management becomes highly complex. Tracking every change to account state can be cumbersome and computationally expensive, leading to scalability bottlenecks—especially in high-throughput settings like rollups. Second, concurrency issues severely hinder performance—particularly compared to parallelized blockchains—where conflicts and race conditions can lead to undesirable outcomes.
By adopting a UTXO-based model, we simplify the development process. UTXOs streamline state access, reduce contention in parallel processing, and expand the design space for developers to build new functions and applications using their unique properties. For example, UTXOs inherently offer better privacy, facilitating the development of privacy-centric solutions. Most importantly, Fuel’s UTXO design prevents transaction malleability—a critical vulnerability—enabling complex DeFi primitives like Uniswap to run smoothly on Fuel, something never before achieved on a UTXO chain.
Foresight News: What are the key features of Sway, the language developed by Fuel? It seems unfamiliar to most people—does it have a steep learning curve? How do you plan to build the Sway developer community, and how will you incentivize more Web2 and Web3 developers to build on Fuel?
Arjun Kalsy: Sway is a powerful and user-friendly programming language designed specifically for building smart contracts. Drawing inspiration from various languages, Sway offers a more intuitive feature set that enables builders to easily deliver high-performance code.
Here are some of Sway’s key features:
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Modern design for robust applications: Sway features a comprehensive type system suitable for a wide range of blockchain applications. This built-in structure helps developers write clearer, more maintainable code and reduces the likelihood of errors. Importantly, learning Sway enables you to build everything across the blockchain stack.
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Simplified development with tailored tools: Cutting-edge development tools work seamlessly with Sway. These tools streamline the development process, automate repetitive tasks, and reduce boilerplate code, allowing developers to focus on the core logic of their smart contracts.
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Security-first approach: Sway prioritizes security by offering strong static analysis capabilities. This helps enforce practices like the "Checks-Effects-Interactions (CEI)" pattern. By proactively identifying vulnerabilities, Sway helps developers build more secure smart contracts and reduces the risk of exploits.
Those familiar with Rust will find Sway accessible, as it incorporates Rust’s syntax and robustness while being designed to be easy to grasp for developers from other language backgrounds. Compared to Solidity, Sway offers a more advanced type system featuring traits, enums, and generics, making code more expressive and resilient.
On the other hand, while Sway inherits Rust’s emphasis on type safety and performance, it simplifies the memory model by eliminating the need to manage lifetimes—a potentially challenging concept. Sway further enhances the developer experience by incorporating blockchain-specific constructs designed to make smart contract development more intuitive. This combination makes Sway a powerful yet user-friendly option for building secure and scalable blockchain applications.
Fuel understands the need to attract developers from both Web2 and Web3 backgrounds. For Web3, Fuel focuses on interoperability with existing Ethereum tools and infrastructure, making it highly appealing to builders already familiar with the largest smart contract ecosystem. They can leverage their existing skills while exploring Fuel’s potential.
For Web2 developers, we’re creating a supportive learning environment with clear documentation, tutorials, and readily available assistance. This lowers the barrier to entry, making it easier for developers of all experience levels to learn Sway and build on Fuel.
Foresight News: What projects are currently in the Fuel ecosystem? Which types of projects are best suited for Fuel, and which sectors will the Fuel team prioritize supporting?
Arjun Kalsy: Current projects in the Fuel ecosystem include:
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Fluid Protocol: Fuel’s native decentralized stablecoin, backed by a fixed minimum collateral ratio (CR) of 135%. Fluid Protocol is also the first liquidity-inspired protocol to support partial liquidations.
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Bako Safe: A multisig wallet built specifically for the Fuel network. It offers a robust and user-friendly solution for managing crypto assets on Fuel, featuring enhanced security capabilities.
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Kassiopea: A decentralized perpetual trading platform built on Fuel, enabling users to trade commodities, real-world assets (RWA), and cryptocurrencies.
