The native token of the Sui blockchain, SUI, recently hit an all-time low, dropping to $0.367, marking a 5.5% decrease in 24 hours. It is down 8.7% over the past week. The Sui Foundation has faced allegations of manipulating the SUI token supply, with claims that it exploited locked-up Sui coin reserves through staking to generate profits while increasing the circulating supply, contributing to the coin’s price drop after Terra Collapse South Korean regulators are taking prompt action to avert a FUD situation in the market.
SUI Coin Accused of Fraud
Shedding some light on the controversy, representative Min Byeong-deok of the Democratic Party of Korea alleged that the Foundation’s actions had caused dissatisfaction among investors, as SUI’s price fell 67.1% in five months. In the doctrine, Min criticized the Digital Asset eXchange Alliance (DAXA) for not addressing the price decline, comparing it to “leaving the fish to the cat.” He claimed that the Foundation profited from staking coins that shouldn’t have been in circulation and sold the coins received as interest on the market.
SUI Foundation Denied Such Claims
The Sui Foundation refuted the allegations in response, stating they are “unfounded and materially false.” They maintain that the Foundation has not sold SUI tokens after the initial Community Access Program (CAP) distributions. The South Korean Financial Supervisory Service (FSS) chairman has indicated that the regulator may inspect DAXA if allegations of manipulation are confirmed.
The Sui Foundation emphasized that the circulating supply schedule displayed on its website is accurate and has not been altered. The Sui blockchain was developed by technology leaders from Meta, known for the Libra Blockchain and Move Programming language, and is supported by respected experts in distributed systems, programming languages, and cryptography.
The South Korean Financial Supervisory Service (FSS) is considering an inspection if allegations of manipulation and unfair disclosure are proven. Furthermore, Director Lee has also confirmed that the FSS stands ready to work closely with relevant authorities and will take decisive action if any evidence of manipulation or fraud involving Sui Coin comes to light.
This situation unfolds as South Korea works to regulate its cryptocurrency market and prevent illegal activities following the collapse of the Terra ecosystem last year.
Impact on SUI
The SUI token has seen a negative impact and hit a new all-time low of $0.36 after experiencing a significant decline from its peak of $1.50 in May, marking a 76% drop in 167 days. Interestingly, despite the surge in total value locked (TVL) to a new all-time high of $59 million, the token price has not responded positively. Despite the circulating news of fraud, SUI Foundation has awarded over $1 million in grants to more than 15 projects, concerns about transparency persist.
