Saga is a protocol that enables developers to deploy application-specific blockchains, called Chainlets, with minimal infrastructure effort. It is designed to simplify the process of launching dedicated blockchains by offering an integrated deployment stack that abstracts complex components such as security, execution, and consensus.

Saga’s architecture is modular and based on Cosmos SDK, using Interchain Security to inherit security from a shared validator set. Its protocol comprises three primary components:

• Security chain: Where protocol security is anchored and validator behaviour is monitored. Slashing and staking occur here.

• Platform chain: Manages the provisioning of Chainlets and forwards security to them using cross-chain validation.

• Chainlets: Independent blockchains where end-user applications are deployed. Each Chainlet operates with its own compute environment and virtual machine.

Saga supports multiple virtual machines and aims to offer flexibility for developers to choose the execution environment that suits their application. The protocol is being launched in stages (via the Pegasus release) to incrementally activate features such as validator decentralisation, shared security, and slashing mechanisms.

SAGA is the utility token used within the Saga protocol to facilitate its internal operations.

Key functions of the SAGA token include:

• Provisioning Chainlets: Developers use SAGA to subscribe to and maintain Chainlet infrastructure. The token acts as a prepaid balance for compute capacity.

• Staking: Validators stake SAGA to secure the network and are subject to slashing for violations.

• Validator incentives: SAGA is used to compensate validators for running Chainlets and maintaining protocol infrastructure.

• Developer bonding: Developers may bond SAGA tokens to guarantee uptime and usage of Chainlets.

Saga employs a two-part token flow:

• Front-end, between application users and developers, where developers may collect fees in various assets.

• Back-end, between developers and the protocol, where fees are settled in SAGA to access protocol-level infrastructure.

SAGA is not directly used by end users of dApps; instead, developers absorb or abstract these infrastructure costs.