Key Takeaways
- Blockchain: Sui is a Layer-1 blockchain with an object-centric data model and a transaction-object DAG for tracking state history.
- Scalability: The object-based design allows for parallel transaction processing, enabling substantial horizontal scalability.
- Smart Contracts: The Sui Move language enhances security and data composability within smart contracts.
- User Experience: zkLogin facilitates seamless logins utilizing existing Web2 credentials.
- Storage Management: A dedicated storage fund efficiently manages long-term data storage costs on the blockchain.
Introduction
In the dynamic world of blockchain technology, Sui emerges as a game-changer. Developed by Mysten Labs, Sui positions itself as an exceptionally scalable Layer 1 blockchain and smart-contract platform, ready to make a lasting impact.
Sui aims to address common blockchain challenges by focusing on scalability, secure smart-contract development, and smoother user onboarding. Its object-centric architecture, Sui Move programming language, and ZK-based features such as zkLogin form the basis of a platform designed to improve scalability, developer safety, and user experience.
Behind the scenes
In June 2019, Meta, formerly known as Facebook, revealed its vision for a global payment network through the integration of blockchain technology and a digital wallet. The Diem Association and Novi Finance were established to spearhead these initiatives.
However, both projects encountered significant challenges. Diem succumbed to regulatory hurdles, leading to its closure in January 2022, while Meta later terminated the Novi project without providing a clear explanation.
In the aftermath of these setbacks, two distinct blockchains emerged: Aptos, carrying forward Diem's legacy, and Sui, a groundbreaking creation by Mysten Labs, born from the remnants of Diem.
The project name Sui, (swē in English), comes from the Japanese word for "water". The reference to the water element is reflected in the identity of the blockchain - the tokens are called SUI and MIST - as well as in the visual component of its branding.
The Sui Mainnet went live on May 3, 2023, following Devnet and Testnet phases. The launch opened the network for public use and coincided with exchange support for the native SUI token.
Mysten Labs, the original contributor behind Sui, was founded in 2021 and is headquartered in Palo Alto, California. Its founding team includes former Meta/Novi engineers and researchers with experience in distributed systems, cryptography, and the Move language.
- Evan Cheng, CEO: former Head of Research and Development at Novi and Technical Director of Meta.Earlier he was working 10 years with Apple.
- Adeniyi Abiodun, CPO: Former Head of Product Development at Novi, Meta*. Previously worked at VMware, Oracle, PeerNova, HSBC, JP Morgan.
- Sam Blackshear, CTO: Former Chief Engineer at Novi, with expertise in the Move programming language.
- George Danezis, Chief Scientist: Former researcher at Novi, Meta*. Previously worked at Chainspace, Microsoft.
- Kostas (Konstantinos) Chalkias: Former leading cryptographer at Novi, previously worked at R3, Erybo, Safemarket, NewCrypt.
In the realm of fundraising, Mysten Labs has successfully raised $336 million across two funding rounds since December 2021. Noteworthy investors have included a16z crypto, Binance Labs, Electric Capital, Apollo, Franklin Templeton, and FTX Ventures. Because FTX is no longer active, keep the mention historical rather than implying current backing.
What Makes SUI Stand Out in the Crypto Crowd
At the core of SUI Blockchain's uniqueness is its object-oriented design, setting it apart from the crowd of other blockchain systems. Unlike account-based blockchains that often process transactions through a single sequential path, Sui structures on-chain state around objects. Transactions that touch independent objects can be processed in parallel, which helps reduce latency and improve horizontal scalability.
This innovative architecture permits many transactions to bypass the full consensus cycle. Many transactions involving only owned objects can avoid the full consensus path, while transactions involving shared objects use consensus.
For transactions that require consensus, Sui uses Mysticeti, a BFT consensus protocol designed to reduce latency while supporting high throughput and parallel execution. It is engineered to significantly reduce latency and enhance throughput, hence positioning Sui at the forefront of blockchain technology.
In this way, Sui is designed for horizontal scalability and low-latency execution, especially when transactions can be processed independently.
With Sui's parallel system, scalability becomes virtually limitless as more validators join the network, each determining the number of transaction lanes based on their machine power. It is noteworthy, that some types of blockchains are heavily tied to software and need to upgrade their core or make soft-forks to achieve better performance.
