2. Sequentia Overview
Sequentia is a new blockchain network with its own wallets, block explorers, and services. It is an open-source project, and anyone is free to contribute to or fork the codebase, or create alternative software following the consensus/protocol RFC.
Specifically, Sequentia is a Bitcoin sidechain dedicated to asset tokenization – like stablecoins and stock tokens – and Decentralized Exchange transactions, including direct atomic swaps (§5.1) and lightning swaps (§5.2) between BTC and any token issued on the Sequentia sidechain.
Sequentia is defined as a sidechain by virtue of the anchoring mechanism (§3.4) between Sequentia blocks and Bitcoin blocks. This link to Bitcoin also affects the network’s technical architecture and the consensus system, resulting in a hybrid mechanism employing both Bitcoin’s Proof of Work (“PoW”) and some parts of the stake-based governance of a typical Proof of Stake (“PoS”) system.
Sequentia blocks are created by users who have a large enough stake in the network, in the form of Sequence (SEQ) tokens locked through a staking mechanism. However, unlike virtually all other PoS networks, there is no specific token to pay transaction fees with over Sequentia; any token can be accepted by block producers, in a free market of transaction fees (§3.2). This lack of a native fee token (also known as a “Coin”) reduces friction in user experience and improves scalability.
Anyone is free to create a different wallet and node. However, some specifications are recommended for developers building on Sequentia that are willing to stick to the fundamental principles illustrated in this White Paper.
Ideally, a Sequentia wallet should have multi-token support and the following basic multi-token functionalities:
Store, send, and receive Bitcoin just like any other traditional Bitcoin wallet
Store, send, and receive tokens issued on the network, known as RAS tokens (where RAS stands for Regular Assets on Sequentia §4.2), including Sequence (SEQ) tokens, the governance utility token of the Sequentia blockchain.
Allow users to manually set on-chain fees, choosing the specific token to pay fees with and the amount. The possibility to query a service for the calculation of fees is recommended.
Allow replace-by-fee and child-pays-for-parent functionalities; this is particularly necessary because acceptance of transactions by block producers is optional, and may depend on the token chosen by the user sending the transaction..
Process the Access-Control-List rules (see §4.5), which are introduced for security/stock tokens or other tokens that require particular policies.
Process Bitcoin script smart contracts.
In addition, it is preferable for Sequentia wallets to also allow users to:
Batch transactions (see §4.4) with peers before broadcasting to the network, in order to pay lower fees, alleviate the burden on the blockchain and accelerate transactions.
Use the Lightning Network for transactions (both with BTC and RAS tokens).
Ideally, a Sequentia full node offers all the wallet functionalities listed previously, plus the following:
Stake SEQ tokens to become a participant in the network’s block production mechanism.
When selected to do so through this mechanism, propose or countersign blocks and earn transaction fees.
Create a RAS token by executing an on-chain transaction in Sequentia.
Make updates to RAS token policies (such as ACL, see §4.5).
Create custom smart contracts and programmable accounts (see §4.6) to manage financial operations.
Connect to services to query for DEX data (such as the DHT order book, see §5.4). Standard wallet API may be provided so that oracles can be programmed to help build smart contracts on Sequentia using third-party information.
A Sequentia full node retrieves information regarding the Bitcoin blockchain from the Bitcoin network, ideally through a self-hosted Bitcoin Core full node.
Sequentia full nodes may also eventually implement utreexo (2), which compacts the size of the UTXO set down to 1 KB. As such, pruned nodes will never take up more than around 1.5 GB of space (about three days of blockchain at maximum throughput), even in the long run.
Footnotes/p2
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