What Is Sei? A Rapid EVM Compatible Network

What is Sei?

Sei Network emerges as an innovative blockchain platform constructed specifically for the needs of digital asset trading. By incorporating an Ethereum Virtual Machine that operates parallel processes, the network propels transaction efficiency, making major strides in decentralization and scalability.

A distinctive characteristic of Sei Network is the implementation of Optimistic Parallelization alongside refined storage mechanisms, launched with its second version, to push for even higher transaction speeds. SEI tokens maintain the blockchain’s functionality by servicing transaction fees, fueling governance procedures, and providing rewards within its ecosystem.

Key Takeaways

  • Sei Network is tailored for trading digital assets, featuring a parallelized EVM for enhanced transaction speed.
  • Its native SEI tokens serve multiple roles, including transaction costs and network governance.
  • The network’s robust ecosystem includes key applications and is backed by multiple prominent investors.

What Is The History of Sei?

The Sei network is a layer-1 blockchain protocol that was designed to facilitate high-throughput, Ethereum virtual machine compatibility1, and low-cost transactions for a wide range of decentralized applications (dApps), specifically focusing on the trading and finance sectors. It utilizes a Proof-of-Stake consensus mechanism and boasts a native cryptocurrency called SEI.

2021-2022: The Early Years

The concept of Sei was conceived in the early 2020s by a team of visionary blockchain enthusiasts who sought to create a more performant and scalable blockchain infrastructure. The team, led by Jeff Feng2, Co-founder and CEO of Sei Labs, embarked on a mission to develop a groundbreaking blockchain protocol that would address the limitations of existing blockchains.

In 2021, Sei Labs was officially established, marking the formalization of their vision. The team dedicated the year to meticulously designing and developing the Sei blockchain protocol, carefully selecting components and algorithms to optimize performance, security, and decentralization.

2022 witnessed Sei’s architecture taking shape. The team introduced their innovative Proof-of-Stake (PoS) consensus mechanism, ensuring network stability and scalability, while incorporating innovative features like delegated proof of stake (DPoS) to enhance decentralization and governance3.

2023 and Beyond

In January 2023, Sei Labs secured a significant $30 million funding round4, demonstrating the immense investor confidence in the project’s potential. This influx of capital enabled the team to accelerate their development efforts and expand their global reach.

April brought a momentous occasion as Sei’s mainnet went live, ushering in a new era for the project. The official launch of the network and its native token, SEI, opened the floodgates for a wave of innovation and adoption.

In September, Sei sealed a strategic partnership with Kraken, a leading cryptocurrency exchange, enabling SEI trading on the platform. This partnership opened up a gateway to a wider market, facilitating access to Sei for a global audience.

November brought another milestone as Sei announced the launch of its decentralized exchange (DEX), SeaSwap. This native platform facilitated seamless trading of SEI and other tokens within the Sei ecosystem, providing users with a convenient and secure trading experience.

How Does SEI Work and What are its use cases?

It features a unique consensus mechanism called Twin-Turbo Consensus, which combines the strengths of both PoS and DPoS consensus mechanisms.

Use Cases

  • Decentralized Exchanges (DEXs): Sei’s high transaction throughput and low fees make it ideal for running decentralized exchanges. DEXs on Sei can offer a more user-friendly and cost-effective trading experience than traditional centralized exchanges.
  • NFT Marketplaces: Sei’s fast and secure network can support the creation and trading of non-fungible tokens (NFTs). NFT marketplaces on Sei can offer a more efficient and user-friendly experience than those on other blockchains.
  • Financial applications: Sei’s scalability and security make it a suitable platform for building financial applications, such as lending protocols, stablecoins, and asset management platforms.

Consensus Mechanism

Sei’s consensus mechanism, Twin-Turbo Consensus, combines the strengths of both Proof-of-Stake (PoS) and Delegated Proof-of-Stake (DPoS) consensus mechanisms. PoS is a more energy-efficient consensus mechanism than Proof-of-Work (PoW), while DPoS is more scalable than PoS. Sei’s consensus mechanism aims to achieve the best of both worlds.

