Sui denies $400 million insider trading claims, says sales came from infrastructure partner

Sui Foundation, the non-profit organization behind the blockchain and Layer 1 ecosystem, has denied allegations of insiders selling $400 million worth of the network’s native token , SUI, since the asset began its remarkable manifestation.

According to a tweet from the foundation, the wallet address involved in the sales likely belongs to an infrastructure partner, and the token releases align with Sui’s lock-in schedule.

Allegations of $400M SUI Insider Trading

On October 14, pseudonymous crypto trader and analyst Lightcrypto took to X to describe a “puzzling” event they had noticed in recent weeks: the dramatic spike in SUI. Lightcrypto questioned the basis of the increase from a risk-reward perspective, insisting that the belief that SUI can follow in the footsteps of Solana (SOL) is no longer sustainable.

The crypto analyst further questioned whether SUI had shown a quarter of Solana’s potential, even though the coin was trading at a fully diluted valuation (FDV) of $23 billion at the time, a quarter of the valuation from Solana.

CoinMarketCap data shows that Sui’s FDV has fallen to $21.33 billion at the time of writing. The asset is up 96% in the last 30 days and about 10% in the past week. However, the insider trading allegations sent the coin down 5% in the last 24 hours to $2.13.

Lightcrypto believes that Sui’s rally is the result of the crypto market having no winners and has found one for terrible reasons. According to the trader, experts, including a large foundation portfolio, have sold $400 million in SUI throughout the surge. They started downloading the tokens at much lower prices and have increased their sales with the price increase.

“It brings no comfort that the people building this ecosystem, the people who probably know the value of this token best, are offloading hundreds of millions of dollars of the token to less informed buyers chasing momentum,” Lightcrypto added.

Sales of SUI by Compliant Partner

The Sui Foundation insists that no insider, employee or investor of SUI, including those of its main contributor, Mysten Labs, has engaged in any preemptive selling of the coin or violation of its supply schedule.

However, since Lightcrypto did not identify the address of the wallet that made the sales, it is believed that a partner of the foundation is carrying out the actions. In particular, the foundation monitors and enforces the supply schedule, which is enforced by qualified custodians.

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