Should I buy Sui despite the community's criticism?

The Sui that has been speculated since last year has finally launched its token. The secondary market is more concerned about the valuation of Sui token, which can refer to "Sui Token 发售在即，简析估值及 IEO 参与方式". In addition to valuation, Sui also has many interesting things, such as its emphasis on the Chinese market, but the IEO and recent operations have left many Chinese users dissatisfied.

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From the perspective of Sui, which is the project party, Chinese users account for a large proportion. Sui's project party has participated in the Crypto series conference held in Hong Kong before. In addition, Sui's IEO includes OKX, Kucoin, and Bybit, among which OKX and Kucoin account for a large part of SUI's share. This also shows that Sui attaches great importance to the Chinese community. If we carefully observe the few days after the announcement of Sui's IEO, the attention of English-speaking KOLs to it is not high, and there are not many English-speaking users discussing the event. Most of them are posting from the perspective of analyzing its valuation and news promotion. However, the discussion of Sui's IEO in the Chinese community is overwhelming and full of negative emotions. Sui has made a ridiculous move despite attaching great importance to Chinese users.

From the beginning to now, Sui has been a popular star public chain in the Chinese community, a public chain highly valued by users. Most people have also interacted with this project. However, precisely because of its popularity, the project seems to not care about its largest audience - Chinese users. Therefore, Sui announced that there would be no airdrop, and instead would conduct an IEO and introduce a special whitelist mechanism, which has caused dissatisfaction among Chinese users. In addition, there have been many problems in the middle of the IEO announcement, such as email errors and webpage lagging. Let's take a look at these unfriendly actions by Sui for Chinese users.

Sui Introduction

First of all, let me introduce Sui briefly. Sui is a public chain launched by Mysten Labs, aiming to provide better blockchain ecosystem infrastructure for developers. The main members of Mysten Labs met each other when they were working on Libra, a cryptocurrency project initiated by Facebook, which was suspended midway due to resistance from other countries. At that time, they were all committed to building a completely decentralized currency payment infrastructure, but failed. Later, this group of like-minded people came together again and devoted themselves to building a completely decentralized infrastructure, which is also the reason why Mysten Labs launched Sui.

Sui is a permissionless proof-of-stake (PoS) blockchain network that features high performance and horizontal scalability. Sui was designed from the ground up to facilitate instant settlement, providing high throughput, low latency, and low cost. Previously, Mysten Labs CPO Adeniyi Abiodu discussed Sui's vision in an interview, including a closely connected community and a new monetization strategy. Developers can build quality projects and a large user base on Sui by deploying code on a shared infrastructure to a great extent. Adeniyi also revealed that Mysten Labs has established partnerships with some of the world's leading 3A game studios, and the future direction of Sui is likely to be GameFi.

So far, Mysten Labs has completed a total of $336 million in financing, with a16z, Coinbase Ventures, and Lightspeed all participating in the two rounds of public financing. In recent months, the Sui ecosystem has been highly regarded, with good financing and team background. Its Dapp on the wallet has naturally become the first choice for many people to interact with Sui. However, there have been various rumors about the Sui interaction airdrop, until finally (April 10), Mysten Labs co-founder and chief product officer Adeniyi Abiodun publicly stated that Sui has no airdrop and never will. However, in fact, Sui officials have not had a particularly clear attitude towards airdrops in the past six months. Next, let's take a look at Sui's official statements on its airdrops in the past six months.

Sui Airdrop Rumors

Actually, Sui has been emphasizing that there is no airdrop plan. Below are the statements and announcements regarding SUI airdrops made by Sui and its related applications in the past six months:

On October 22, 2022, Sui's official social media posted: "SUI Token is currently not listed or sold anywhere, and there is currently no official plan for airdrops."

On November 4th, 2022, according to an official announcement, the public chain Sui launched a Web3 game preview called Sui Capys on its testnet. Players can buy, trade, breed, and decorate Capys. The official emphasized that Sui Capys is a demonstration specifically designed to incentivize the Sui developer community and cannot be used for airdrop interactions.

On November 17, 2022, Sui Network announced the launch of Sui Testnet Wave 1, which focuses on independent validators. Sui Network officials have previously stated that there are currently no plans for a SUI Token airdrop, and there will be no rewards for interacting with the test network.

On December 20, 2022, the Sui Foundation disclosed the details of the Token community access plan, which will allow Sui community members to purchase SUI Tokens in the early stages of the network. As part of this plan, SUI Tokens will also be provided to those who help test Sui applications or promote Sui adoption on the Sui network before the mainnet launch. Additionally, the Sui Foundation reiterated that there is currently no official plan for a SUI airdrop.

