Features, Ecology, Token Model, and Investment Value of Sui Public Chain

On April 20, 2023, according to the official Twitter announcement, the public chain project Sui has confirmed that it will launch its mainnet on May 3. The native token SUI, previously sold through cryptocurrency exchanges, will also be unlocked during the mainnet launch. Regarding the SUI token, the Sui project team has stated that SUI tokens will not be airdropped and confirmed on April 15, 2023, that the tokens will be sold through an Initial Exchange Offering (IEO).

For this IEO sale, KuCoin, Bybit, and OKX have announced that they will sell SUI tokens. The public sale subscription price is 1SUI = 0.1 USD. However, the community's reaction to the statement "SUI tokens will not be airdropped" has been very strong, with some netizens commenting under the tweet: NO AIRDROP = NO COMMUNITY. Not using airdrops to incentivize active community users is indeed not very Web3, but the Sui team has also included contributors to the public chain ecosystem in the whitelist for purchasing SUI at a more favorable price (0.03 USD) and securing a quota of 1500 tokens.

So, is the SUI token worth participating in? This article will analyze the Sui public chain from multiple perspectives and comprehensively interpret the information about the SUI token IEO.

Sui Public Chain Features & Advantages

Sui is the world's first permissionless Layer 1 blockchain designed entirely by former Facebook developers. As a decentralized PoS blockchain, it achieves throughput and storage scalability and aims to become the first internet-scale programmable blockchain platform. The Sui ecosystem uses the Rust-based Move programming language and employs the same PoS consensus mechanism as Ethereum. Its main features are as follows:

• Strong scalability: The network can achieve throughput scalability by reaching parallel agreements on causally independent transactions. They achieve this through Byzantine Broadcast, eliminating the overhead of global consensus while maintaining security and liveness guarantees.

• Secure smart contract language: Move is a programming language originally developed by Facebook for writing secure smart contracts. It supports cross-chain shared libraries, tools, and developer communities.

• Ability to define complex on-chain assets: Sui's scalability is not limited to transaction processing. Its storage is also low-cost and horizontally scalable, allowing developers to define complex assets with rich properties directly on the chain, without introducing an off-chain storage layer to save gas fees.

• Better Web3 user experience: The Sui team aims to make it the most accessible smart contract platform, enabling developers to create excellent user experiences in Web3. To welcome the next billion users, Sui will provide developers with a variety of tools to leverage the powerful features of the Sui blockchain. The Sui Software Development Kit (SDK) will enable developers to build without limitations.

In summary, Sui's architecture is known for real-time settlement, high throughput, rich on-chain assets, and an excellent Web3 experience. Its horizontally scalable throughput and storage enable efficient DApp development at lower costs.

Team Overview

Sui's development team is Mysten Labs, with founders including Evan Cheng, Adeniyi Abiodun, Sam Blackshear, George Danezis, and Kostas Kryptos, all of whom have participated in Facebook's Novi and Diem projects.

The project announced the completion of a $36 million Series A financing in December 2021, led by a16z, with participation from Coinbase Ventures, NFX, Slow Ventures, Scribble Ventures, Samsung NEXT, Lux Capital, and others. On September 8, 2022, it raised $300 million in a Series B financing led by FTX Ventures, with other investors including Coinbase Ventures, Jump Crypto, a16z, Circle Ventures, Binance Labs, and O'Leary Ventures.

The behavior of conducting an IEO before the project's mainnet launch has led many netizens to question whether the Sui project team is facing a funding shortage due to FTX's collapse last year. However, some have clarified that the Sui project team had already used up the $100 million investment from FTX and there is no need to worry about it.

Sui Ecosystem Project Overview

So far, the Sui ecosystem has attracted many teams to build projects and many early high-quality projects have received grants from Sui, distributed across various tracks such as cross-chain, SocialFi, traffic, and DeFi. Here is an overview of four projects that have received grants from the Sui project team:

• SUIA: The first POAP application on Sui, a social dApp built on the Sui network, aims to create an open, powerful, and community-driven social network. The project has innovated in four areas: personalized NFT recommendations, on-chain activity-based feeds, NFT-based brand clubs, and composable personal spaces. Currently, SUIA has over 200,000 users, 50 core brands, and a community of over 300,000 people. It has received grants from the Sui Foundation and Sui Builder Heroes. Its next plan is to enable more social features for users, such as community games and social trading.

About SUIA:

Link

• ComingChat: ComingChat is a SocialFi product designed to address the fragmented user experience of Web3 products. The product also incorporates some aspects related to ChatGPT, providing a Web3 gateway application that supports multiple public chains and offers DeFi and GameFi functionalities. At the application layer, ComingChat includes features such as DID, wallets, encrypted communication, social networks, DeFi, and GameFi. At the protocol layer, ComingChat aims to support a multi-chain ecosystem.

About ComingChat:

Link

• MovEX: MovEX is the first AMM+order book hybrid liquidity DEX on Sui, combining the advantages of AMM and order book to provide a liquidity trading experience for everyone through the creation of hybrid liquidity pools. Internally, MovEX has a settlement engine that allocates orders between AMM and order book, ensuring minimal slippage for traders and fair treatment for liquidity providers. Liquidity providers can also provide one-sided liquidity within a customizable price range, effectively managing impermanent loss.