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Zap: A key infrastructure project in the Fuel ecosystem. Zap acts as a bridge, allowing existing Web3 and DeFi applications built on Ethereum to interact seamlessly with Fuel’s high-speed, low-cost Layer 2. These applications can unlock Fuel’s scalability and cost-efficiency benefits without major code modifications.
Foresight News: What is Fuel’s current market strategy, and which regional markets are you focusing on? During the current bull market, the Asia-Pacific region has attracted significant attention from project owners and investors. Does your partnership with OpenBuild indicate greater optimism toward the APAC market?
Arjun Kalsy: At Fuel Labs, we maintain a global perspective in our market strategy. Blockchain is inherently decentralized, with transformative potential across industries worldwide, and we are committed to driving adoption across different regions.
Certainly, Asia stands out as a key market due to its high cryptocurrency penetration and user adoption rates, making it fertile ground for innovative blockchain solutions like Fuel. Additionally, Asia leads in the Play-to-Earn gaming space—from Web3-native players like Axie Infinity and The Sandbox to Web2 giants like Nexon, Square Enix, and Sony—highlighting strong regional interest in integrating blockchain into gaming. This presents a significant opportunity, as gaming is highly compute-intensive and requires fast, precise technology to render pixel- and byte-level interactions in real time.
The growing number of prominent crypto conferences hosted in Asia underscores the region’s rising importance in the global blockchain landscape. This trend reflects market maturity and a strong appetite for staying at the forefront of technological innovation. We’re eager to work closely with teams passionate about building Web3 communities in Asia. We believe OpenBuild aligns with our values, and we’ll continue collaborating to help more people understand the unique challenges of blockchain execution and Fuel’s role in addressing them.
Foresight News: What is Fuel’s roadmap and future plans? What is the timeline for the mainnet launch? And what challenges must Fuel overcome in the medium to long term?
Arjun Kalsy: We have a lot of work underway for the remainder of this year, sending a strong signal that we’re ready to reshape the scalability landscape. We’ll soon share more news and market-leading features.
For me, the top priority is fostering a thriving ecosystem from both developer and user perspectives. We’re implementing an ecosystem strategy by defining clear project pathways within the Fuel ecosystem, providing developers, builders, and entrepreneurs with a roadmap to grow and evolve on Fuel. This includes incentive programs and grants to provide the best resources needed for developers to build the DApps of their dreams. By facilitating collaboration between founders and established projects through our network, we give founders a larger stage to increase market visibility and resource access.
At its core, Fuel Labs’ long-term success depends on achieving strong technical excellence. This includes a smooth and stable mainnet launch to build user trust, demonstrating scalability and user adoption to compete with existing players, and maintaining the highest security standards to prevent vulnerabilities.
From a macro perspective, Fuel aims to address the sustainability of blockchain technology through the lens of state growth. Driven by consistent curiosity, we must keep challenging the status quo to ensure blockchains remain relevant and essential in everyday life. This isn’t just about achieving mass adoption—it’s about taking the necessary steps to get there. First, any blockchain designed today, whether a rollup or not, will eventually be constrained by state bloat if it lacks a strategy to manage state growth, regardless of its execution or data environment. Second, crypto has yet to discover the “killer app” that will attract the next billion users. We’re tackling this by pioneering state-minimization technology and growing our innovation ecosystem through breakthrough applications enabled by Fuel.
Foresight News: Beyond Ethereum, does Fuel, based on the UTXO model, consider deeper integration with the BTC ecosystem? Could modular design empower more public chain ecosystems?
Arjun Kalsy: The UTXO model is highly flexible and can handle different asset types more easily. Moreover, all assets are native on the Fuel Network, making it simple to build for various asset types.
Foresight News: Many, including the Ethereum Foundation, believe ZK is the endgame. As builders of the first Optimistic Rollup, how do you view the relationship between OP Rollups and ZK Rollups? If ZK is indeed the endgame, how will Fuel respond?
