Sequentia is an upcoming Bitcoin sidechain based on a fork of Elements (a fork of bitcoin core made by Blockstream and used for the Liquid Network).
We have now launched a signet and a demo walkthrough showcasing one of Sequentia's two most fundamental features, which are also the two most key differences with Liquid. These are therefore also the two development milestones that we've committed to building before we launch a mainnet.
As demonstrated by the signet and walkthrough, Sequentia is the first blockchain with no specific or native coin for transaction fees. Instead, it allows users to propose transaction fees with any token issued on it.
Without going any further, if Blockstream were to integrate some of the modifications to Elements we've already made so far, you could pay transaction fees on Liquid in USDT directly (as also possible with Liquid Taxi, except directly at the protocol level, therefore jumping through fewer hoops, and able to become the default behaviour of most wallets with most assets) etc. while L-BTC could still of course exist and be used to represent BTC on the sidechain, but it would not necessarily be favoured over any other pegged BTC or other assets by the network itself, since tx fees could be proposed using anything at all and block producers will likely accept anything of relatively stable value and sufficient liquidity.
However, the next (and final before mainnet launch) major development milestone will perhaps be considered the most defining characteristic of Sequentia: Bitcoin Anchoring.
In the context of Sequentia, "Bitcoin anchoring" refers to a consensus rule requiring each Sequentia block to contain a reference to the hash of a Bitcoin block at an equal or greater height than the block referred to by the previous Sequentia block. Since Sequentia will have a higher block frequency than Bitcoin (similar to Liquid), several Sequentia blocks can refer to the same Bitcoin block.
The goal of this policy is to ensure that Sequentia reorganizes every time Bitcoin does (every Sequentia block containing a reference to an orphaned Bitcoin block is discarded), as assuming that Sequentia never reorganizes by itself, this creates an opportunity to have reorg-proof cross-chain atomic swaps, and even submarine swaps, with BTC on the mainchain/LN. You could, therefore, have viable native Bitcoin and even Lightning DEXs for tokenized assets issued on Sequentia, where, unlike with Liquid or any other sidechain today, you can actually implement these cross-chain swaps with real BTC without needing to add a burdensome timelock in case the swap reverses on one chain and not the other.
So as you might be able to tell by now, the use-cases and intended user experience / user journey on Sequentia are actually fairly similar to that of Taproot Assets (i.e. a bitcoin/LN wallet with access to tokenized assets that can also be transferred over LN and p2p swapped for on-chain/LN BTC at any time), but with a completely different approach to implementation, such that Sequentia doesn't ever need to compete for (far too scarce!) Bitcoin blockspace to write into, whereas Taproot Assets does whenever an asset is issued, locked into or unlocked from a lightning channel, and also for the transfer of assets without sufficient liquidity to warrant using over Lightning.
More changes are planned besides the two features that I've described here, but these will come much later, after the initial launch of the Sequentia Network. One of these planned post-mainnet upgrades is opening up the federation of Sequentia blocksigners to market-based participation. Our current proposal for this and several other features can be found in the Sequentia whitepaper.
We would highly appreciate any feedback on this demo! This is a completely open-source project, and we will try to compensate any contribution to the codebase commensurately, so please jump right ahead if you think this sounds like something you could add to.
Liquid is a federation of somewhat reputable members. Who will create the blocks of Sequentia and why should I trust them?
If there is no peg, what is to stop unbacked inflation?
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Your first question is a fairly good one. Unfortunately, we simply don't know the answer yet. There's still some time before we are ready to go live, and hopefully by then we can assemble a federation that's of equally reputable members as Liquid's, or maybe even share some of the same federation members...