On March 22, 2023, Layer1 blockchain Sui announced that its mainnet will be launched in Q2 of this year. There is currently no official airdrop plan, and they have also launched a series of activities and content called "Wave to Mainnet" to further introduce Sui to the community.

On April 10, 2023, Adeniyi Abiodun, co-founder and Chief Product Officer of Mysten Labs, the development team behind Sui, responded to a tweet from a user regarding "SUI airdrop" by stating: "Stop spreading rumors, there is no SUI airdrop, no plans for it, and there never will be."

However, looking back over the past six months, Sui's official comments on airdrops have not been clear. Words like "current," "temporary," "none," and "official" regarding airdrop plans are not completely negative for users. It wasn't until a few days before the announcement of the IEO that their co-founder released the statement "there will never be a SUI airdrop," which put an end to the speculation. To some extent, the ambiguous words "current," "temporary," and "official" did not affect their interaction experience. The series of statements about airdrops seemed to be a reminder to try out Sui, especially for Chinese users, who have been seeing new Sui interaction tutorials on social media. From the official statements, it seems that Sui is using the non-existent "airdrop plan" for publicity purposes.

Source of image: social media 

Remember that when Sui indicated that there were currently no airdrop plans, some KOLs posted that Sui might be anti-airdrop, but most people did not think this meant that there would be no airdrop. Most people spent a lot of time and cost interacting on the Sui chain. For example, I spent a lot of time on Sui to receive test coins, interact with Dapps, and even stake SUI in the wallet. However, all of this time and effort turned out to be in vain. If I had spent this time on Arbitrum, I could have gained a lot of wealth. In fact, under the star effect of Sui, most users have interacted with the Sui test network and spent months of time and effort, but the fact that there will never be an airdrop has always been a source of dissatisfaction in the community towards Sui.

Source: Social Media

Sui 的 IEO

translates to

Sui's IEO

in English.

IEO and Valuation

Sui's IEO details include: Sui will offer supporters the right to purchase tokens, eligible users for purchase include Capy Holidays competition winners during the first round of testing, members who participated in organizing Builder Houses and other important activities, and some community participants. For ordinary users, they need to join their official Discord and complete KYC verification before February 1, 2023, and can get SUI at a discounted price of 30% of the normal purchase price.

Source: Sui social media

There are three trading platforms that can participate in the Sui IEO: OKX, bybit, and Kucoin.

-Kucoin: 42,307,692.3 SUI; (225 million immediately released 1/13, followed by monthly unlocking of 1/13; whitelist initially released 35 million)

-OKX: 42,307,692.3 SUI; (225 million immediately released 1/13, followed by monthly unlocking of 1/13; initial release of 0.35 billion for whitelist)

-Bybit: 94,000,000 SUI; (0.94 billion immediately released for whitelist)

Total: 178,615,385 SUI.

Both Sui and Aptos are two major public chains developed by former Facebook employees using the Move language in the encryption industry. The market value of SUI is mostly compared with APT. After the last financing, the valuation of APT was about 2 billion US dollars, and the data shows that the current circulating market value is about 2.1 billion US dollars. The initial total supply is 1 billion, and the current circulating supply is 187 million, with a current price of 10.1 US dollars, accounting for about 17% of the circulating volume. The valuation of Sui is 2 billion US dollars, which is similar to the last financing valuation of Aptos. The initial total supply is 10 billion, and the current IEO unlocks 178 million. Compared with Aptos, the price of SUi token will be around 1.06 US dollars, which is 10 times higher than the IEO price (0.1 US dollars). Most people are not satisfied with Sui in the market, but they have different evaluations of its valuation. Most people believe that the price of Sui after IEO will be pulled up very high. One thing to note is that Kucoin stated that the initial circulating supply is expected to be 500 million SUI, which means that there is a difference between the unlocked token amount and the initial circulating supply. What impact will the remaining approximately 322 million SUI have on its price after monthly unlocking?

There is also a question about FTX. FTX invested a total of 102 million US dollars in Mysten Labs' Series B financing, obtaining approximately 570,000 preferred shares and the token subscription rights of about 890 million SUI tokens. Later, Cottonwood Grove Limited (Alameda) and FTX Trading repurchased a total of 519 million SUI token warrants for approximately 173 million and 346 million at a price of $500 each ($1,000 in total).

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As the lead investor, FTX's average cost of investing in Sui Token is very low, about $0.114. After FTX's collapse, Mysten Labs repurchased part of FTX's equity investment and SUI Token warrants in Mysten Labs for $96.3 million in cash, with an average price of $0.185. The financing cost for the remaining part of Sui is between $0.28 to $0.31, so the Sui IEO price is much lower than the financing price, which is good news for participants. However, where can investors find their investment return?

