Sui Network refutes criticism of tokenomics and distribution

The Sui Network (SUI) has clarified misconceptions about its token offering. In a post on X, the layer-1 blockchain has refuted criticism of the tokenomics surrounding the distribution and control of its SUI token.

In the statement holds Sui insists its tokenomics are sound and that it uses reputable third parties to manage its token storage. It claims that tokens are released on a predetermined schedule, that they are publicly accessible, and that the founders cannot control the treasury or the tokens allocated to investors, including the community reserve.

Community response and external criticism

Sui said the Sui Foundation manages the primary wallet that holds locked tokens, which are released under specific conditions. The token releases support various projects, including the development of the Move programming language, network security improvements, hackathons, and developer grants.

Sui explained that the staking rewards consist of stake derivatives and network commissions, all of which return to the community.

However, Cyber ​​Capital’s Justin Bons has expressed reservations about the Sui team’s token holdings. Bons suggested that the founders may control a substantial portion of the staked tokens, which poses a risk of centralization, and he called for more transparency and accountability from Sui.

On the other hand, Sui disputes Bons’ claims and said it has revealed that all tokens, whether distributed or not, are managed in accordance with legal and regulatory standards monitored by reputable custodian services such as BitGo, Anchorage and Coinbase Prime .

Bons challenged Sui’s claims of transparency by urging them to show that the founders cannot move or access the allocated tokens.

Bons suggested that misrepresenting token status undermines claims of transparency and that true transparency requires clear evidence that the allocated tokens are held securely and cannot be tampered with.

In September 2023, the Sui Network simplified Web3 logins for users on its apps with zero knowledge login via Google, Facebook and Twitch. Since its launch, it has built a reputation for handling high transaction volumes while maintaining low fees.