As for the second question, I think there might be some misunderstanding. While there is no "native" peg that's required to pay transaction fees, you can still issue pegged BTC on Sequentia, and it can work exactly like L-BTC does on Liquid. The difference is that:
  • You can propose transaction fees using any token issued on Sequentia, it doesn't need to be a specific pegged Bitcoin, and it can actually be any other token, such as USDT
  • Unlike Liquid or existing sidechains, Sequentia will support making p2p swaps with real BTC (on the mainchain or on LN) in real-time, so you won't necessarily need to ever have any kind of representation of BTC on the sidechain.
There is no inflation because there is no native coin, block producers are only rewarded with the transaction fees they collect (in whatever tokens they're willing to accept), there aren't any block rewards on top of that.
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how will we know in advance what fee the block producers will accept? if it is some illiquid shitcoin, there may not me a market rate. on liquid the fee rate is a standard 0.1 sat/vB.
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There will of course be infinite different ways for wallets to calculate fee estimates and some may prove more accurate than others, but in the case of tokens which are often used to pay for tx fees, looking at recent on-chain data should prove to be a sufficiently effective method.
What's important is how block producers will choose which tokens they're willing to accept and at what rate. To that end, we've developed a "price server" software which nodes can use to connect to an external data source such as a CEX API or a DEX Oracle such that they can designate a reference unit, calculate the prices of different assets in this reference unit (and apply weights/multipliers depending on factors such as liquidity), and update their list of accepted assets and rates accordingly.
if it is some illiquid shitcoin, there may not me a market rate
That's exactly right. When transferring an illiquid shitcoin, you may also need a more liquid token to pay tx fees with. In such an environment it is obviously very important to be able to bump transactions that get stuck due to the proposed asset, and even change the proposed tx fee asset using RBF - we've implemented a way to do that and it's shown in the demo!
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Look forward to testing it out.
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you guys are the best, Sequentia does not need a specific peg-in mechanism or any determined token to pay for transaction fees.thanks a lot for the demo walkthrough
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This remains the truth.
There is only one blockchain that we consider perfectly adequate for monetary settlements, and that is Bitcoin.
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Congratulations
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Soon we will have a bajillion sidechains, each operated by its own little corporation, touting major improvements over others.
Result? Confused bitcoiners who don't know what to choose. Also, each sidechain is its own little walled garden, with no interoperability.
That is until we start getting "bridges". Then we can expect a deluge of hacks, exactly how we've seen in shitcoin land.
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Sequentia is the first sidechain which doesn't claim / try to be a bitcoin payments scaling solution. We are the first sidechain builders that actually believe sidechains NOT to be a good solution for bitcoin payments, and which instead bet on the Lightning Network as the only real L2 for Bitcoin.
Sequentia is anti-bridge technology
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Is there an easy way or article that explains how tokens are issued? Maybe it’s a stupid question but I couldn’t help. I understand that there isn’t a multisig peg-in/peg-out system and Sequentia is a “slavechain”, but I don’t understand this alternative method.
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Tokens will be issued in the same way as they are on Liquid, in fact the initial version of Sequentia that will be launched in a few months will be almost identical to Liquid in every way except that:
  • You can propose transaction fees using any token issued on Sequentia, it doesn't need to be a specific pegged Bitcoin like L-BTC, and it can actually be any other token, such as USDT
  • Unlike Liquid or other existing sidechains, Sequentia will support making p2p swaps with real BTC (on the mainchain or on LN) in real-time, so you won't necessarily need to ever have any kind of representation of BTC on the sidechain.
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Also, if you check out the Sequentia signet walkthrough it will guide you on issuing an asset on Sequentia, paying tx fees using it, issuing a second asset and transferring asset 1 with fees paid in asset 2, and even using RBF to change the proposed tx fee asset in an unconfirmed transaction.
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This sounds great, can't wait to give it a test drive.
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Very excited to know about Sequentia!
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Congrats!
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deleted by author
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ChatGPT
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Free or paid version?
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LOl community noted you love to see it
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Congrats on the launch! Any YouTube demos showcasing the main differences?
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stackers have outlawed this. turn on wild west mode in your /settings to see outlawed content.