- The Sui Foundation has robustly denied allegations by an anonymous commentator, DeFiSquared, that it had unlocked and sold staked SUI rewards on the Binance.
- DeFiSquared claimed that the Foundation transferred SUI tokens from locked and non-circulating stakes to Binance multiple times, and inflated the SUI token supply by about 20% monthly for non-foundation token holders.
- The Sui Foundation responded by insisting they had not engaged in such transactions and has pledged to release a “detailed projection” of the token release schedule soon.
In a recent turn of events, the Sui Foundation, developers behind the innovative Sui network and its native SUI token, have come forward to staunchly deny allegations that they were involved in unlocking and selling staked SUI rewards on the cryptocurrency exchange Binance.
These accusations were raised by a pseudonymous crypto commentator DeFiSquared on Twitter, who claimed that tokens held in the Sui Foundation’s wallet address were transferred to multiple addresses, ultimately ending up on Binance. DeFiSquared pointed out a recurring pattern, suggesting that SUI tokens had been repeatedly transferred and potentially dumped on the platform.
Allegations and Response
DeFiSquared accused the foundation of distributing rewards from locked and non-circulating staked SUI to Binance, with 3.125 million out of a total 27 million SUI staking rewards allegedly transferred from the Sui Foundation’s wallet address “0x341f” to three different addresses, before making their way to Binance.
He further claimed that the Sui Foundation inflated the supply of the SUI token by approximately 20% monthly for non-foundation token holders, drawing comparisons to the hyperinflation rate of the Venezuelan Bolivar in 2022. Furthermore, DeFiSquared criticized the Sui Foundation for failing to publish a separate emissions chart from Binance’s launchpad, putting its legitimacy into question.
In a swift response to these allegations, the Sui Foundation released a series of Twitter posts insisting they had not engaged in any such transactions involving staking rewards or other tokens from locked or non-circulating staked SUI on Binance or any other platform. The foundation further highlighted that all insider token allocations were compliant with lockup agreements and other transfer restrictions, a measure in place to counter unauthorized transfer of tokens.
Transparency in Token Management
In light of these allegations, the Sui Foundation has pledged to release a “detailed projection” of the token release schedule soon, reaffirming their commitment to uphold transparency in token management. This move is expected to further assuage the concerns raised by DeFiSquared.
As the situation unraveled, it drew significant attention to the importance of transparency in token management. With an increasing number of participants entering the crypto space, it is crucial for foundations and networks to maintain transparent operations, reinforcing trust amongst their investors and stakeholders.
At the time of writing, the SUI token has a market capitalization of $410 million, with approximately 604 million tokens in circulation, according to CoinMarketCap. SUI is currently trading at $0.67, reflecting a 6.67% drop in the past 24 hours.
The Road Ahead
While the allegations have stirred controversy in the crypto community, it’s worth noting that Sui Network remains a strong player in the decentralized proof-of-stake blockchain arena. The network, designed to offer high transaction throughput with low fees, continues to build on its unique value proposition, despite the current storm. Interestingly, the Sui Foundation has scheduled the next unlock of 61 million tokens (equivalent to $43 million) for June 3, signaling confidence in their operations amidst the controversy.
In a separate but noteworthy development, the Sui Foundation awarded $500,000 to smart-contract audit firm CertiK for discovering a potential attack vector on the Sui network, reinforcing its commitment to network security.
