Secret sales of staking rewards: End of the road for Sui Network?

SUI hasn’t even been up and running for two months, and a controversy has already arisen. It is said that the project’s promoters have used investors’ assets without their knowledge. The Sui Foundation denies it all. Let’s get to the bottom of it!

SUI, a new high-potential crypto project?$

The launch of Sui Network by Mysten Labs last May left the crypto community speechless. As soon as it was released, cryptocurrency exchanges such as Bybit, OKX, Binance and Kucoin immediately listed it.

But these 8 weeks of peaceful existence are likely to come to an end. Or at least, the rest of the SUI adventure will be eccentric.

The team behind Sui Network and the SUI token have been accused of unlocking and selling SUI staking rewards on Binance.

Sui Foundation immediately denied these rumours.

Sui Foundation has not sold staking rewards or any other tokens from locked and non-circulating staked SUI on Binance or otherwise.

All insider token allocations remain subject to and compliant with their lock ups and other restrictions on transfer.

— Sui Foundation (@SuiFoundation) June 27, 2023

“Sui Foundation has not sold staking rewards or other tokens from blocked or uncirculated SUI on Binance or any other [exchange]. All insider token allocations remain subject to and compliant with their locks and other transfer restrictions.”

The foundation’s hand caught in the cookie jar

Decentralized blockchain PoS Sui may advocate transparency, but it seems to lack the evidence to refute these allegations of non-consensual sales.

However, DefiSquared, the revealer of secrecy, is heavily armed with evidence.

On May 31, 0x341f sends 2,500,000 SUI rewards to 0x209f. 0x209f then sends 625,000 SUI to 3 different addresses, all of which ultimately end up at binance, but for simplicity we’ll just follow the 625,000 sent to 0x03d8. 9/ pic.twitter.com/EsW5gIDUrS

— DeFi^2 (@DefiSquared) June 27, 2023

As a response, the SUI Network team put forward this modest argument: “a payment subject to contractual lock-in”.

What do you think sparked his curiosity?

“My curiosity was piqued last month by SUI’s seemingly endless sales pressure. Curiously, CoinMarketCap only showed new issues once a month, from its launchpad. Meanwhile, the SUI team refuses to publish an actual issue chart. A strange choice for a legitimate project.”

DefiSquared’s Twitter thread also highlighted a Sui Foundation habit of sharing SUI issue data taken from Binance’s Launchpad. And paradoxically, it criticizes the veracity of these statistics, considering that “the real model doesn’t necessarily follow this graph and won’t be published”.

Or :

“Continuous staking issues amount to around 33,000,000 additional SUIs issued per month. Of the 600 million SUI in circulation, around 250 million are unfounded SUI, which means that these issues represent a 10% increase in unfounded SUI in circulation.”

Which begs the question: is SUI also a shitcoin that would tarnish bitcoin’s image?