Beyond that, Sui provides an innovative mechanism, Storage Fund, for solving the storage cost issue that is a headache for many blockchains. It transforms block space into a commodity, allocates fees for perpetual data storage, adjusting validator rewards accordingly.
This ingenious mechanism prevents a negative externality, where current users burden future users with unpaid storage costs. Sui's design promotes responsible data storage, ensuring the network's long-term health.
When it comes to smart contracts, a standout feature in the SUI Blockchain's toolkit is its revolutionary take on smart contracts, powered by the SUI Move Language. Unlike run-of-the-mill smart contract languages, the SUI Move Language puts security front and center. What's more, it brings data composability, empowering developers to handle data packages, including structs, with enhanced ease and flexibility. This opens doors to crafting advanced and secure smart contracts tailored for a diverse range of real-world scenarios.
Equally important part of any project's ecosystem is the pricing of gas for performing transactions. In many cases, impacting the cost of fees is determined by network capacity.
Sui fees account for both computation and storage. A transaction pays for execution and for the long-term cost of storing the objects it creates or mutates, with the reference gas price helping make computation fees more predictable. At the beginning of each epoch, a validator-wide survey establishes the reference gas price. Validators are prompted to adhere to this reference price, driven by a tallying rule and the incentivized stake reward distribution rule.
This incentivization framework fosters a competitive environment, promoting equitable gas prices and fostering alignment of interests among SUI token holders, validators, and users. It ensures a harmonious ecosystem where fair practices are encouraged and benefits are distributed in a manner that propels the well-being of all stakeholders.
To improve the user experience and address the long-standing problem of mass adoption of cryptocurrencies, Sui has introduced a seamless registration process solution - zkLogin.
Private keys have long been a barrier to blockchain adoption, requiring users to save and carefully manage them. zkLogin changes the paradigm by providing secure access to dApps via Web2 credentials, eliminating the need to do so.
Developers can use zkLogin to let users access Sui apps with familiar OAuth credentials, such as Google, Facebook, Twitch, Slack, Apple, Microsoft, and other supported OpenID providers.
Based on Zero Knowledge Proof technology, zkLogin allows one party to verify the truth of an assertion without revealing unnecessary details. Through a combination of zk-SNARKs and JSON Web Tokens, users are able to confirm their identity without disclosing real login credentials.
SUI Tokenomics
The Sui economic model serves as the cornerstone for aligning the incentives of the various participants involved in the dynamic ecosystem and revolves around three key players: users, SUI token holders, and validators, each of whom plays a key role in the system.
Sui uses delegated proof of stake for validator selection, staking, and rewards, while consensus handles the ordering and execution path for transactions that require it.
Importantly, this model is designed to blend seamlessly with Sui's engineering design, creating synergies to ensure the ecosystem operates efficiently. The integration of these elements emphasizes Sui's commitment to creating a balanced and stimulating environment for its participants.
The maximum supply of SUI tokens is capped at 10 billion.
As of the next CMS update, avoid hardcoding circulating supply unless you plan to update it regularly. The maximum SUI supply remains capped at 10 billion, while circulating supply changes according to the token release schedule.
Inflation and deflation are terms that regularly come up in the realm of cryptocurrency discussions. Both of these terms are related to how ecosystem participants are incentivized to support the cryptocurrency network. While inflation can motivate miners, deflation has its impact on coin holders. Understanding these concepts helps predict how cryptocurrency will evolve and sustain in the future.
The balance of inflation or deflation in the ecosystem depends on the delicate balance between expanding token supply and network activity. Sui takes a specific approach with a limited token supply and a transparent unlocking schedule to increase predictability. This strategy aims to ensure stability and transparency of market dynamics.
At the time of Mainnet Sui's launch, about 5% of all tokens were in circulation. As shown in the graph, the process of unlocking tokens to maintain the network, follows a set timeline. The project team noted that the schedule could be changed if needed to support the balance of the network.
The native SUI token serves four main roles on the network: staking, gas fee payment, utility across applications, and governance participation.
1. Gas fee - every network operation conducted on the platform necessitates gas fees, and these fees serve as rewards for network participants and prevent spam attacks.
2. Staking - Token holders participate in securing the network, being rewarded for participation.
3. Maintaining liquidity on the chain - SUI tokens are utilized by liquidity providers for supporting DeFi protocols.
4. Participation in governance - token holders can participate in voting for future projects or changes to the SUI blockchain.
