Is Sui Foundation quietly selling off?

Is Sui Foundation being sold off?

Author: DeFi^2 (@DefiSquared); Translator: Babywhale, Foresight News

The author of this Twitter Thread is DeFi^2, who is shown on their Twitter profile to be a major trader on Bybit and holds a DeBank top ten address. The thread does not provide actual trading evidence for the claim that Sui was being sold off by its original lockup holders, but does present clear on-chain evidence that the Sui Foundation was continuously selling off its staking rewards to the market.

Exclusive new research on SUI: The Sui team intentionally concealed the actual amount released, and is selling the “locked” and “non-circulating” SUI staking rewards on Binance.

Last month, the unending selling pressure on SUI piqued my curiosity. Strangely, CoinMarketCap only shows new releases once a month. Meanwhile, the SUI team “refuses” to release a true release chart. This is strange for a large project.

The announcement by Binance launchBlockingd and the emission chart below are often cited by the Sui team. But the problem is that the team admits that the chart is not actually accurate and that the true model does not necessarily follow the chart, so they will not release it.

The reality is that although the data received by CoinMarketCap shows only one release per month, the supply is actually increasing every day. Importantly, these released tokens include SUI from “locked” shares (such as VC shares), which are not locked and unrestricted.

Looking at the numbers now, staking rewards will increase by 33 million SUI per month, and of the current 600 million total supply, about 250 million are held by non-foundation members (freely circulating), meaning the circulating supply will increase by over 10% per month.

In addition, there is a release of 37 million SUI from LaunchBlockingd each month. In other words, if you hold SUI, you will currently be diluted by 20% per month, which is higher than the inflation rate experienced by the Venezuelan bolivar during its hyperinflation in 2022.

However, the real “big bombshell” is that the Sui Foundation holds nearly 3 billion non-circulating and pledged SUI tokens (about 6 times the current circulating supply), and the pledged rewards are currently being sold on the secondary market. Let’s start with the address starting with 0x341f:

Wallet 0x341f has been confirmed as the Sui Foundation wallet, as it holds 2.9 billion pledged SUI (30% of the fully diluted supply). SuiVision confirmed that the address has accumulated a suggested nearly 27 million SUI. Let’s track the on-chain information to see where they went.

On May 31, 0x341f sent 2.5 million SUI to the address starting with 0x209f. Then, the address starting with 0x209f sent 625,000 SUI to 3 different addresses, all of which eventually ended up on Binance. For simplicity, we will only track the 625,000 SUI sent to 0x03d8.

0x03d8 split again, sending 300,000 SUI to 0x1985. 0x1985 sent most of it to 0xa0f3 in different transactions. Finally, 0xa0f3 sent it to 0x9350, which is obviously a hot wallet of an exchange. I verified that it is Binance’s wallet by depositing/withdrawing SUI myself.

It is worth noting that although these funds have been split multiple times, most of them eventually ended up on Binance. This may be to confuse the situation, or it may be because it was allocated to different team members.