Sienna is a privacy-focused, decentralized finance protocol that offers private lending, borrowing, and trading experience to its users. Along with privacy, the platform offers high scalability and low transaction fees.
Sienna network is built on the Secret Network which is the first privacy-focused blockchain network based on secret contracts and secret tokens. Currently, the platform has a bridge to the Ethereum network that will allow the users to covert their ERC-20 tokens into secret tokens. Sienna Network is planning to expand its support to other major blockchains in near future and is fully audited by Certik.
Table of Contents
Problem Statement
Data is one of the crucial components of everyone’s life. It may be your health records, financial statements, email address, password, or simply any invoices or billing details. All of these are common examples of data. While certain data is less sensitive, others are quite confidential, and have the power to reveal the financial and wellness status of an individual. As such, there must be a line between what can be shared publicly and what cannot.
This issue is also found in the blockchain industry. Below are the major problems along with data privacy that users are currently facing:
- Network privacy
- High Gas cost
- Scalability
- Front Running
Network privacy is one of the important concerns of the crypto industry. Blockchain technology is public by nature. That means one can easily check your transaction details using block explorer, and can further track your complete transaction history if they get access to your wallet address. High gas cost and network scalability are currently some of the major problems that all Ethereum network users are facing. Gas fees restrict small investors from utilizing any decentralized exchanges or lending protocols.
Front Running is yet another issue. It is a method where traders wait, watch, and place their trade ahead of some big public trade to book more profit as the price fluctuates. Front Running is an illegal practice, but it cannot be prevented. Traders and miners can easily see the future trades coming to smart contracts because decentralized exchanges (DEXs) are built on the public blockchain.
So overall the current Decentralized Finance (DeFi) structure is flawed at various levels.
The Solution
Sienna network aims to resolve the above problems by introducing a DeFi protocol that promises to protect user-sensitive data. The network ensures users have complete control over their data, allowing them to decide how their data is used. User data will remain within the self-sovereign identities (SSI) that is encrypted and private.
Sienna is built on the Secret network that comprises smart contracts which have encrypted inputs, outputs, and state. Applications built on the smart contracts use encrypted data that is not exposed to other network users or even the node operator.
The platform doesn’t save any login information, wallet data, transaction data, or any other information of the platform’s user. Neither the hosting platform nor any third party has access to the user’s data.
The benefit of privacy-preserving smart contracts is that, unlike public block explorers like Etherscan, user transaction data will not be visible. The platform ensures user wallet balance and transaction details remain completely hidden, and cannot be monitored. This process also helps in preventing front-running. The network is highly scalable and offers low transactions cost making it an ideal choice for small investors.
SIENNA and Wrapped SIENNA
Both SIENNA and Wrapped SIENNA are the two main tokens of the platforms.
Sienna is the native SNIP-20 governance token on the Secret Network. Whereas, Wrapped SIENNA or wSIENNA is the governance token of the Sienna Network. It is the ERC-20 counterpart of the $SIENNA token.
wSIENNA will always be pegged to $SIENNA in a ratio of 1:1. Users can use the Secret Ethereum Bridge to convert wSIENNA for $SIENNA and vice versa. $SIENNA is a privacy token, whereas wSIENNA is a general ERC-20 token.
Public Sale
The platform launched a private sale through institutions and two public sales on DAO Maker and Polkastarter. Between the three token sales, Sienna sold every available token amassing to a huge $11.2 million.
Altogether, $10 million was funded via a private token sale featuring investors such as Lotus Capital, NGC, Inclusion Capital and more. Whereas, the remaining $1.2 million was raised through the public sales on DAO Maker and Polkastarter.
Bridge
The Sienna network supports a bridge that will allow token holders from multiple chains to convert their tokens into secret tokens. Currently, the platform supports bridge only to the Ethereum network. It is planning to support Polkadot, Binance Smart Chain (BSC), Monero, and Cosmos bridges in the future.
By using the Secret Ethereum Bridge users can convert their ERC-20 tokens into corresponding secret tokens. For example, you can convert your ETH into sETH (secretETH), or DAI into sDAI. Later, you can use these tokens on the Sienna network for lending, borrowing, etc.
Sienna Swap
Sienna swap is one of the primary products by the Sienna network and functions as a decentralized Automated Market Maker (AMM) for private, seamless, P2P token swaps. Users can use Sienna swap to swap their ERC-20 tokens into equivalent private tokens or any two private SNIP-20 tokens. This token swapping activity is instant and completely private.
Sienna Lend
Another important product by the Sienna network is Sienna Lend which allows users to borrow and lend both public and private crypto assets. Moreover, users can deposit their tokens and earn interest from them or use their deposit as collateral to borrow a wide range of assets. These assets include stablecoins, cryptocurrencies, and tokenized assets such as real estate, stocks, gold, NFTs, and more.
The entire process will be private and no one can see your earnings or other financial details.
Pool
Platform users can provide liquidity into the pools and help in maintaining liquidity in the protocol. In return, users will earn 0.28% of the trading fee out of the total 0.3% fee while the remaining 0.02% of the fee is converted into SIENNA, and burnt.
The user’s earnings are proportional to their share in the liquidity pool and they are entitled to earn rewards for providing liquidity into certain pools.
Additionally, the platform will launch the pool feature with initially with just SIENNA, but has plans to introduce a pool for all other token pairs in near future.
Rewards
Sienna network incentivizes users for providing liquidity into the network, however, the incentive mechanism is available for only a few token pairs.
Below is the list of LP-tokens that will offer a reward to users:
- SIENNA / sSCRT
- SIENNA / sETH
- SIENNA / sUSDT
- sWBTC / sETH
SIENNA tokens are rewarded to users proportionally to their liquidity share from the 500 token daily amount from each pair pool.
Sienna Network has allocated a total of 3.6 million Sienna tokens to distribute over four years as rewards.
Social Presence
Conclusion
Sienna believes that privacy should come by default and not as an option to users. Through the platform, it is offering a holistic and private DeFi experience to its users.
Users can freely use the platform services to lend, borrow, and swap without fear of revealing their account’s sensitive information. The platform is scalable and offers low transaction costs that set it apart from high gas costs on the Ethereum network. Additionally, transaction privacy also prevents the front running issue and keeps malicious traders/miners away from the network.
As the project introduces support to more chains in the future, we hope it opens up the opportunity for other network users to use the platform and boost adoption.
Resources: Sienna Network Whitepaper
Read More: An Overview of Multiplier Finance
