CRYPTO 101 Episode 638: Layer 1 Sei's State of the Union

Hosts: Bryce Paul & Brendan Viehman
Guest: Jay Jo, Co-Founder of Sei Labs
Release Date: January 28, 2025

In Episode 638 of CRYPTO 101, hosts Bryce Paul and Brendan Viehman delve deep into the evolution, challenges, and future of Sei Labs, a prominent Layer 1 blockchain platform. Joining them is Jay Jo, co-founder of Sei Labs, who provides invaluable insights into the project's journey, technological advancements, and the broader crypto ecosystem.

1. Introduction to Sei Labs and Jay Jo's Journey

Bryce and Brendan kick off the episode by introducing Jay Jo, highlighting his extensive experience in the crypto space since 2012. Jay shares his personal journey, from his early exposure to crypto during the 2017 bull run to his professional tenure at Robinhood, where he witnessed pivotal moments like the GameStop saga.

Jay Jo [02:59]: “That was the kind of initial inspiration for us to be like, okay. This system where everything is super opaque, nothing's transparent... and turn off buys or something.”

2. The Genesis of Sei Labs

Jay Jo recounts the founding of Sei Labs, inspired by frustrations experienced while working at Robinhood. The unpredictability and lack of transparency during events like the GameStop short squeeze motivated him and his co-founder to build a more transparent, on-chain alternative.

Jay Jo [08:17]: “We started building something like Robinhood, except building it on chain.”

3. Challenges in Building a Layer 1 Blockchain

The conversation shifts to the technical and financial hurdles Sei Labs faced. From fundraising during tumultuous times like the Terra and FTX collapses to the initial struggle of attracting developers to their mainnet, Jay emphasizes the resilience required to navigate these challenges.

Jay Jo [18:27]: “Fundraising has been consistently one of the harder parts for us.”

4. Embracing EVM Compatibility

A significant turning point for Sei Labs was recognizing the dominance of the Ethereum Virtual Machine (EVM) among developers. This realization led to the development of SEI v2, the first paralyzed EVM, enhancing both performance and compatibility.

Jay Jo [14:56]: “We realized that the EVM is here to stay... the EVM is also much more than that. It's an entire ecosystem.”

5. SEI's Current Position and Community Growth

Despite being a relatively middle-tier project in the Layer 1 landscape, Sei Labs has made commendable progress. The introduction of SEI v2 revitalized community interest, leading to an influx of applications like NFTs and meme coins, thereby strengthening the ecosystem.

Jay Jo [37:41]: “We have a very real community and I'm just honestly very, very thankful for that.”

6. The Giga Upgrade: A Leap in Performance

One of the episode's highlights is the discussion around Sei's latest Giga Upgrade. Launched in December 2024, this upgrade redefines SEI's performance metrics by increasing its gas per second capacity from 105 to an astounding 5 gigagas per second—50 times higher than existing mainnets.

Jay Jo [42:45]: “With that we're able to get, right now we're able to get 5 gigags per second. So this is 50x more than anything you see on mainnet right now.”

This monumental upgrade positions Sei Labs to handle complex, high-throughput applications, paving the way for "killer apps" that can drive mass adoption.

7. Future Vision and Regulatory Landscape

Jay Jo elaborates on Sei Labs' aspirations to ascend to an S-tier Layer 1 project by fostering the development of groundbreaking applications. He underscores the necessity of clear regulatory frameworks to legitimize and propel crypto forward. Notably, he mentions potential policies like zero percent capital gains tax for American crypto companies, which could revolutionize the sector.

Jay Jo [31:06]: “If something like that happens, I think crypto will quickly become the hottest sector in the United States.”

Brendan adds that regulatory support, such as the proposed Bitcoin reserve, could further integrate crypto into mainstream financial systems.

8. The Importance of Ecosystem and Community

Reflecting on Sei Labs' growth, Jay emphasizes that technological advancements alone aren't sufficient. Building a robust ecosystem with active developers and innovative applications is crucial for sustained success.

Jay Jo [36:45]: “The only differentiation that you're able to get is tied to the ecosystem and the community.”

Brendan concurs, highlighting that Sei's advancements in scalability open doors for projects that demand high performance, thereby fostering a vibrant and diverse crypto environment.

9. Closing Thoughts and What's Next for Sei Labs

As the episode concludes, Jay Jo reiterates Sei Labs' commitment to enhancing blockchain performance and building an ecosystem rich with transformative applications. He invites listeners to engage with Sei Labs through their Twitter and Discord channels, ensuring the community remains at the forefront of their journey.

Jay Jo [48:48]: “You could just follow Sei Network on Twitter. They'll have all the announcements and then you can also join the Discord.”

Bryce and Brendan express their excitement for Sei Labs' trajectory, anticipating significant milestones following the Giga Upgrade.

Key Takeaways:

• Transparency and Decentralization: Sei Labs was founded to address the opaque practices seen in centralized platforms like Robinhood, emphasizing the importance of on-chain transparency.

• EVM Compatibility: Recognizing the dominance of the EVM, Sei Labs ensured their platform is EVM-compatible, facilitating easier adoption among developers.

• Scalability with the Giga Upgrade: The recent Giga Upgrade significantly boosts Sei's transaction processing capabilities, making it a frontrunner for high-performance decentralized applications.

• Regulatory Advocacy: Clear and supportive regulations are pivotal for crypto's mainstream acceptance, with Sei Labs advocating for policies that benefit the ecosystem.

• Community and Ecosystem Building: Beyond technology, fostering a dynamic community and attracting innovative projects are essential for long-term success in the Layer 1 space.

For those keen on staying updated with Sei Labs and their groundbreaking developments, follow them on Twitter and join their Discord.