Analysis: Why Sei Network is bringing a wave of disruption to Cosmos DeFi

The Cosmos DeFi tsunami came quickly.

Sei Network is building the first Layer 1 that optimizes transactions.

This article will explain why Sei can bring a wave of disruption inside and outside the Cosmos ecosystem?

First of all, what is Sei Network?

Sei is the first Layer 1 blockchain to support order book activity and transactions. Focus on maintaining a reliable, secure and high-throughput environment.

What problem is Sei trying to solve?

DEX is the most widely adopted application in the crypto space. Issues include: a "one size fits all" approach; network congestion preventing order book completion; slow performance in general.

Sei Network is changing the narrative from building a general-purpose chain to building a market-specific ecosystem.

Most L1s can be divided into two categories:

• Common (composable and coordinated): Sonala and Ethereum
• Application-specific (highly customizable/interoperable): dYdX and Osmosis

Sei Network is called a decentralized Nasdaq, its goal is to build a chain optimized for DeFi infrastructure, what exactly does this mean?

• Native order matching engine
• Twin-Turbo Consensus

Native order matching engine:

As an L1, it is able to provide DEX-specific customizable designs, such as building chain-specific order books.

The beauty of this is that it enables creative new products to be generated from within.

Dapps built on Sei Network will benefit from:

• Built-in order book
• fast execution
• Shared Liquidity Model

Twin-Turbo consensus:

Changes have been made to how blocks are propagated and processed for added functionality and optimization.

Let's analyze these two points and why they are important to Sei Network's mission.

• Smart Block Propagation
• Optimized block handling

Smart Block Propagation:

In the current setup, validators propose blocks, send hashes and blocks to other validators, which causes unnecessary waiting.

Sei changes this by allowing transaction hashes to be built locally, without waiting.

By removing inefficient waiting, Sei Network optimizes throughput by 40%.

Optimized block handling:

Currently, when a block is proposed, validators are waiting that length of time without actually processing the block.

Sei Network changes this by processing blocks at any given height.

Validators can process blocks in the pre-vote and pre-commit phases in parallel.

This change reduced latency and increased throughput by 33%.

These two changes are huge for building a scalable, fast and reliable DeFi central chain.

In comparison, Sei Network’s transaction confirmation finality is around 600 milliseconds.

Sei Network is not only the fastest blockchain, it is also designed to prevent MEV.

Rather than executing each block one-by-one, transactions can be aggregated (batched) at the end of each block and processed at the same price to prevent front-running.

This is the key to returning value to validators and the community.

This is why Sei Network has partnered with Skip Protocol to further maximize the efficiency of the existing market.

The building of Sei Network has attracted attention, leading to a surge in its announced partnerships.

Fourteen have been officially announced, with more to come...

Here are some of the most exciting applications deployed on Sei Network so far:

Vortex Protocol that provides IBC interoperable perpetual contract transactions.

Recently announced UXD, a fully supported decentralized stablecoin.

Pharaoh Protocol enables synthetic asset trading on SEI, which will leverage Sei's composability to enable a new approach to commodity trading.

Axelar Network enables cross-chain liquidity into Cosmos, which will make it easier for Sei Network to obtain liquidity outside of Cosmos. Think USDC and DAI that you want to cash out.

White Whale will create opportunities for users to arbitrage from SEI's order book.

Finally, one of the most important developments comes from an external ecosystem chain.

Nitro is Solana's first Layer 2 scaling solution and a gateway between Solana and Cosmos. This opens up a liquidity universe for the SEI community.

It's not just the community that's excited about building Sei Network, as they continue to grow their new but rapidly expanding ecosystem, some well-known institutions are also supporting Sei : Multicoin Capital, Delphi Digital, MEXC Global.

The essence of technology has been consolidated in continuous innovation, and better applications will drive better infrastructure.

Sei Network is creating a better infrastructure for the applications that need it and the users who need it.

SEI is bringing a wave of disruption to Cosmos DeFi.