# 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**](https://docs.sequentia.io/white-paper/dex/5.1.-atomic-swap)) and lightning swaps ([**§5.2**](https://docs.sequentia.io/white-paper/dex/5.2.-lightning-network-swap)) between BTC and any token issued on the Sequentia sidechain. Sequentia is defined as a sidechain by virtue of the **anchoring mechanism** ([**§3.4**](https://docs.sequentia.io/white-paper/3.-blockchain-architecture/3.4.-bitcoin-anchoring)) 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**](https://docs.sequentia.io/white-paper/3.-blockchain-architecture/3.2.-open-fee-market)). 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**](https://docs.sequentia.io/white-paper/4.-asset-tokenization/4.2.-the-ras-standard)), 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**](https://docs.sequentia.io/white-paper/4.-asset-tokenization/4.5.-access-control-list)), 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**](https://docs.sequentia.io/white-paper/4.-asset-tokenization/4.4.-peer-to-peer-batching)) 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). * Peer-to-peer exchange BTC and RAS tokens using an **atomic swap DEX** (see [**§5.1**](https://docs.sequentia.io/white-paper/dex/5.1.-atomic-swap)) and **lightning swap DEX** (see [**§5.2**](https://docs.sequentia.io/white-paper/dex/5.2.-lightning-network-swap)). 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**](https://docs.sequentia.io/white-paper/4.-asset-tokenization/4.5.-access-control-list)). * Create custom smart contracts and **programmable accounts** (see [**§4.6**](https://docs.sequentia.io/white-paper/4.-asset-tokenization/4.6.-programmable-accounts)) to manage financial operations. * Connect to services to query for DEX data (such as the DHT order book, see [**§5.4**](https://docs.sequentia.io/white-paper/dex/5.4.-distributed-hash-table-dht)). 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)**](#footnotes), 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 > 2\.