Discussion on Sui Ecosystem Data Analysis and Token Release Situation

Since Sui, as one of the representative projects of the Move-based public chains, went live on May 3, more than 40 days have passed. As a project that takes a different development route from Ethereum L2, Sui has sparked considerable discussion since its launch, particularly regarding its Token issuance method and release model. Some are concerned that it may repeat the mistakes of ICP, while others believe it could perform similarly to the new public chains of 2021.

So, how is the ecological development of Sui? What are the recent Token releases and demands like?

1. On-chain Data Analysis

1. TVL ( Total Locked Value )

As of June 13, the TVL of Sui was 15.22 million USD, with the DEX Cetus accounting for over 60% of the share. Among all public chains and layer two networks, Sui's TVL ranks 54th. It is worth noting that Sui's TVL peaked at 36.01 million USD and has currently dropped by more than 50%.

In comparison, another Move ecosystem representative project Aptos currently has a TVL of $42.11 million, which reached a maximum of about $65 million since its launch, ranking 34th in TVL.

2. Trading Volume

The highest daily trading volume on the DEX of Sui occurred on May 10, exceeding 19 million USD, and has since shown a downward trend. Since June, the daily trading volume has mostly hovered between 3 million and 6 million USD, with relatively low trading activity.

3. Network Activity

Since its launch, Sui has reached a total of 16.53 million transactions, with an average TPS of 3, a total of 850,000 active addresses, and 104 active nodes. The highest TPS on the network was 26, occurring on May 12, coinciding with the Turbos IDO issuance day.

It is worth noting that the actual TPS of Sui is still lower compared to Ethereum L2.

From the perspective of daily active addresses, the peak occurred on May 20, reaching 130,000. The main reason was that on May 19, Cetus opened the permissionless pool feature, and at the same time, meme projects conducted airdrops across the entire network. During normal periods, the daily active addresses are usually below 10,000.

4. Cross-Chain Bridge

Currently, there are three cross-chain bridges that support fund transfers to the Sui network, namely Wormhole, kriya.finance, and WELLDONE. However, due to the lack of relevant data dashboards, it is not possible to accurately understand the specific scale of cross-chain funds.

2. Overview of Ecological Projects

As of June 14, the Sui official website sui.directory has recorded a total of 66 projects. These projects have all been self-reported by the project parties, many of which are still in the testing phase and have not officially launched yet.

For projects that have launched and issued tokens, we have conducted a brief review. Overall, the ecological projects on Sui have performed poorly after going live. Both projects that are leading DEXs have already experienced a decline, and the social platform SUIA has dropped nearly 81.82%. Suipad has performed relatively well, mainly due to its low pricing at the time of IDO, with an initial fully diluted valuation of (FDV) being only 5 million dollars.

It is worth noting that due to the limited user and capital scale on Sui, some projects like Abyss World chose other networks (such as Polygon) for their IDO instead of the Sui network.

3. Token Release and Demand Analysis

The community is most concerned about the release of Sui's tokens. According to relevant reports from Binance, the total supply of Sui tokens is 10 billion, with an initial circulation of 528 million, accounting for 5.28%.

From May to October 2023, Sui mainly had two types of Token releases: one was the release of Tokens previously issued during the exchange IEO, and the second was the release of part of the Tokens obtained as incentives for staking nodes.

The IEO price is $0.1 per SUI, with a total of 450 million Tokens available for participation in the IEO. 1/13 will be unlocked during the public sale, and then 1/13 will be unlocked each month, completing the unlock in 12 months. Based on this calculation, approximately 34.61 million Tokens will be released each month.

In terms of node staking incentives, there are a total of 1 billion Tokens allocated for this purpose. In the initial 90 epochs (1 epoch = 1 day), a daily reward of 1.11 million SUI Tokens is given, after which the reward decreases by 10% every 90 epochs. Currently, approximately 7.4 billion SUI Tokens are staked in the system, with an average APY of 5.61%.

Based on this data, we can calculate that in the first three months after the launch, the monthly Token circulation increased by approximately 67.94 million, accounting for 0.67% of the total Token supply, equivalent to a market value of about 47.55 million USD. From the 4th to the 6th month, the monthly increase was approximately 64.61 million, accounting for 0.64% of the total Token supply, equivalent to a market value of about 45.22 million USD.

In November 2023, six months after the launch of Sui, a large amount of unlocking will take place. On that day, more than 1 billion Tokens will be unlocked, which will double the number of circulating Tokens.

From the demand side, based on the aforementioned on-chain data and ecological project analysis, Sui is currently experiencing low trading activity, with few users, and there is no significant demand for SUI Token in the short term.

4. Comparison with Aptos Token Release Model

The total supply of Aptos Tokens (excluding the staking incentive portion) is 1 billion, with an initial circulation of 130 million, accounting for 13%. In the first year after launch, 4.54 million tokens held by the community and the foundation will be unlocked each month, accounting for 0.45% of the total token supply, equivalent to a market value of about 28 million USD.

Starting from the second year, in addition to the portions released by the community and the foundation, there will be monthly releases for core contributors and investors. From the 13th to the 18th month, 20 million Tokens will be released each month, accounting for 2% of the total token supply; from the 19th to the 50th month, 6.75 million Tokens will be released each month, accounting for 0.67% of the total token supply.

In addition, Aptos has node staking incentives. Currently, a total of 860 million APT tokens are in a staking state, accounting for nearly 86%. Aptos has been online for about 8 months, with monthly staking incentives of approximately 4.9 million tokens, accounting for 0.49% of the total token supply.

In contrast, both Sui and Aptos belong to a low circulation, high inflation token model. However, Sui's initial circulation is about 50% lower than that of Aptos, with a higher monthly token unlock amount in the first 6 months, 50% more than Aptos. The first large-scale release of Sui occurs 6 months after its launch, while Aptos does so 12 months after launch; Sui adopts a one-time release, with a large number of tokens entering the market on the day of unlock, while Aptos uses a monthly unlock with a buffering period.

Overall, Sui faces greater token supply pressure in the first year compared to Aptos, while Aptos's large supply arrives in the second year.

5. Conclusion

From the perspective of on-chain data and ecological projects, Sui is currently in the cold start phase, with insufficient user numbers and low transaction volume. The project needs to attract users and capital inflow through continuous activities and construction.

However, the Sui team currently seems to be more focused on technical development, including holding hackathons and organizing developer events around the world. Large-scale user incentive measures have not yet been launched.

At the same time, in the current bearish market environment, funds and users are becoming more conservative. On the other hand, the continuous development of Ethereum's Layer 2 networks has made it easier and safer for existing users to transfer funds from Ethereum to Layer 2 networks, thereby attracting a large amount of on-site funds. These factors increase the difficulty for Sui to attract funds and users.

From the perspective of the token economic model, compared to Aptos, which is also a Move-based public chain, Sui's token release pressure is concentrated in the first year. In the case of insufficient demand, such a large token supply may lead to significant selling pressure on the SUI token.