Here’s how Twin-Turbo Consensus works:

  1. Randomized Slot Selection: Each block in the Sei blockchain is assigned a random slot number. The slot selection process is randomized to prevent any particular node from having too much control over the network.
  2. Block Producer Selection: Nodes in the network are randomly selected to produce blocks. The probability of a node being selected is proportional to its stake in the network. This ensures that nodes with a larger stake in the network have more influence over the network.
  3. Block Verification: Once a block is produced, it is broadcast to the network and verified by other nodes. If the block is valid, it is added to the blockchain.
  4. Slashing: If a node misbehaves, its stake can be slashed. This helps to deter malicious behavior and maintain the security of the network.

Sei’s consensus mechanism is designed to be both scalable and secure. It is a promising new approach to blockchain consensus that has the potential to revolutionize the way blockchains are used.

BlockchainTransactional ThroughputTransactional FinalityFrontrunning preventionProcessing styleSybil Protection
Bitcoin10 tps60 minutesNoneSequentialProof of Work
Ethereum20 tps6 minutesNoneSequentialProof of Stake
Solana10,000 tps~2.5 secondsNoneParallelizedProof of Stake
Sei20,000 ops380 millisecondsFBAParallelizedProof of Stake
Sei network claims to be the fastest layer-1 on the market. Source: Sei.io

What Are The Tokenmics of SEI?

According to data from CoinGecko5, SEI has a total supply of 10 billion, of which around 24% of coins are already in circulation. SEI has a market capitalization of $1.7 billion, ranking it in the top 50 cryptos by capitalization. The next major unlock of SEI is expected to take place on the 15th of August, 20246.

Only 24% of the SEI supply has been unlocked.
Only 24% of the SEI supply has been unlocked. Source: CoinGecko

How Was SEI Traded Recently, and What Are The SEI Price Predictions?

SEI traded relatively flat throughout most of 2023 before rallying as the year came to a close. SEI surged from $0.25 in December to its all-time high of $0.8 in January7. The SEI bulls are hoping that the rally can continue and push above $1 for the first time in its history. Coincodex8 expects SEI to set a new all-time high in 2025 or 2026 and possibly push above $1. Changelly9 has set an average price target of $0.84 for the end of 2024 and sees it trading above $1 in 2025.

Remember that crypto prices are extremely volatile, and you should always do your own research before risking your capital. Nothing in this post should be considered as financial advice.

SEI has surged by over 190% in the past year.
SEI has surged by over 190% in the past year. Source: TradingView

Final Thoughts on SEI

Sei is a Layer 1 blockchain designed for trading digital assets. It aims to address the scalability issues of other blockchains by using a unique consensus mechanism called Twin-Turbo Consensus, which combines the strengths of both PoS and DPoS consensus mechanisms. Sei also offers high transaction throughput, low fees, and native frontrunning protection. It is a promising new platform for decentralized exchanges (DEXs), NFT marketplaces, and other financial applications. SEI has traded very positively in the past few months, but the massive supply still locked may concern some bulls in the long run.

Frequently Asked Questions

What is SEI?

Sei is a Layer 1 blockchain specifically designed for the exchange of digital assets. It aims to address the scalability issues of other blockchains by using a unique consensus mechanism called Twin-Turbo Consensus. Sei also offers high transaction throughput, low fees, and native frontrunning protection.

What are the benefits of using SEI?

Sei offers several benefits over other blockchains, including:

High transaction throughput: Sei can handle up to 20,000 transactions per second, which is significantly faster than most other blockchains.

Low fees: Sei’s fees are very low, making it a cost-effective option for trading digital assets.

Native frontrunning protection: Sei has a built-in mechanism to prevent frontrunning, which is a type of attack that can be used to profit from the order flow of other traders.

What are the potential applications of SEI?

Sei has the potential to revolutionize the way digital assets are traded and used. Its high transaction throughput, low fees, and native frontrunning protection make it a promising platform for decentralized exchanges (DEXs), NFT marketplaces, and other financial applications. Sei could also be used to develop new and innovative applications, such as decentralized derivatives markets and smart contracts for asset management.

Peter Barker

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Peter Barker

Peter is an experienced crypto content writer and a DeFi enthusiast with more than 3+ years of experience in the space. Previously a journalist and news editor at a leading European news sourcing agency.

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