About MovEX:

Link

• Movernance: Movernance is the first fully-featured on-chain governance platform in the Sui ecosystem. It provides necessary decentralized governance for projects by integrating governance forums and on-chain voting functions. Movernance has innovatively proposed a permission governance framework and a governance market (bribery platform), improving the overall efficiency of decentralized governance and providing a solid foundation for the large-scale application of projects.

The current development of the Sui ecosystem is relatively balanced and is in a healthy and benign development state. The projects that have received grants from the official Sui team are based on the core needs of a public chain and are expected to help the entire ecosystem develop in an orderly manner. In terms of these projects themselves, there are not many innovations and highlights, and it is believed that after the completion of the public chain's basic construction, there will be more fresh and creative projects coming to the Sui ecosystem.

Token Economic Model

The total supply of SUI tokens is 10 billion, distributed to 50% community reserves, 20% early contributors, 14% investors, 10% Mysten Labs treasury, and 6% community access plan for IEO and application testers. The token has four main use cases: network staking, transaction fees, storage fees, governance voting, and SUI native asset trading tools.

The five core components of the economic model are:

• Proof of Stake (PoS) mechanism for selecting, incentivizing, and rewarding Sui platform operators (validators and SUI delegators).

• All network operations incur gas fees, used to reward participants in the Proof of Stake mechanism and prevent spam and denial-of-service attacks.

• Sui's storage fund is used for transferring equity rewards over time and compensating the storage costs of previously stored on-chain data by future validators.

• On-chain voting for governance and protocol upgrades.

• The SUI token is the native asset of the Sui platform.

Unlike the token economic model of traditional Proof of Stake chains, Sui's model adds the function of a storage fund. Since blockchain is a data structure that only grows, the data that needs to be maintained on the chain will increase over time, leading to higher costs. The storage fund is designed to address this issue by making early users pay higher fees, allowing all users to use the network based on similar fee levels.

In addition, the Sui storage fund also pays validators in the system who actually store blockchain data and perform data maintenance. As maintenance work increases, the payouts to validators also increase, incentivizing more people to become validators in the system. As more people become validators, the total available storage space also increases, further reducing the gas fees for writing to the blockchain. Sui's token economic model is a typical representative of a highly scalable chain economic model, using game theory to ensure that gas fees remain relatively constant throughout the entire lifecycle of the blockchain.

IEO and Whitelist Purchase Details

The latest sale details for this IEO on three major exchanges are as follows:

• KuCoin: 2.25 billion SUI tokens (not available to mainland users)

• Group A public sale, from 08:00 on April 15 to 24:00 on April 22 (UTC+8). KuCoin will take hourly snapshots of users' total balances in USDT, USDC, ETH, and KCS to determine the number of lottery tickets each user will receive. At the end of the period, winners will be selected through a lottery.

• Group B identification sale, from 09:30 on April 20 to 24:00 on April 22 (UTC+8). All whitelist users must complete all subscription processes. This round is only applicable to early contributors of Sui and must be whitelisted. Users can check their eligibility at: Link. Sui has contacted whitelist users via email, and users can participate in KuCoin using the email address assigned to their account.

• Bybit: 9.4 billion SUI tokens (not available to mainland users)

• Subscription period: from 12:00 on April 21 to 08:59 on April 24 (UTC+8)

• Allocation period: from 09:00 to 13:59 on April 24 (UTC+8)

• Results announcement: at 14:00 on April 24 (UTC+8)

• OKX: 2.25 billion SUI tokens (available to mainland users)

• Subscription period: from 10:00 on April 23 to 10:00 on April 24 (UTC+8)

• Draw statistics: at 10:00 on April 24 (UTC+8)

• Token distribution begins: at 18:00 on April 24 (UTC+8)

• Whitelist qualifications:

• Early participants who joined the Sui Discord community before February 1, 2023, and made significant contributions by providing suggestions, participating in discussions, interacting with ecosystem projects, and advocating for technological innovation. (Approximately 20% chance of being selected)

• Winners of the Capy Holidays competition in Testnet Wave 1, selected through social media voting according to the specified competition terms, will receive SUI rewards.

• Members who have participated in organizing and operating Builder Houses and other important activities, demonstrating their love for Sui and the significant time and effort they have put into it, will receive SUI rewards after the mainnet launch.

Investment Value Discussion

Sui is often compared to Aptos because both projects were founded by former Facebook employees. Although Aptos is certainly commendable, Sui is considered a more advanced version with a more solid technological foundation. Aptos currently has a fully diluted valuation of $13 billion and a circulating market cap of $2.3 billion. Since the market has given Aptos such a high valuation, Sui is also expected to have a very high valuation.

The public sale plan for Sui's IEO has indeed disappointed many community users and is also unfavorable for the future community building, causing many active participants to lose confidence. Objectively speaking, although the Sui project team is not good at marketing, the IEO has still accumulated a lot of discussion and attention in the community, and the technical and stability aspects of the Sui public chain are commendable.

Overall, with a strong team background, and considering Aptos, Sui may have a very high valuation. The current IEO for SUI has sparked a lot of speculation and attention in the market, which may bring strong FOMO sentiment. However, the shortcomings in the Sui team's marketing operations and the unresolved FTX funding issue are also causes for concern.

The veDAO research team hereby reminds that there is no airdrop for the SUI token, so be wary of scams during the IEO. If you are interested in the SUI IEO, the following links can quickly take you there:

SUI Details:

Link

SUI Official Website:

Link

SUI Official Twitter:

Link

Token Economic Whitepaper: The Sui Smart Contracts Platform: Economics and Incentives

Link

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