Sei Network: A Dual Narrative of High-Performance Layer 1 and Parallel EVM

Sei Network has started to explode after months of silence, with its token price continuing to rise sharply and reaching an all-time high. Currently, Sei's liquid staking has surpassed 3.5 million USD, and the network's TVL has exceeded 11 million USD. Sei is about to undergo an important V2 upgrade, enhancing parallel processing capabilities and introducing EVM. This article will analyze Sei Network's code, technical features, and ecological projects to help readers understand Sei and the potential opportunities within its ecosystem.

Sei Design Features

Sei, as a Layer 1 that supports order book activities and focuses on trading, provides a built-in Central Limit Order Book (CLOB) module. Developers can quickly launch and customize order book trading Dapps for spot, derivatives, options, and more using Sei's built-in order module, while Sei's parallelization design offers a fast, high-throughput network for its ecosystem applications.

Sei improves the processing speed of the blockchain network in the following ways:

1. Local Build Hash

Sei allows validators to send blocks to the network that only contain transaction hashes. Other validators, upon receiving them, will first construct the block based on the records in their local memory pool. If the memory pool does not have the corresponding transaction information, the validator will wait for subsequent blocks that include detailed transaction content to arrive for verification.

2. Parallel Transaction Processing

Sei Network reduces latency and increases throughput by having validators process pre-vote and pre-commit phases of blocks in parallel.

In the code implementation, Sei processes transactions either in parallel or sequentially. For multiple related transactions, Sei will process them sequentially; for unrelated transactions, it will process them in parallel.

Sei processes multiple transactions in parallel using Golang's goroutine. Currently, this design cannot handle a large number of transactions in parallel, so Sei V2 needs to continue upgrading in parallel processing.

Parallel EVM

What is a parallel EVM?

EVM is the virtual machine that processes smart contract-related transactions on Ethereum. To ensure network security, transactions on the EVM must be executed in order, which limits the performance of the related blockchain network.

The design of parallel EVM will allow different transactions in the EVM to be processed simultaneously, significantly improving processing speed and network throughput. The current solutions involve using high-performance new public chains compatible with EVM, such as Solana, Aptos, and Sei. Among them, Sei's parallel EVM has attracted the most market attention.

SeiV2 upgrade

Sei will implement parallel EVM in the upcoming V2 version launching in 2024, supporting the operation and interaction of Cosmwasm smart contracts and EVM smart contracts. Here are the key points of the Sei V2 upgrade:

1. Optimistic concurrency: Allows concurrent transaction processing, significantly improving throughput and efficiency.

2. EVM Compatible: Allows developers to deploy existing EVM smart contracts on Sei without changing the code.

3. Geth Compatibility: Sei nodes will integrate Geth to handle transactions of EVM smart contracts in the future network.

4. SeiDB: Improved storage layer that uses more efficient data structures and databases to reduce state bloat and enhance read/write performance.

5. Enhanced performance: With a block time of 390 milliseconds and rapid transaction processing capability with finality, as well as a high throughput of 28,300 batch transactions per second, and lower transaction costs.

The Sei v2 upgrade will integrate the advantages of Ethereum, aiming to provide a super-optimized execution layer that is fully compatible with the existing EVM ecosystem, in order to attract more users and developers into the Sei ecosystem.

Sei Contract Security Recommendations

If developers plan to build applications in the Sei ecosystem, they will use CosmWasm to build smart contracts. Developers are advised to follow the security practices below:

1. Be prepared to respond to attacks. Build scalable smart contracts and develop risk response plans.

2. Pay attention to the deserialization of the addr type. It is recommended to specify the type and perform validation after deserializing the addr.

3. Pay attention to calculations and overflow. Use CosmWasm's Uint256 and Uint512 types, and use the non-overflowing mathematical function full_mul().

4. Be aware of infinite loops. If there are data packets being transmitted between two CosmWasm contracts, be cautious as this may lead to infinite loops and consume a significant amount of gas fees.

Sei Ecosystem

1. Wallet

Currently, the wallets that specifically support the Sei network include Compass Wallet and Fin Wallet. There are already 14 wallets compatible with the Sei network, such as OKX Wallet and the previously Cosmos ecosystem-compatible wallets Keplr and Leap Wallet.

Security Advice:

• Avoid using wallet projects that are unaudited and have a short operational history.
• Pay attention to the safe storage of your mnemonic phrase and private keys.
• Check whether the transaction information is correct before signing the transaction.

2. Kryptonite

Kryptonite is the largest liquid staking protocol in the Sei ecosystem. Users can stake Sei tokens on its platform to earn stSei, with an annual yield of 5.54%; currently, users can also stake LP tokens of Seilor/Sei and stSei/SEIYAN to earn related token rewards.

Kryptonite will launch the kUSD stablecoin, allowing users to mint it by collateralizing assets such as Sei, BTC, and ETH, providing more liquidity for the Sei ecosystem.

3. YakaFinance

Yaka Finance is committed to building a multifunctional DEX, providing users with various DeFi services such as trading, liquidity mining, and Launchpad, with the goal of becoming the liquidity hub of the Sei ecosystem.

Yaka Finance is currently in the testnet phase and has launched an airdrop incentive program, attracting over 15,000 users to participate in its testing.

4. PalletExchange

Pallet Exchange is the NFT trading platform of the Sei ecosystem, currently reaching a daily trading volume of up to 1.23 million Sei (approximately 1 million USD). Pallet Exchange charges a 2% fee on NFT transactions on its platform to maintain the operation of the platform.

Currently, the NFT series that are attracting much attention in the Sei ecosystem include WeBump, The Colony, Seiyans, and Seinsei. As the Sei ecosystem is in its early development stage, users should be aware of the liquidity risks associated with these NFTs.

Summary

As a high-performance Layer 1 focused on trading, Sei has optimized the process of block generation and processing. Currently, Sei's ecosystem is growing rapidly, and the development of its ecosystem will create synergies with Sei. Various decentralized applications will continue to amplify Sei's high-performance advantages, while Sei will also attract more liquidity and users. With the continuation of the parallel EVM narrative, the upgrade to Sei V2 will address the current bottlenecks of Sei, attracting more market attention and more developers to the Sei ecosystem.