The Sui Foundation is accused of misreporting the circulating supply of the native token SUI, which although the team denied is under investigation by the Director of the Financial Supervisory Service in South Korea, Lee Bok-Hyeon.
The value of the SUI coin dropped over 5 percent in the past 24 hours to trade around 37 cents on Wednesday with a considerable trading volume of about $95 million.
Sui (SUI) network, a vibrant layer one blockchain with over $59 million in total value locked (TVL) that was developed by former Meta employees who worked on the Diem project, has faced notable scrutiny from the crypto community over allegations of unreported token inflation.
Notably, the Sui Foundation is reportedly under investigation by the director of the South Korean Financial Supervisory Service, Lee Bok-Hyeon for ostensibly manipulating the SUI token supply through staking or unfair disclosure.
However, the Sui Foundation has vehemently denied the allegation and highlighted that all the SUI tokenomics are publicly available and the team is committed to working with the regulators for responsible and sustainable supply.
The Sui Foundation wants to address unfounded and materially false statements surrounding the supply of SUI tokens. Contrary to recent conjecture, there has never been any sale of SUI tokens by the Foundation after the initial Community Access Program (CAP) distributions.
The foundation through the spokesperson further added saying;
The Sui Foundation has and remains committed to cooperating with DAXA and its member exchanges in the spirit of full compliance and transparency. The circulating supply schedule displayed in the Sui Foundation public website and available through the public API endpoints is accurate.
The Sui team has however been redirecting a notable amount of SUI from the external market towards its ecosystem in a bid to spur growth. Last week, the Sui network announced that a total of 157 million SUI coins will be used to fuel growth in the ecosystem. Moreover, the SUI team announced earlier this week that 15 projects have received $1.06 million to help in the mainstream adoption of SUI and create value for the community.
Closer Look at Sui Network and the Market Outlook
Following the allegations, the value of the SUI coin dropped by more than 5 percent in the past 24 hours to trade around 37 cents on Wednesday. According to our latest market data, the SUI network had a total market capitalization of about $324 million and a 24-hour average traded volume of approximately $95 million.
Notably, the SUI network has recorded steady growth in the staked tokens, which amounted to about 154 million as of reporting time. Some of the notable DeFi projects on the Sui network include Cetus, a decentralized exchange with a TVL of about $19 million, and NAVI protocol, a lending platform with $10 million locked.
The Sui Foundation has set a long-term perspective on the SUI token unlocks in a bid to keep the ecosystem healthy from market dumps. For instance, with the upcoming 7 million SUI token unlock worth about $2.64 million, about 8 percent of the total supply will be unlocked with 37 percent still locked.
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