Grayscale recently announced the launch of two small cryptocurrency funds: SUI and TAO. Today Grayscale also released a report on SUI to market to their investors. SUI has also seen a 30% increase in the past 30 days. Good performance. The following is a summary of the report contents :
Table of Contents
ToggleSui’s position in the cryptocurrency space
Grayscale said that Sui, as a Layer 1 blockchain, originated from Facebook’s now-terminated Diem project and has become an important player in the cryptocurrency field of smart contract platforms. As of July 31, 2024, Sui stands out for its efficient throughput and low transaction costs, which are achieved without relying on additional scaling layers. This makes Sui one of the most advanced third-generation blockchains designed to solve the scalability, interoperability and sustainability issues faced by first- and second-generation blockchains such as Bitcoin and Ethereum.
A new era of blockchain technology
Although first-generation blockchains such as Bitcoin focused on simple peer-to-peer transactions and second-generation platforms such as Ethereum introduced smart contracts, they still have difficulties with scalability and require additional layers to optimize performance. Sui represents a new wave of blockchain that delivers a superior developer and user experience through its advanced design choices. This is primarily achieved through its unique object-oriented programming language, Sui Move, which allows transactions to be processed in parallel, eliminating the bottlenecks of earlier blockchains, thereby simplifying operations and increasing efficiency.
Sui’s Competitive Advantage: Parallel Trade Execution
A key differentiator of Sui is its ability to execute transactions in parallel, whereas traditional blockchains process transactions sequentially. This capability significantly reduces execution time and improves network efficiency. In addition, Sui supports offline transactions and introduces programmed randomness to enhance network security. These features make Sui an ideal platform for next-generation decentralized applications (dApps) with powerful performance and efficiency.
( Compiled by ABMedia| Comparison of parallel execution public chains: Aptos, Sui, Linera, Fuel )
SUI Token: The Backbone of the Ecosystem
The SUI token is the native currency of the Sui network and plays a key role in the entire ecosystem. It is used to power dApps, pay transaction and storage fees, provide network security through staking, and facilitate future governance. As of July 31, 2024, SUI tokens represent ownership within the ecosystem and become an important part of Sui infrastructure.
Sui Move: Simplifying smart contract development
Sui's technical foundation is built on Rust and Sui Move, a programming language that simplifies the creation and deployment of scalable smart contracts. Unlike Ethereum’s Solidity, Sui Move is designed around programmable objects that are stored directly on the chain, allowing for instant confirmation and finalization of transactions. This approach not only increases speed, but also improves the overall user experience by reducing latency and transaction costs.
Practical applications: from micropayments to games
Sui’s innovative approach is not limited to blockchain technology but is also applied to real-world scenarios. Its high capacity of 120,000 transactions per second (as of July 31, 2024) makes Sui the fastest and most scalable blockchain platform, surpassing even its Web 2.0 counterparts like Visa, which later It processes approximately 65,000 transactions per second.
One notable application is the dApp Stashed, which allows users to interact with Sui's blockchain capabilities through traditional Web 2.0 accounts such as Google or Twitch. This integration simplifies the user experience and makes asset transfer as easy as sharing a link or using Venmo. By lowering the barrier to entry, Stashed has the potential to drive mass adoption of blockchain technology.
Rapid growth and diverse applications of the ecosystem
Sui's ecosystem is growing rapidly, supporting a variety of applications in various fields:
- Decentralized Finance (DeFi): includes automated market makers, lending platforms and asset management tools.
- Web 3.0: Covering decentralized physical infrastructure applications, privacy-focused web browsers, and open-architecture video games.
- Non-fungible tokens (NFTs): Provide casting platform, market and community interaction tools.
As of July 31, 2024, Sui's total locked value (TVL) reached US$830 million, the market value was approximately US$1.8 billion, and the TVL/market value ratio was 2.16, one of the highest among similar projects. This ratio suggests that Sui may be undervalued compared to its competitors and has significant growth potential.
Sui Challenges and Investment Risks
Although Sui has promising technology and competitive advantages, it still faces multiple challenges:
- Fierce competition: Sui competes with other smart contract blockchains such as Ethereum, Solana, Near, Aptos, and Avalanche, which are all vying for dominance in the same space.
- Economic Viability: While Sui’s low transaction fees are attractive to end users, the network has yet to generate significant revenue compared to competitors.
- Centralization and Token Unlocking: As of July 31, 2024, only 26% of Sui’s token supply is in circulation, and the remaining tokens will be gradually unlocked before 2030, which may lead to market dilution, but also hints at the future Growth potential.
Sui’s innovative approach to blockchain technology makes it a strong contender in the cryptocurrency space of smart contract platforms. With its advanced parallel transaction execution, robust ecosystem, and practical applications, Sui has the potential to capture market share from established players such as Ethereum. However, as this emerging technology continues to develop and evolve, investors should remain alert to the associated challenges and risks.