5. Storage Fund - compensation mechanism for blockchain data storage.
MIST is not a separate token; it is the smallest denomination of SUI. One SUI equals one billion MIST.
Stablecoins on SUI
Stablecoins are types of cryptocurrencies that are designed to maintain a stable value, usually pegged to the US dollar. They are fundamental to any healthy DeFi ecosystem, bringing stability and low volatility, hence allowing a wide array of financial activities to take place. According to DefiLlama, stablecoin supply on Sui has grown since the article’s last update and was around $530M in late April 2026. Because this metric changes frequently, either update it at publication time or phrase it as ‘hundreds of millions of dollars in stablecoin supply.
Native USDC
In 2024, native USDC launched on Sui, improving stablecoin liquidity and reducing reliance on bridged assets. Circle’s Cross-Chain Transfer Protocol also expanded Sui’s interoperability with other supported chains. This will enhance DeFi services on the chain, increase liquidity and capital efficiency, as well as make it safer for the users. The Cross-Chain Transfer Protocol will also support seamless USDC transfers across the supported blockchains.
AUSD
AUSD, issued by Agora, was the other stablecoin that found a home on Sui. It serves as an alternative choice for users seeking price stability and further stablecoin diversity within the Sui ecosystem.
FDUSD
FDUSD is a First Digital Labs-issued stablecoin, that extended its offerings to Sui, marking its first availability outside of Ethereum and BNB Chain. Backed 1:1 with the US dollar and held in reserves in regulated financial institutions, FDUSD brings a clear path as a stablecoin option for Sui customers.
USDY
USDY, powered by Ondo Finance and backed with short-term US Treasuries and bank demand deposits, brings to Sui yet another flavor of a stablecoin. Being available as native asset on Sui, it allows users to generate yield while keeping their environment price-stable. This is, therefore, ideal for those seeking passive income with a stable store of value.
USDT (Tether)
USDT is one of the oldest and most widely used stablecoins globally. If kept, verify the current form of USDT liquidity on Sui before publishing, and avoid implying that all USDT on Sui is native unless confirmed by an official Tether or Sui source.
Roadmap
Sui’s roadmap has moved beyond the early mainnet phase and is now focused on improving developer infrastructure, application performance, and ecosystem usability. For builders, one of the most important updates is the shift away from the original JSON-RPC API toward newer RPC options.
Sui’s JSON-RPC API is now deprecated, and developers are expected to migrate to gRPC or GraphQL RPC by July 2026. This is especially relevant for wallets, DeFi applications, indexers, analytics tools, and infrastructure providers that rely on stable, production-grade access to Sui network data.
The move to gRPC and GraphQL RPC should make it easier for developers to query Sui data, build more efficient applications, and support more scalable infrastructure. For users, these changes are less visible, but they matter because better developer tooling can improve app reliability, wallet integrations, and the overall experience of using the Sui ecosystem.
Beyond RPC infrastructure, Sui continues to focus on areas such as low-latency execution, object-based application design, zkLogin, stablecoin liquidity, and tools that make it easier for developers to build consumer-ready Web3 products. Rather than treating Sui as a finished product, it is better to view the network as an actively evolving Layer-1 ecosystem with ongoing technical upgrades.
Final Thoughts
The Sui team has confidently entered the industry with strong investor support. Although the novelty of the technology and the new Sui Move language adoption can be a stumbling block, the team is working on minimizing obstacles for future developers by ensuring a smooth onboarding process.
Sui's architecture positions it as an ideal hub for DeFi, gaming, and payment protocols, thriving on straightforward transactions. What's more, Sui's network can scale horizontally on demand, keeping those transaction costs comfortably low. Therefore, Sui emerges as a powerhouse, ready to reshape the landscape for user-friendly, efficient, and scalable blockchain solutions.
The project's success depends largely on meeting expectations and laying a solid foundation for ecosystem growth, ensuring the widespread adoption of blockchain applications. Sui’s long-term adoption will depend on whether developers continue to build useful applications around its object model, low-latency execution, stablecoin liquidity, and user-facing features such as zkLogin.
The information provided by DAIC, including but not limited to research, analysis, data, or other content, is offered solely for informational purposes and does not constitute investment advice, financial advice, trading advice, or any other type of advice. DAIC does not recommend the purchase, sale, or holding of any cryptocurrency or other investment.
