Sei, a blockchain purpose-built to address the unique challenges of decentralized exchanges (DEXes), has emerged as the fastest Layer 1 blockchain in the industry. Designed to optimize high-frequency and high-volume trading, it introduces cutting-edge features to tackle issues faced by traditional blockchains, such as slow transaction speeds, limited throughput, and inefficient trading processes.
Current blockchain platforms often struggle with scalability, causing bottlenecks for DEXes. These platforms process transactions too slowly to meet the demands of high-frequency traders, resulting in inefficiencies that hinder the growth of decentralized finance (DeFi) and other blockchain-based applications.
To address these pain points, Sei optimizes its network for rapid transaction processing. The blockchain not only boosts transaction speeds but also enhances overall performance, providing a robust solution for industries including NFT marketplaces, gaming, and DeFi applications.
Sei’s breakthrough innovations lie in its unique architecture, designed to streamline trading processes across sectors.
The Twin-Turbo Consensus mechanism, operating on a Proof of Stake (PoS) system, significantly reduces block confirmation times. While conventional blockchains often take several seconds to confirm transactions, Sei cuts this time down to under 400 milliseconds. This is achieved through two major enhancements:
By transmitting transaction identifiers instead of full details, Sei conserves bandwidth and accelerates data sharing, allowing the system to process transactions concurrently and speed up validation.
It also employs parallel processing to enhance transaction throughput. By leveraging a Directed Acyclic Graph (DAG), Sei ensures that multiple transactions can be processed simultaneously, avoiding conflicts and enabling more efficient order execution.
At its core, Sei integrates an order-matching engine directly into the blockchain, supporting both central limit order book (CLOB) and automated market maker (AMM) systems. This integration allows for atomic execution of transactions, improving the speed and efficiency of order matching.
Sei further optimizes the trading process by bundling orders at both the client and chain levels. It reduces gas costs by grouping orders across markets and minimizes latency during high-throughput periods, ensuring swift trade execution even under heavy demand.
Validators on the network act as price oracles to ensure accurate asset pricing. Validators propose exchange rates during short voting windows, and penalties are imposed for inaccurate data submissions, promoting reliability and transparency in pricing.
Building on its foundational success, Sei released Sei V2 in 2024, introducing backward compatibility with Ethereum-based systems and significantly enhancing blockchain performance. Key upgrades in Sei V2 include:
Seamless migration from Ethereum Sei V2 allows developers to easily migrate smart contracts from Ethereum to Sei without any code changes. This is facilitated through the use of Geth, enabling Ethereum transactions and contracts to function seamlessly on Sei’s network.
Optimistic parallelization: This method enables concurrent execution of native Sei, CosmWasm, and EVM (Ethereum Virtual Machine) transactions. By only re-executing transactions that affect the same state, Sei dramatically increases throughput during periods of high demand.
SeiDB: A new storage system that improves data access speed and reduces data size. It features a 60% reduction in active data size, a 1200% improvement in state synchronization speed, and a 90% slower rate of historical data growth. These improvements result in faster block commit times and more efficient transaction processing.
Interoperability: Sei V2 ensures seamless interaction between EVM and CosmWasm environments, allowing full compatibility with Ethereum tokens without needing wrapped assets. This opens the door to broader cross-platform functionality for developers.
With Sei V2, users now have two types of addresses for different blockchain ecosystems. The Ethereum-compatible address starts with “0x” and is designed for Ethereum-based activities, while the Sei address begins with “Sei” and is tailored for operations within Sei’s native blockchain.
Sei’s advancements are revolutionizing the blockchain industry, offering unmatched transaction speeds, scalability, and developer flexibility. By addressing the specific needs of decentralized exchanges and other blockchain-based applications, Sei is poised to become a dominant player in the decentralized finance and blockchain space.