IEO Details Criticized by Community

Sui previously announced that it would notify white-listed users via email, but due to issues with data collection during the evaluation process, the email notification to users has been delayed. Later, it was confirmed that 96,000 white-listed spots would be randomly allocated to 180,000 accounts (in fact, there are over 340,000 users who are eligible for the white-list, but only 180,000 have qualified after the screening process), and those who were selected will be notified via email. For OKX and Kucoin users, KYC is not a big issue, but for Chinese users, KYC on Bybit is extremely difficult to pass. What's even more absurd is that Sui's first batch of emails was sent to users who participated in the Bybit IEO, but there were problems with this process. Some users registered on the form before the IEO and chose OKX or Kucoin instead of Bybit, but they received the first email from Bybit, which means they cannot pass Bybit's KYC and participate in this IEO. This situation may also be a problem with the trading platform, but ultimately, Sui did not do well in the details of the IEO. How could users who confirmed their participation in OKX receive emails from Bybit? This also shows Sui's indifferent attitude towards the IEO.

Source: Social Media

After the email sending mistake incident, the lucky users received a second email indicating that they can fill in their ID and email again on Google Docs. However, it was embarrassing that the email link was unable to open for a short period of time. Slow data collection caused a delay in notification emails, and the poorly designed webpage resulted in the inability to open the link. Sui's attitude towards users in IEO can be described as "chaotic and playful".

KOL's attitude towards Sui (Sui ecosystem and IEO)

BlockBeats interviewed several Chinese crypto community KOLs to get their opinions on Sui's recent actions, including whether they will still invest in SUI under the current sentiment.

1. Why was the Chinese community criticizing Sui when it announced its IEO? Was it because they were dissatisfied with the lack of airdrop, the trading platform it was listed on, or the fact that it still needed to conduct a public offering after its private placement?

Hengxin Capital partner @Woody said that the dissatisfaction of the Chinese community with Sui comes from the protest of the airdrop scammers. If Sui announces an airdrop, the community's attitude towards Sui may be completely different;

KOL @妙蛙种子 believes that it is normal for the community to have opinions, and it cannot be said that it is a problem of the community. Luma is a process of mutual benefit between Luma users and the project party. The cost of Luma is pre-set, and the community pays time, energy, and money to support the project in exchange for future returns. Currently, Sui's model has further increased the community's cost and affected the return, and not conducting IEO through Binance has further reduced the expected income, so the community will naturally have concerns;

KOL @Raccoon Chan 小浣熊 said that the dissatisfaction in the Chinese community is due to the gap between expectations and the reality of airdrops.

KOL @Lsp.eth believes that Sui has broken everyone's expectations for its airdrop and has started a new airdrop model, temporarily called the whitelist model. This is similar to what happened with Hop Witch Detection, where it was not a matter of who was wrong, but rather a matter of expectations not being met. Additionally, Sui's rules are currently very chaotic, and it is referred to as "water drop crowdfunding" by the community. Although the community is currently dissatisfied with Sui, they believe that a price increase will solve everything.

2. Sui has received a lot of attention in China. Have you observed the evaluation of Sui IEO by Kol in the foreign community?

Bulbasaur: The foreign community hasn't paid much attention to SUI's content, which may be related to the project's focus on the Asian and Chinese communities.

Little Raccoon: In the English-speaking community, the response seems to be not much different from that in the Chinese-speaking community.

3. Although there is a lot of criticism in the community, objectively speaking, would you invest or speculate in SUI in IEO or the secondary market?

Woody said he will still participate in the IEO to some extent, but the profits are expected to be small, better than nothing.

Bulbasaur said that it has average skills in the public chain industry and no particular advantages, and it is not expected to participate.

The little raccoon said that it will participate in related investments, but it is not good at investing in new coins with large market values. It's just following the trend and playing with small bets.

Lsp.eth believes that the valuation of Sui is too high and feels that it is very troublesome, whether it is rules or TGE, so he did not participate in SUI's IEO himself. He will take a look at it in the secondary market and mainly participate in the ecosystem in the future, providing some TVL for Sui.

4. Comparison between Aptos and Sui, would you hold APT or SUI for a long time in the future? How do you estimate the market value of Sui?

Woody said that in the long run, he may consider participating in some ecological projects in the medium term.

