What is Sei Network?

Sei is a Layer 1 Proof-of-Stake blockchain that is optimized for trading and exchanges. The network aims to solve scalability and performance issues that may be holding back decentralized exchanges (DEXs) on general-purpose blockchains.

Utilizing innovations like their Twin Turbo consensus mechanism, Sei is able to offer sub-second finality and over 20,000 transactions per second. Sei also has a native order-matching engine built into the base layer to enable high-performance order book-based DEXs. By customizing for trading apps, Sei provides the speed, throughput, as well as additional features needed for the next generation of DEXs, NFT marketplaces, gaming, and other trading-focused applications.

What Problem does Sei Solve? 

Most decentralized exchanges today are built on general-purpose blockchains, which lack the scalability and the performance needed for a high-quality trading experience.

Issues with general-purpose blockchains include:

• Slow finality and block times
• Low transactions per second
• Front-running and MEV vulnerabilities
• High costs for frequent traders

These limitations make it difficult for DEXs to compete with centralized exchanges in areas like latency, throughput, and overall user experience.To solve these problems, Sei is optimizing its tech stack specifically for trading and exchange use cases. This allows DEXs on Sei to scale while retaining decentralization and security.

Use Cases

Sei aims to be the ideal network for any applications including:

• Decentralized exchanges (DEXs): Sei offers an ideal base layer for building decentralized exchanges of all types. Its speed, throughput, and order-matching engine allow DEXs to scale while retaining decentralization.
• NFT marketplaces: NFT trading involves frequent transactions like minting, bids, and sales. Sei’s performance makes it suitable for NFT marketplaces to manage high demand and usage without congestion. Features like native oracles also help build reliable pricing into NFT platforms.
• In-game token economies and exchanges: Many games feature in-game currencies, items, and other digital assets that players can trade. Sei provides the transactional capacity for games to have robust in-game marketplaces and exchange systems.
• Traditional finance apps like order books and matching engines: With order books and matching engines built-in at the base layer, Sei can power decentralized versions of traditional exchange infrastructure. This allows creating apps like stock exchanges and derivatives trading in a decentralized format on Sei.

Sei network’s high performance and purpose-built trading features make it a compelling option for developers building these types of applications. 

Broadly, any application involving transactions, marketplaces, in-app economies, or other trading activities can benefit from building on Sei’s purpose-built trading chain. The network is designed for any use case that requires rapidly exchanging assets.

Network Tokenomics 

The native token of the Sei ecosystem is SEI. It has utility purposes including:

• Paying transaction fees on the Sei blockchain
• Used for on-chain governance of the protocol
• Staking to help secure the network and earn rewards

There is total max supply of 10 billion SEI tokens. Sei has conducted various incentivized testnet programs to distribute SEI tokens to early adopters and developers.

Using Proof-of-Stake consensus allows SEI holders to stake their tokens, helping to secure the network while processing transactions and earning staking rewards in return.

SEI token staking specifics: 

• Percentage of total supply staked: 60%
• Compounding: Rewards do not automatically compound
• Reward frequency: Distributed every block (~.37 seconds)
• Unbonding period: 21 days
• Slashing penalties: The two main types of violations are double-signing and unavailability.

The current staking rewards rate (SRR) is around ~8.3%. Rewards come from both inflationary token emissions and fees. Sei aims to manage tokenomics carefully to incentivize security while preserving value.

The Team

Sei Network was founded in 2021 by Jeffrey Feng and Jayendra Jog. The team combines expertise in areas like distributed systems, cryptography, and finance. 

Investors include Jump Capital, Multicoin, Coinbase Ventures, and Flow Traders, helping Sei to raise over $30 million to fund development to date. Sei also announced a $120 million ecosystem fund to introduce liquidity and incentivize dApps to build on the chain, with a $50 million investment from venture firm Foresight, as well as prior contributions from GSR, Hudson River Trading, Delphi Digital and others.

Future Developments

Sei mainnet launched on August 16th and SEI token trading volume reached over $1 billion. 

The Sei Network roadmap includes continued enhancements to areas like interoperability, tooling, and integrations with other protocols. The team also has ambitious plans to become the leading base layer for the next generation of DEXes and crypto marketplaces.

Staking SEI with Figment 

If you are interested in staking SEI, Figment offers a host of services aimed at delivering safe and reliable staking rewards for your assets. 

Our 250+ institutional clients rely on Figment to provide best-in-class staking services including seamless and easy integrations, detailed rewards reporting, insights, double sign slashing, and downtime penalty coverage. Figment’s team has extensive Sei knowledge intended to help dive into the specifics such as rewards and staking information. Meet with us to learn more about Sei staking.

The information herein is being provided to you for general informational purposes only. It is not intended to be, nor should it be relied upon as, legal, business, or investment advice. Figment undertakes no obligation to update the information herein.