Fundamental Problems of SUI

Among the new generation projects, SUI is one of my favorite blockchains that is created by former developers of Facebook's project, a.k.a, Diem. The team uses Move coding language to build a fast and scalable blockchain alternative for the ecosystem. Basically, as both Aptos' and SUI's developer teams are former Diem devs, we can easily put forward that SUI and Aptos are cousins in nature.

The debut of SUI was sensational not because it shocked the market with the astonishing amount of money that the team distributed to the community but because the team wasted their potential by relying on the Centralized Exchanges, Launchpool on Binance, Community Access Program on Kucoin, OKX and Bybit, and in the end, community members had a consensus to punish the team: No Airdrop; No Community!.

Two major concerns to be considered: Community people and Token Unlocks 🔒

Community via Airdrops

Airdrops are vital if you are creating a brand new product or a chain because airdropped token / coin brings people to claim it, check the existing projects on the chain, have some transactions, invest in NFTs to hit the jackpot as early investors etc. Yet, once there is no airdrop, There is no community.

Sad to say but there are hardly any users in the chain to add value. I feel alone over there 😅

Unfortunately, once again, I am approaching emotionally to a chain. However, I also want to criticize it realistically. The project ruined its potential. The team had a $336m investment during the funding rounds.

CoinCarp

Considering the potential, the team still has not come up with a sustainable solution.

There is clearly no community to build a healthy ecosystem.

Token Unlocks

Let's say the community will be built with incentives, additional bounty programs so on and so forth. There is a huge threat that is even more serious than the lack of authentic members of SUI community. The token unlocks look horrible starting from October - November 2023.

Just have a look at it on Token Unlocks App

We only have 7 percent of the total supply so far.

It might not be too serious if the supply is increasing steadily and linearly in time. However, there is a huge imbalance in terms of token inflation.

For some time, the total supply is only limited to a max of 9% but then it reaches up to 25% in a weak.

This is what it looks like on November 2. Yet, these good days do not go too long.

Unfortunately, there will be a huge dumping of tokens on the markets. The amount will be more than its existing circulation supply.

Just be careful about the date and the total supply that will be unlocked.

The circulation supply will go up almost 1.5x in a week!

The risk is not the allocation of Sui foundation or Mysten Labs Treasury themselves, actually, the point is that the early investors such as Series A, Series B and Early Contributors will have a massive amount of SUI to make use of.

As of that day, the circulation and the unlocks will start happening gradually.

Some people are worried about monthly unlocks which do not exceed %0.7 while there is an upcoming risk of massive dumping on the market.

Personally, I'm worried about the well-being of my investment considering the risk of early investors' market sales when they receive their tokens. It is actually sad to witness that a project with a high potential falls into the trap of over relience on the central exchanges. The risk that they took may be the biggest problem that was inherently born the very first time.

Posted Using LeoFinance Alpha