An Introduction on SEI V2: Bringing Lightning Speed to the EVM Stack

The much-awaited Sei V2 is going live today.

The V2 governance proposal has been approved and is ready to go live.

This article introduces Sei V2 and the importance of transaction parallelization in making blockchains more scalable and solving the trade-offs of most EVM chains.

---

Need for Speed

The emergence of fast chains like SEI comes from the limitations of EVM networks in terms of:

• Transaction Caps

• High Gas Fees

Combined, those pose limits to the use cases possible on blockchains.

For instance, launching an on-chain game on Ethereum would be unthinkable, as it would be prohibitively expensive, and the chain is not fast enough to support in-game transactions.

Speed matters.

The deployment of SEI is enabled by new technological innovations in the sector.

In particular, SEI boasts unique features in the form of:

• Twin-Turbo Consensus

• Transaction Parallelization

Others that have taken a similar design approach include Solana, SUI, Aptos, and Monad.

Furthermore, the initial design of SEI is being completely revamped with the development of SEI V2, set to launch this week.

What does it mean for blockchains employing a parallel stack?

With attention in the sector being highly fragmented, is SEI undervalued considering the upcoming catalysts?

---

SEI V2

SEI mainnet launched in August 2023.

It is a POS protocol based on Tendermint on the Cosmos IBC stack.

Since its launch, SEI has:

1. Consistently had over 45 Transactions per Second, scoring higher than any other L1 or L2.

2. Consistent numbers of daily transactions (over 4m)
   

3. Finalized blocks at 390ms, making it the fastest chain in existence

4. Operated without outages or downtime
   

The deployment of V2 is fundamental to make SEI “The First Parallelized EVM Blockchain”. This update makes SEI code compatible with EVM and available to EVM developers.

These developers can benefit from EVM's tooling and compatibility while getting all the benefits of the SEI tech stack.

• It will be much easier to deploy established or new protocols on SEI: Devs will be able to deploy any EVM-compatible audited contract without making any changes.

• Allows “Optimistic Parallelization” (explained below): the current implementation of SEI requires developers to define the state used by smart contracts, adding friction. Instead, SEI V2 will optimistically run all transactions in parallel (assuming they are correct).
  
  In case of conflicts, the transactions will be isolated, tracked, and rerun:

  • Transactions touching different parts of storage will be rerun in parallel

  • Transactions touching the same state will be rerun sequentially

This will continue until all conflicts are solved.

• State Storage improvements with SeiDB: Faster, More Efficient Storage for Sei
  Improving over the previous vanilla database, making it efficient and reducing latency. 

SeiDB commits all transaction states in an asynchronous manner, ensuring commit latency will look constant regardless of how many transactions we are handling in a single block.

In SEI V2, the previous monolithic database is divided into 2 components, improving RPC node's latency, reducing the disk usage of data stored, and improving recovery in case of a network crash.

1. The State Commitment (SC) - This stores the active chain state data in a memory mapped Merkle tree, providing fast transaction state access and Merkle hashing

2. The State Store (SS) - Specifically designed and optimally tuned for full and archive nodes to serve historical queries 

Key improvements of SeiDB:

SeiDB is based on the ADR-065 by the Cosmos team. 

• Interoperability: in SEI V2 all transactions get initially processed as SEI transactions and then filtered and sent to the appropriate Virtual Machines and Chain Storage module, for a better development experience, which allows full EVM compatibility

The SEI V2 vision:

The launch of SEI V2 represents phase 2 of the roadmap.

In this phase, developers will be able to deploy EVM contracts, which will take place only a few days before the launch of V2 Beta.

Applications currently built on any EVM chain will be able to deploy on SEI.

Furthermore, the synergy between EVM and CosmWasm on Sei creates a dynamic environment where developers can utilize the best features of both worlds. Features such as Pointer Contracts and precompiled contracts facilitate seamless interactions between different execution environments, ensuring that applications can leverage the full spectrum of blockchain functionalities offered by both EVM and CosmWasm. This interoperability is pivotal in enhancing user and developer experiences, making Sei a versatile and powerful platform that stands out in the competitive blockchain landscape.

Currently, SEI offers much cheaper transaction costs and higher throughput than any comparable network.

---

The SEI Token

• Market Cap: $1.5b

• 10b Total Supply

• 8.74b Circulating Supply

• 5.93b bonded (67% supply locked)

The V2 catalyst is exciting from a value-added point of view, especially given that SEI will not suffer from additional selling pressure because there were no token unlocks before August 2024.

Source: Messari

What’s next?

Nonetheless, there are already a lot of projects building on SEI.

SEI has a current TVL of $27.85m.

Here are some notable mentions of building or launching soon:

• DEXs: Jellyverse, DragonSwap, Uniswap, Bancor, Vermillion

• Staking: Silo, FRAX, EtherFi, Diva (Nektar), Kryptonite

• NFT projects: Seiyans, Redmilio, Pallet, Webump

• Launchpads: Meme.trade, Sejin App, Fjord Finance

• Lending: Monna, YEI