Sui (SUI) token’s impressive rally of over 120% in the past month has ignited concerns about insider selling, with allegations that early investors may be cashing out during the surge.
As of 10:13 am UTC on Oct. 14, SUI traded at $2.25, rising more than 16% in the past week, according to data. Despite these bullish gains, suspicions surrounding large-scale token sales by insiders have emerged, raising red flags for retail investors.
$400 Million in Tokens Allegedly Sold by Insiders
Pseudonymous crypto analyst “Light” revealed on X (formerly Twitter) that wallets connected to SUI’s initial coin offering (ICO) have reportedly sold over $400 million worth of tokens during the recent rally. Light suggested that a large foundation wallet may be involved in these sales.
The analyst noted:
“Insiders… have sold $400 million in tokens throughout this run-up, had already begun selling material amounts at much lower prices, and are even accelerating their selling at these more elevated levels.”
When insiders control a significant portion of a token’s circulating supply, large-scale sales can create downward pressure, potentially halting or reversing bullish trends.
Upcoming Token Unlock Could Increase Selling Pressure
Further selling pressure on SUI could emerge soon. On Oct. 23, $114 million worth of tokens (equivalent to 2.32% of the circulating supply) will be unlocked, based on data from Token Unlocks.
Currently, more than 28% of the total SUI supply is unlocked. The token’s allocation breakdown shows:
- 14% designated for investors
- 10% reserved for the Mysten Labs Treasury
- 50% allocated to community reserves
This upcoming unlock could add to the market’s selling pressure, potentially dampening further price growth.
Bullish Momentum vs. Insider Sales: Can SUI’s Rally Last?
Despite these concerns, some analysts believe Sui could maintain its momentum. Year-to-date, the SUI token has surged over 164%, making it one of the top-performing cryptocurrencies in 2023. Optimists see the Sui Network as a potential competitor to Solana, with some speculating it could become a dominant Layer-1 blockchain, according to research firm K33.
However, Light cautioned that insider selling poses risks to retail investors. He warned:
“It does not bring comfort that the people building this ecosystem, the people who arguably know this token’s value best, are unloading hundreds of millions of dollars… into less informed buyers chasing momentum.”
Whether SUI can sustain its rally amid heavy selling remains uncertain, with October’s token unlock looming as a pivotal moment for the asset’s short-term future.
