Sei Network Unpacked: Testing the New Layer 1 Ahead of Its Token Airdrop

Sei Community is a DeFi-focused Layer 1 blockchain constructed on Cosmos. It’ll embody primary primitives equivalent to an order-matching engine and a unified liquidity mannequin, enabling sooner and simpler software improvement than on general-purpose blockchains like Ethereum. The mission is backed by trade heavyweights like Multicoin Capital, Coinbase Ventures, Delphi Digital, and GSR Ventures.

A New DeFi-Centered Layer 1

A brand new Layer 1 is coming to Cosmos, and there’s nonetheless time to check it earlier than its mainnet launch.

Sei’s crew says it desires to develop a “decentralized Nasdaq.” The thought is to allow the creation of monetary functions that may use the platform’s native order book-based decentralized alternate.

This isn’t the primary time crypto tasks have experimented with a network-wide order-book alternate. Solana had an identical plan with its flagship DeFi protocol, Serum. The Solana-based order e book alternate gives liquidity and token swaps for different DeFi functions within the Solana ecosystem. Initiatives like Mango Markets, Zeta, Solend, and Raydium use Serum as the bottom layer for operating functions on Solana.

Solana’s DeFi ecosystem topped $10 billion in whole worth locked in late 2021, however its utilization has plummeted because of the continuing crypto winter, frequent outages and hacks, and the collapse of the Solana-affiliated FTX alternate. 

Nevertheless, Sei Community will differ from Solana in a number of methods.

First, it is going to solely facilitate DeFi transactions, which means different functions in niches like NFTs and gaming gained’t clog the community. Second, as an alternative of utilizing a brand new consensus mechanism to enhance throughput, Sei’s crew makes use of the tried and examined Cosmos Software program Growth Equipment, which ought to lead to extra stability and fewer downtime than Solana. 

Sei’s Semi-Decentralization

To realize the transaction speeds required to run a decentralized equal of New York’s quantity two inventory alternate, Sei wants to supply swift execution occasions within the order of microseconds (1 second = 10^6 µs). This requires some trade-offs in decentralization. Most notably, Sei will run a restricted variety of validators. It plans to launch with simply 50 validators on mainnet, making it one of many world’s most centralized blockchains. For comparability, BNB Chain, a Binance-run community broadly criticized for its lack of decentralization, has 41 validators.

Nevertheless, Sei would be the quickest Cosmos SDK chain if it achieves its goal of 300 to 400-millisecond transactions. The crew has tweaked the essential Cosmos SDK design, which often gives execution speeds of two to a few seconds, by implementing optimistic block manufacturing and parallel order execution.

Furthermore, ecosystem improvement on Sei won’t be permissionless like on Ethereum as a result of functions that need to construct on it must be accredited by governance. This might inhibit revolutionary tasks within the vein of OlympusDAO from showing on Sei. Nevertheless, it is going to allow a extra optimized atmosphere for the ecosystem’s managers. It’s anticipated that the founding crew will solely make governance choices when it launches however will ultimately transition to a decentralized course of by handing off decision-making to SEI token holders.

Methods to Earn From Sei Community

The Sei Community mainnet launch is deliberate for the tip of 2022. Nevertheless, as is typical of improvement schedules, the launch could possibly be topic to delays. The crew has already begun neighborhood improvement initiatives by operating an incentivized testnet since July 2022. The Sei crew has said that testnet contributors will obtain 1% of the entire provide of SEI tokens.

The early testnet missions, equivalent to establishing a Sei validator node, have in depth {hardware} necessities equivalent to 32GB RAM. Nevertheless, a number of the more moderen missions, equivalent to testing Sei’s first futures trading platform, are extra accessible. You will discover our testnet information for getting concerned within the anticipated SEI token airdrop through SIMETRI.

In conclusion, Sei Community is a promising mission with first rate backing and technological design. Whereas there are some centralizing components, these are compromises to make sure stability, pace, and excessive throughput. It stays to be seen whether or not Sei will reside as much as its expectations when it comes to efficiency as soon as it launches. Regardless, Sei’s greatest problem could grow to be growing an lively DeFi ecosystem outdoors Ethereum amid a grueling bear market.

Disclosure: On the time of writing, the creator of this piece owned BTC, ETH, and a number of other different crypto belongings.