SEI Network is a relatively new solution that has appeared on the market. Due to its speed, it is becoming increasingly popular in the DeFi ecosystem. Granted, this AMM has dominated the decentralized finance space for a long time, but it is inherently less efficient. At this point, SEI has emerged as the solution to all problems.
What is the SEI Network?
It is a blockchain layer 1 that comes from the Cosmos ecosystem. It is still under development. It is also expected to serve as an advanced infrastructure for DeFi applications, especially those that use a natively integrated central limit order book (CLOB) for their operations.
SEI is expected to be a highly scalable, application-specific blockchain. It is expected to bring tremendous benefits to both developers and DeFi users.
Blockchain ecosystems are usually built on a single chain. As a result, developers are limited in how they can design a particular application. dApps have similar capabilities. In addition, they are usually not interoperable, i.e. they can only interact with apps built on the same chain.
SEI Networkis expected to be the solution to all these problems. It will be the first blockchain that is order-book oriented. As a Cosmos chain, it will have a set of validators that use the Tendermint consensus. As a result, SEI Network will be able to connect to more than 50 other inter-operational Tier 1s that use IBC. SEI is also expected to have built-in features such as a publicly accessible order book, price oracle and even front-running protection.
Developers building on SEI will also have access to a wide range of tools. This will allow them to customize their applications to meet specific needs. They are not limited to a single chain, nor do they have to develop their own to meet a particular application.
In summary, SEI Network will be the first layer for DeFi applications. The layer will have a built-in CLOB module that is fully optimized for speed, stability, and cost.
How does the SEI Network work?
SEI Network is supposed to be an app chain for DeFi based on the Cosmos SDK. However, unlike other app chains, it will have Layer 1 capabilities on which we can build different dApps. So the proposed solution is an intermediary between the appchain and the general Layer 1. Since the SEI Network is built with the Cosmos SDK, it optimizes the blockchain for DeFi functions. At the same time, it provides developers with an environment in which they can deploy different DeFi services so that they can easily interact with each other.
In addition, SEI Network is intended to be a powerful DeFi hub in the Cosmos system. It will thus allow other dApps to take full advantage of its features. So what makes the SEI Network different from other networks? Here are some of the features available:
- CosmWasm & IBC.
- Native order matching.
- Optimistic block production.
- Parallel execution of orders.
- Network prevents frontrunning.
- Combining of orders.
With these features, SEI Network can achieve high throughput and scalability.
SEI Network Ecosystem
The network is currently in the testnet phase. Therefore, little information has been revealed about the ecosystem of the network itself. However, if you read the official website, you already know that more than 70 dApps are being prepared for release through the SEI Network. Here’s what the SEI network ecosystem is all about:
- Vortex Protocol. It is a decentralized futures exchange based on an order book on the SEI network. It offers high liquidity for its order book, and allows leveraged trading of up to 10x. As the network uses IBC, it can support futures contracts for more than 35 different assets.
- Pharaoh Protocol. This is a decentralized synthetic exchange on the SEI Network. The available synthetic tokens in this group are meant to track the price of a specific cryptocurrency asset. Unfortunately, it has not yet been announced how this will work.
- Axelar Network. It is an app chain that serves as a bridge across the Cosmos ecosystem. The Axelar Network is designed to support cross-chain use of SEI networks.
- Synthr. It is also a cross-chain synthetic token protocol. It supports networks such as Ethereum, Aptos, Sui and SEI.
- KYVE. It is a decentralized data protocol that stores queries and organizes large amounts of data generated by SEI. The data thus collected by KYVE is then stored in Arweave, a permanent data storage protocol.
- White Whale. This is also a protocol, but its purpose is to solve the problem of fluidity of fragmented cross-chains in the Cosmos ecosystem.
- Multichain. This is a bridge protocol to improve the user experience of the SEI network for cross-chains. It works in a similar way to the Axelar network.
- Skip. The protocol aims to decentralize MEV in the Cosmos ecosystem. In addition, the protocol provides solutions to prevent frontrunning by supporting Transaction Relay.
- Kado. A company that takes care of the entire payment infrastructure in Web3. It offers an on-ramp function that converts cash to cryptocurrencies or an off-ramp function that converts cryptocurrencies to cash.
- UXD. This is a decentralized stablecoin protocol. It was first used on the Solana network. UXD issues stablecoins that are used as collateral.
- Nitro. This is an optimistic rollup. It uses the Solan virtual machine for its operation.
Summary
If SEI Network succeeds in this area, it will be the first and only player of its kind in the cryptocurrency market. At the same time, SEI is a much-needed addition to the Cosmos ecosystem. As more and more protocols are developed in Cosmos, we promise a bright future for SEI.
