Disclosure: I am eligible for the Saga Airdrop because I was an active staking participant on the Celestia blockchain. (I wrote about Celestia in this blog)
Saga allows developers to automatically spin up parallelized & interoperable dedicated chains that elastically scale with their Web3 application needs.
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Platform disruptions have historically transformed entire industries by unlocking new possibilities for innovation. I want to explore the nature of such disruptions and their outsized impact as well as analyse the need for a similar shift in web3 infrastructure.
A platform disruption occurs when a new technology fundamentally changes the rules of an existing market by simplifying previously complex problems. Pioneers like Amazon, Google and Apple disrupted their industries by offering integrated platforms that handled infrastructure concerns for others, allowing focus on new frontiers of innovation. This empowered a massive wave of new applications that may have otherwise remained unrealized.
Web3 aims to decentralize technologies through distributed ledgers but faces barriers to its own disruption. While innovations attempt to expand the limited block space available, complexity and constraints still block(no pun intended) most developers. For web3 to empower widespread innovation and experience explosive growth, it requires a shift in how it handles infrastructure challenges.
Read the litepaper here.
Saga proposes such a disruption through its "Integrated Stack" that automates dedicated blockchain provisioning. In this essay I will analyse Saga's vision as well as examples of past disruptions.
It Was Written in the Clouds
The first internet applications in the late 1990s faced significant challenges to access infrastructure and scale to meet user demand. A prime example was Netflix, which launched a DVD rental business before pursuing online video streaming. However, the infrastructure available at the time could not support the massive bandwidth needed to stream video content over the internet to consumers.
Amazon recognized an opportunity to disrupt the internet hosting market. In 2006, Amazon launched AWS which handled all the difficulties of data centre ownership and operations on behalf of other companies. By offering cloud computing infrastructure as a pay-as-you-go utility, AWS removed the prohibitively high upfront costs that had previously blocked many start-ups and smaller firms.
The cloud platform model simplified access to advanced infrastructure that was now easily provisioned on demand. This empowered a wave of new internet applications across industries that may have been unfeasible previously. While high costs remained for some large applications like Netflix, the cloud vastly expanded opportunities for innovation at a smaller scale. Philosophically, AWS democratized participation in technology progress by lowering barriers to entry.
During my time at IBM in the 2010s, I was part of the company's efforts to transition more of its software offerings to the emerging Software-as-a-Service model. This represented a major shift away from traditional licensed software towards subscription-based, cloud-delivered products and services. The transition presented many technical and business challenges around rearchitecting codebases, overhauling pricing and contracting, and gaining trust from customers accustomed to perpetual licenses. However, it was clear that the market was rapidly moving in this direction following the success of early SaaS providers.
The Saga Continues
All that preamble brings me neatly to the meat of this essay. Saga aims to disrupt the web3 ecosystem by providing developers with easily accessible dedicated block space through its "Integrated Stack" platform. Saga's vision directly addresses the core challenges that have faced the industry - scarce and expensive infrastructure resources that disincentive all but the most experienced builders.
By automating the provisioning of parallel interoperable chains, Saga offers developers "plug-and-play" infrastructure that handles complexities like consensus, data availability and network security behind an intuitive interface. This simplifies previously prohibitive onboarding costs and the technical expertise required. The "Pegasus" release demonstrated how developers can have customized chains launched within minutes using a standardized stack.
Saga's economic model further simplifies participation through a pay-as-you-go approach versus complex fee bidding where developers must bid transaction fees to have their transactions prioritized for processing. This complexity disincentives experimentation and limits accessibility for new developers unfamiliar with fee mechanics.
This represents a philosophical shift towards greater participation by lowering barriers. By focusing on usability over theoretical purity, Saga aims to vastly expand the developer base and unlock untapped demand.
However, such centralization of control also presents risks to long-term decentralization. Over-reliance on Saga's proprietary stack could concentrate power and path-dependence. Additionally, long-term security depends on Saga's own governance and upgrades remaining decentralized.
While Saga's vision could massively grow the web3 ecosystem by bringing in new builders, realizing this potential will require navigating tensions between accessibility and decentralization. The implications of platform control will be an ongoing discussion as the disruption unfolds.
Overall, Saga's novel approach represents an intriguing proposal to stimulate blockchain innovation on a wider scale.
The $SAGA Token Model
Saga has introduced innovative token mechanisms designed to simplify economic flows for developers compared to existing blockchain networks. At the core of this model is the $SAGA token, which serves several integral purposes within Saga's ecosystem.
Firstly, $SAGA is used to pay transaction fees for application usage, replacing the need for complex gas bidding. Developers can make unlimited transactions by maintaining a balance of SAGA tokens. This represents a shift towards a standardized subscription model over scarce bidding, lowering barriers.
$SAGA also acts as a staking token to secure the network. Validators lock $SAGA tokens in order to participate in consensus and be eligible for block rewards. This introduces incentives while distributing control more widely among stakeholders. In contrast to platforms where fees directly reward miners, Saga's model separates transaction costs from security provision.
Additionally, $SAGA serves as a currency for the Saga ecosystem. By enabling internal token liquidity, this facilitates a variety of use cases from developer incentives to community governance. Over time, network effects are expected to organically grow demand for SAGA from multiple use cases.
Philosophically, Saga's model aims to balance the objectives of decentralization, accessibility, and sustainability. By introducing standardized and predictable transaction costs, Saga makes participation affordable for a broad range of builders. At the same time, staking and currency roles distribute control while aligning the long-term success of the platform with token holders.
In Conclusion
While Saga's novel approach shows intriguing potential, only time will tell if it can achieve the scale necessary to become a dominant web3 platform. There remain open questions around decentralization governance and sustainability that will need to be addressed.
For those interested in following Saga's progress, or sparking discussion around the topics analysed in this essay, I encourage you to share this work with others and subscribe for future updates.
