Table of Contents
- 1. Background - Navigating the Ecosystem
- 1.1 The Convergence - Ethereum and Sei
- 1.2 DeFi, The Powerhouse of Sei
- 1.3 Other Notable Projects
- 1.4 Ecosystem Fund
- 2. Takeaway - Growing Ecosystem, and What’s Next?
- 2.1 TVL - Reached ATH
- 2.2 Top Projects by Data
- 2.3 Other Metrics - Tx, Users, etc
- 2.4 Concluding Thoughts - How Can Sei Stand Out in Competition?
- 3. Resource
Researcher
Related Projects
In May, Sei launched V2, introducing the first parallelized EVM into production. This major upgrade was implemented in three phases, ensuring thorough testing, network stability, and minimal risks. Sei V2's key features include: 390 ms block finality, EVM smart contract support with backward compatibility, SeiDB, and integration with Pyth price feeds and Entropy for real-time data and on-chain randomness.
These enhancements make Sei, a general-purpose L1 EVM, an ideal platform for various dapps, including high-frequency trading DeFi and gaming. Developers can easily transition from Ethereum and other blockchains to Sei's improved infrastructure.
Five months have passed since V2 went live. How is the ecosystem performing? Have metrics like TVL, user activity, and transaction volume increased?
In this article, we'll examine the current state of the Sei Ecosystem, highlighting both its strengths and areas for improvement.
Source: Sei Ecosystem
1. Background - Navigating the Ecosystem
As V2 upgrade adds EVM support, it made Sei a platform where dapps from other EVM-based blockchains can be easily deployed. This change has drawn a wide range of dapps to Sei, including DeFi, NFTs, and infrastructure projects. Also, Sei has a strong user and developer community which formed a cohesive community.
In this section, we'll explore Sei's ecosystem, covering:
Dapps from Ethereum
Leading DeFi projects
Established projects growing the Sei Ecosystem
The Sei Ecosystem Fund that is driving growth
1.1 The Convergence - Ethereum and Sei
As Sei V2 began supporting both CosmWasm and EVM, developers were able to deploy dapps and infrastructure from EVM-based blockchains onto the Sei Network. Sei's unique community and infrastructure, known for being one of the fastest blockchains, have attracted major Ethereum dapps. This integration has led to the deployment of several significant projects on Sei, including:
Uniswap: It is the most popular and known DEX in the crypto industry. It uses an automated market maker (AMM) model with liquidity pools for trading crypto. Currently active on the Sei Network, Uniswap has accumulated $3.7M in TVL. It is deployed as Oku.
Bancor and Carbon DeFi: Bancor is a decentralized liquidity network that enables automated, decentralized token exchange on Ethereum and across blockchains. It powers Carbon DeFi, which is an advanced DeFi protocol that enhances on-chain trading by offering various order types such as limit, range, and recurring orders. It allows users to implement automated trading strategies that are typically found in CEXs but have been challenging to execute in DEXs due to cost and complexity.
Vertex Edge: Vertex Edge is an advanced upgrade to the Vertex Protocol, a decentralized exchange (DEX) operating on the Arbitrum network. This upgrade introduces a custom parallel EVM implementation built in Rust, significantly enhancing the capabilities of the Vertex sequencer. Vertex Edge functions as a synchronous orderbook liquidity layer that aggregates and unifies liquidity across multiple blockchain ecosystems without segregating it. This allows for efficient and rapid cross-chain trading, with order matching times as quick as 5-15 milliseconds. The Vertex Edge upgrade enhances user experience by providing a seamless trading interface across different blockchains.
Opensea: Opensea is a leading marketplace for NFTs, where users can buy, sell, and discover digital assets. Its deployment on Sei allows for the exploration of new possibilities in NFT transactions, and onboarding new collections to Sei.
Elixir deUSD as fastUSD: Elixir deUSD is a stablecoin built with a basis trading strategy. With its strategy, the stablecoin provides high yields for the holders. This deUSD token serves as athe colalteral for fastUSD which is deployed in the Sei ecosystem.
Layerzero: LayerZero is an omnichain interoperability protocol designed to connect different blockchains seamlessly. By operating on Sei, LayerZero can enhance its cross-chain capabilities, offering users more efficient interoperability solutions.
1.2 DeFi, The Powerhouse of Sei
Sei has developed a robust DeFi ecosystem, introducing several innovative projects that enhance its blockchain capabilities. Below is an expanded explanation of the leading projects within this ecosystem.
Source: Sei - DefiLlama
Yei Finance (Lending): Yei Finance is a decentralized lending platform that allows users to borrow and lend digital assets. It offers a user-friendly interface and competitive interest rates, with additional Sei token incentives. By leveraging Sei's high-speed blockchain, Yei Finance ensures quick transaction finality and robust security, attracting a significant portion of the TVL in Sei's ecosystem.
