The team behind the Sui network and its native SUI token has taken to Twitter to deny allegations of selling locked staking rewards on Binance. Word on the street is that the team moved a huge amount of locked staking rewards and dumped them on Binance to cash in.
Sui Foundation Denies Selling Locked Staking Rewards
Pump and dump schemes have become very common in the crypto world. According to a report by Chainalysis, 24% of tokens launched in 2022 that were analyzed saw a price decline in the first week indicative of possible pump-and-dump activity.
According to the foundation, the Sui Foundation has not sold staking rewards or any other tokens from locked and non-circulating staked SUI on Binance or any other exchange.
“All insider token allocations remain subject to and compliant with their lock-ups and other restrictions on transfer,” said the statement.
The Origin Of The Claims
A rumor started circulating on Twitter on Thursday that the Sui Foundation was unlocking and dumping locked staking rewards on Binance. According to a Twitter thread by @DefiSquared, a popular crypto trader and commentator, “locked” and “non-circulating” staked SUI were manipulated by the foundation. The party behind the account claims that the SUI foundation has nearly 3 billion non-circulating and locked SUI staked, which is six times more than the entire circulating supply.
DefiSquared also goes on to provide on-chain data showing how millions of SUI rewards were transferred. These tokens were split many times, with most of them ending on Binance. An example was a transfer of 2,500,000 SUI rewards from 0x341f to 0x209f on May 31st. However, The Sui Foundation has since referred to the transaction as a payment subject to a contractual lockup.
The specific transaction referenced was a payment subject to a contractual lockup.https://t.co/ViYxQoJMos
— Sui Foundation (@SuiFoundation) June 27, 2023
Sui adopts a proof-of-stake consensus mechanism for its blockchain. Its mainnet went officially live on May 3, allowing users to stake their Sui tokens to participate in its proof-of-stake mechanism in exchange for more SUI.
The Sui Foundation is yet to publish a token release schedule, more than two months after going live on its mainnet. According to DefiSquared, the supply is actually increasing every day, although the data CoinMarketCap receives shows emissions just once a month.
This comes down to a rough 20% inflation for non-foundation SUI token holders. To address concerns and speculations, the Foundation will publish an official projection of the SUI token vesting and distribution schedule very soon.
SUI token is currently down more than 14% in a 7-day timeframe. A subsequent release of 61 million tokens is slated to take place on June 3rd.
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