Bulbasaur stated that it is their habit not to disclose their positions, so no comment will be made;

The little raccoon says that he doesn't know much about Sui at the moment;

Lsp.eth said: "Move still has a chance. Binance has already launched Aptos. I have been mining on Aptos. Sui is currently paying attention to some DeFi projects and wants to continue to follow the price of SUI itself and the development of ecological projects after the mainnet is launched on May 3. Aptos is currently not doing much officially. I don't know if he is lying flat or fishing. Sui is still relatively active, and I won't draw conclusions. I am paying attention to market changes and hope he is the next Solana. We can look forward to it, but not gamble."

Conclusion

With the volatility of cryptocurrencies, the return of the bull market seems to be a distant hope. It's becoming increasingly difficult to speculate on coins, especially after the ARB airdrop. For most retail investors, the ultimate goal is to make a quick profit, and the only hope for early-stage projects is to distribute airdrops. For project teams, if they don't have an airdrop plan after raising a large amount of funds, it will definitely lead to dissatisfaction among users. Of course, whether or not to distribute airdrops is up to the project team, but it's clear that Sui values the Chinese community while making decisions that are completely opposite to the expectations of Chinese users. This is where Sui falls short in terms of understanding and valuing its community.

Actually, airdropping is not a bad mechanism for project parties. Compared with ICO and IEO, airdropping has advantages for projects. Projects will not be sued for violating US securities laws, and some token sales will be regarded as unregistered commodity sales. Many projects that have launched ICOs have potential risks. The project airdrop plan will establish a strong supporter community for the project, which is beneficial to both parties. The project gains a loyal community, and people earn money through airdropping. If a project does not have confidence in its application experience after the airdrop, it needs to consider its own problems. For Sui, which is not well-known in the ecosystem, airdropping is a good promotion method for Sui applications, especially in the Chinese community. Unfortunately, it did not do so.

As for the IEO rules and participation methods of Sui, the so-called Recognition Sale, also known as the "white list mode" in everyone's mouth, is considered by some as another way of airdrop. However, for retail investors, the KYC certification of the trading platform is also a major challenge, which requires some costs. Sui announced that it will randomly allocate 96,000 whitelist qualifications to 180,000 accounts (actually more than 340,000 users have whitelist qualifications, and 180,000 are eligible after testing), and will notify the winners by email. For users participating in the white list mode, not winning the lottery is a double blow without the airdrop.

Sui's IEO platform (OKX, Kucoin, Bybit) does not include Binance, which indirectly suggests that Sui's future user base will mainly focus on the Chinese-speaking region. OKX is easy for retail investors to participate in, while Kucoin and Bybit's KYC is not easy to pass, so the problem with this IEO also lies in this. In addition to the previously mentioned issues such as sending emails to the wrong recipients, this IEO is not very friendly to Chinese users, and it can be inferred that the dissatisfaction of the Chinese community with Sui may continue to ferment in the future.

As for the Sui ecosystem, it is currently not well-developed and there are no high-quality projects deployed on it by developers (reference: What are the projects worth paying attention to in the Sui ecosystem, one of the Move twins). Similarly, the Aptos ecosystem, also a "Move twin", is not doing well either, with few good projects heard of/experienced on Aptos, and there has been little action since the coin was launched. In comparison, Sui is still relatively active, and perhaps its development will surpass Aptos in the future. Of course, for a newly launched chain, it is understandable that there are not many high-quality projects, as their journey has just begun and it takes time to verify. However, returning to the beginning, Sui's vision is to provide high-quality decentralized infrastructure for developers, but in reality, there are not many high-quality developers and projects on Sui, which contradicts Sui's original vision.

Chinese KOLs' attitude towards Sui IEO is to participate lightly and watch the future development of Sui's ecosystem and market value. Users' dissatisfaction with Sui is mostly due to the expectation of airdrops. Although Sui has been criticized by many people, considering the changes in the market, it is still possible to consider holding some SUI and look forward to the launch of Sui's mainnet. It is also hoped that Sui will have better development in the future. As mentioned earlier, it is difficult to determine the price of SUI token solely based on APT benchmarking, but the recent surge in OKB lending data on OKX indicates that despite the criticism, people are still willing to participate in the SUI subscription on trading platforms.

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Source of the image: Ouyi

Overall, there is no airdrop, a unique white list mode, chaotic IEO form filling and KYC, and a focus on GameFi but with many unknown on-chain ecological projects. Sui urgently needs good quality developers and loyal users, and has also missed the most suitable "airdrop plan" to attract users. From the current IEO perspective, there are many participants, "regardless of the criticism, they still have to buy", so after the IEO, how should Sui make up for Chinese users and pull up the price after listing, allowing IEO participants to profit?

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