DragonSwap (DEX): DragonSwap is a DEX that facilitates seamless trading of digital assets. It operates as an AMM, providing liquidity pools for various token pairs. DragonSwap benefits from Sei's rapid transaction processing and low latency, making it an attractive option for traders seeking efficient and cost-effective trading experiences.
Jellyverse (DEX): Jellyverse is another DEX within the Sei ecosystem, known for its community-driven approach. It provides a platform for users to trade a wide range of digital assets.
1.3 Other Notable Projects
Sei is a general-purpose and a high-performance blockchain platform designed to support dapps with a focus on scalability and efficiency. Also, Sei's ecosystem is home to several unique projects. Below is an introduction to some of these projects, all of which are exclusively built on Sei.
SiloStake (Liquid Staking): It is a liquid staking solution that incorporates MEV strategies. Liquid staking allows users to stake their assets while still maintaining liquidity, enabling them to participate in other financial activities. By integrating MEV, SiloStake aims to optimize returns for stakers by capturing additional value from transaction ordering and execution.
Pallet Exchange (NFT Marketplace): Pallet Exchange is the top NFT marketplace on Sei Network. It supports both cosmwasm and EVM, and has driven the adoption of NFT in the Sei Ecosystem.
Compass (Wallet): Compass is a crypto wallet built on Sei, offering users a secure and user-friendly way to manage their digital assets. The wallet supports a variety of cryptocurrencies and provides features such as transaction tracking, asset management, and integration with dapps on the Sei network. It supports both cosmwasm and EVM.
Seiyan, dob, The Colony, and More (NFT Collections): The Sei ecosystem hosts several unique NFT collections, including Seiyan, The Colony, Cappys, etc. These collections represent a diverse range of digital collectibles, each with its own community.
1.4 Ecosystem Fund
The Sei Network has established a significant Ecosystem Fund and Creator Fund to support the growth and development of projects within its ecosystem. This fund is designed to attract and incentivize developers to build on Sei Network by providing essential resources and support.
1.4.1 Sei Japan Ecosystem Fund
The Sei Japan Ecosystem Fund is a $50 million initiative launched by the Sei Foundation to support the crypto startup scene in Japan. This fund aims to accelerate the growth of startups within the Sei Network, particularly focusing on sectors such as Web3 gaming, social, and entertainment. The fund seeks to attract local talent and identify promising startups, providing them with the necessary resources to scale their operations.
1.4.2 Sei Creator Fund Supported by Gitcoin
The Sei Foundation has launched the Sei Creator Fund, a $10 million grants fund. This fund is specifically targeted at fostering the creation of new projects and the growth of existing NFT and social projects on the Sei platform. The Creator Fund aims to stimulate innovation and expand the ecosystem by providing financial support to creative and impactful projects.
These funds are part of Sei's broader strategy to enhance its ecosystem by attracting a diverse range of projects and developers, thereby increasing the utility and adoption of the Sei Network.
Sei also has recently launched Creator Fund Round #4 alongside its gaming competition, offering $250,000 in grants for Web3 gaming creators. This initiative aims to boost Sei's gaming ecosystem which has been one of the growth driver of the ecosystem.
Source: Sei Foundation partners with Gitcoin to announce $10M Creator Fund
2. Takeaway - Growing Ecosystem, and What’s Next?
2.1 TVL - Reached ATH
Source: Sei - TVL (USD)
2.2 Top Projects by Data
Source: Sei Top Projects
2.3 Other Metrics - Tx, Users, etc
2.3.1 Transaction Count
Source: Sei - Transaction Count
2.3.2 Daily Active Addresses
Source: Sei Network | Artemis Terminal
2.3.3 DEX Trading Volume
Source: Sei Network | Artemis Terminal
2.4 Concluding Thoughts - How Can Sei Stand Out in Competition?
The Sei ecosystem has seen a growth in user activity following the V2 upgrade, which introduced the first parallelized EVM. This upgrade has made Sei an attractive option for developers and dApps from Ethereum to deploy due to Sei's compatibility with existing Ethereum smart contracts, which allows developers to deploy their dapp on Sei without altering the code.
Sei is currently focused on growing its ecosystem through various initiatives, such as DeFi week and gaming competitions called Sei GG. The recent growth in the gaming sector is particularly noteworthy, with about 25 games either deployed or in the process of deploying on Sei. Several of these games have already attracted tens of thousands of users (unique wallets) and generated millions of transactions.
Despite these advancements, Sei has yet to see a dapp that fully leverages the capabilities of its parallelized EVM. While the technology promises enhanced performance and scalability, the ecosystem still lacks a standout application that can drive significant user engagement and growth. This gap presents both a challenge and an opportunity for developers to innovate and create dapps that can harness Sei's infra. However, recent launch of Vertex Edge is the project that could leverage the performant infra of Sei.
As similar high-performance blockchains enter the market, Sei will need to distinguish itself by fostering an ecosystem of applications that leverage its parallel processing capabilities to deliver better user experiences. Sei's success will depend on its ability to attract and support a diverse range of dapps that can showcase the potential of its parallelized EVM.
3. Resource
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