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Misconceptions Cleared by Sui Network Regarding Token Supply

May 5, 2024

In response to common misunderstandings about its token supply, Sui Network, a layer-1 decentralized platform, has addressed and corrected these misconceptions. The platform refuted criticisms related to tokenomics, particularly focusing on token distribution and founder control issues.

Sui Network assures that its token economics are well-structured, with tokens managed by reputable third-party custodians. Tokens are released based on a predetermined emission schedule and are open to the public. The foundation clarifies that founders do not have authority over the treasury or tokens allocated to investors, including the community reserve.

Feedback from Sui Network indicates that the Sui Foundation oversees the primary wallet containing locked tokens, which are released under specific conditions to benefit the ecosystem. These allocations support various projects such as Move programming language development, network security enhancements, hackathons, and developer grants.

Sui Network also elaborated on the distribution of staking rewards circulating within the system. These rewards consist of stake derivatives and network commissions, all of which are returned to the community, maintaining balance and fairness within Sui's economic model.

Despite clarifications from Sui Network, concerns expressed by Justin Bons from Cyber Capital regarding the founding team's token holdings raised worries about centralization risks. Bons called for increased transparency and accountability from the network's management, which Sui addressed subsequently.

Sui Network disputes claims of lack of transparency by indicating that all tokens, whether distributed or not, are managed in accordance with legal standards by reputable custodial services like BitGo, Anchorage, and Coinbase Prime.

In response to challenges on transparency, Bons emphasized the importance of accurately representing allocated stake status and demonstrating that founders cannot manipulate or access these tokens. Bons asserted that true transparency demands clear evidence of securely held tokens that are beyond manipulation.

In September 2023, Sui Network simplified Web3 logins for users on its apps with Zero Knowledge login (zkLogin), enabling login through Google, Facebook, and Twitch details. The platform is known for its high transaction capacity and low fees since its launch, establishing a reputation for managing high transaction volumes at minimal costs.

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