Sei Network developer raising funds at $400 million token valuation: sources

Sei Labs, a crypto startup building a Layer 1 blockchain network, is raising Series A funding via an equity-plus-token-warrants round.

The round looks set to give Sei Labs a $400 million token valuation or fully diluted valuation (FDV), three sources with direct knowledge of the matter told The Block. The equity valuation will reach $200 million, said two of the three sources.

Jayendra Jog, co-founder of Sei Labs, declined to comment on the funding round but said the project aims to build the best infrastructure for exchanges.

What is Sei Network?

Sei Network, part of the Cosmos ecosystem, is the first sector-specific Layer 1 blockchain specialized for trading, according to a pitch deck prepared by Sei Labs and obtained by The Block.

Blockchains like Ethereum, Solana, Aptos and Avalanche are general-purpose networks, while dYdX chain, Injective, Osmosis and Umee are app-specific chains. Sei Network, on the other hand, is the only sector-specific chain, according to the deck.

Jog said Sei Network aims to solve the problem called "the exchange trilemma" between decentralization, capital efficiency and scalability. Today's crypto exchanges — centralized and decentralized — can only get two of the three, according to Jog.

"If you look at Uniswap V2, for example, it gets decentralization and scalability, but not capital efficiency. And Binance, for example, gets capital efficiency and scalability, but not decentralization," said Jog. "Sei Labs is building infrastructure for exchanges to provide the decentralized exchange experience identical to that of the centralized exchange experience."

Jog said Sei Network is focused on the trading sector, meaning it wants to support not only crypto exchanges but also NFT and game-asset marketplaces. Sei's vision is to become "the destination for all on-chain trading globally across any digital asset," per the deck.

Mainnet and airdrop

Sei Network is currently in testnet, and already more than 120 projects are building on it, according to Jog. He said the mainnet is expected to launch in the second quarter of this year, adding that there will be an incentivized testnet before the mainnet. Sei will also conduct an airdrop around the mainnet launch, Jog said.

Sei's new funding effort comes six months after it raised $5 million in August 2022. That round was led by Multicoin Capital, with participation from Coinbase Ventures, GSR, Flow Traders and others.

Projects building new blockchains and scaling networks continue to raise funds. In recent weeks and months, several such projects — including Dymension, VRRB Labs and Sovereign Labs — have raised funds.