Modular Blockchain
A design where separate systems handle execution, settlement, consensus, and data publication instead of one chain doing everything.
A monolithic chain such as Bitcoin or Solana performs all of those functions itself, while a modular stack might have a rollup execute transactions, Ethereum settle disputes and hold assets, and a dedicated layer publish the data. The argument for splitting them is specialization: each layer can be optimized and capacity added without forcing every node to do more work. The costs are equally concrete, since every interface between layers is a place where assumptions and failure modes are added, liquidity and users are spread across more networks, and the total security of a position depends on the weakest layer it relies on. Frameworks such as the OP Stack and Arbitrum Orbit let teams launch chains that assemble these components from menus.
In practice
A rollup can execute transactions, settle to Ethereum, and publish its data to a separate availability layer, so three different systems back one user transaction.
The common misunderstanding
Modular is a set of trade-offs rather than an upgrade; separating layers adds interfaces and trust assumptions that a single integrated chain does not have.