Arjun Kalsy: While ZK technology is indeed promising, the relationship between Optimistic Rollups and ZK Rollups is more nuanced than simply declaring one approach the “endgame.” As builders of the first Optimistic Rollup (OR), we recognize the strengths of both approaches.
ORs have proven their reliability and efficiency over the past two years, handling massive liquidity flows without major incidents. They currently offer battle-tested solutions for various applications—including DeFi, NFTs, and gaming—while maintaining high performance and low gas fees. Furthermore, our research indicates that fast finality via ORs is achievable without compromising security. That said, we don’t overlook the potential of ZK technology. Since ZK solutions emerged, we’ve been actively researching and testing them. The rapid advancement of zkEVM technology is exciting, though still in its early stages.
Our approach is to remain adaptive and continuously innovate. We’re committed to updating and optimizing our tech stack to support a broad range of use cases. When the time is right and ZK technology matures sufficiently, our stack can seamlessly integrate ZK provers, transforming our chain into a ZK Rollup. Ultimately, our goal is to create the solution that best meets the needs of the blockchain ecosystem—whether that involves Optimistic Rollups, ZK Rollups, or hybrid models.
Foresight News: Why are you so optimistic about modular blockchains? What will the future competition between monolithic and modular blockchains look like? Can you describe the world that modular blockchains will enable?
Arjun Kalsy: Modular blockchains offer a solution to the scalability bottlenecks plaguing traditional monolithic blockchains. By decoupling core functions like consensus and execution into separate layers, Fuel achieves significant improvements in transaction processing. This paves the way for a future where blockchain is ready for mass adoption. Beyond scalability, modularity fosters innovation. For instance, Fuel leverages a UTXO-based execution layer, which offers distinct advantages over traditional account-based models. This opens up new design possibilities for developers building on Fuel, enabling novel applications that wouldn’t be feasible under the constraints of monolithic blockchains. Additionally, modular blockchains offer enhanced security potential. By isolating functions, a vulnerability in one layer is less likely to compromise the entire system, allowing for more targeted and robust security measures at each stage.
In the competition between monolithic and modular blockchains, monolithic chains will always be at a disadvantage because upgrading them becomes extremely challenging. In the fast-evolving Web3 world, where innovation occurs at breakneck speed, the ability to integrate or interface with new technologies is crucial. Modular chains can easily swap and upgrade components. We expect that all future blockchains will adopt modular designs.
In the future of modular blockchains, we envision DeFi becoming more accessible and efficient, with lightning-fast transactions and minimal costs, promoting greater financial inclusion. Blockchain gaming will evolve with seamless in-game economies and enhanced user experiences, thanks to faster processing speeds and lower fees. Supply chains will undergo revolutionary changes through specialized layers focused on data integrity and access control, improving transparency and security. The blockchain ecosystem will become more unified, with different chains communicating seamlessly, creating an interconnected landscape of specialized solutions.
Foresight News: The decoupling of Ethereum’s execution layer essentially refers to Layer 2s. As a modular execution layer, how do you see Fuel impacting and collaborating with existing L2s?
Arjun Kalsy: Fuel’s impact on the L2 landscape will be multifaceted. Our modular architecture enables specialization and flexibility—existing L2s may benefit from integrating components like our UTXO-based execution layer. Our focus on interoperability with Ethereum tools and infrastructure means developers can leverage Fuel’s capabilities without overhauling their applications.
We’re committed to fostering innovation across the entire L2 space. Our open-source philosophy and participation in standardization efforts can help establish best practices that benefit the broader ecosystem. Fuel’s unique features—like the Sway programming language and the UTXO model—are pushing the boundaries of what L2 solutions can achieve.
Ultimately, we believe that when the tide rises, all boats float higher. By collaborating with other L2 projects while offering unique advantages, Fuel aims to accelerate the adoption of L2 solutions and contribute to Ethereum’s long-term success. Our goal is to act as a catalyst for innovation, driving the entire ecosystem forward through cooperation and healthy competition.
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