$400M SUI Sale Sparks Insider Trading Allegations, Sui Foundation Responds

Key Takeaways

• An influencer has accused the Sui Foundation of insider trading and dumping $400 million into the market.
• The blockchain company denied insider trading allegations.
• Sui Foundation linked the wallet to an infrastructure partner.

The Sui Foundation faces fresh scrutiny following the sale of $400 million in SUI tokens.

The platform has been accused of insider trading, a claim the Sui Foundation vehemently denies.

Did SUI Insiders Cash Out $400M?

On Monday, Oct. 14, crypto influencer Light alleged that insiders, possibly tied to a large foundation wallet, sold off $400 million in SUI tokens during the recent price surge.

The influencer claims that the wallet initially offloaded tokens in small batches at lower prices, then ramped up sales as the market took off.

“It does not bring comfort that the people building this ecosystem, who arguably know this token’s value best, are unloading hundreds of millions of dollars of tokens into less informed buyers chasing momentum,” Light wrote.  

The accusations sparked unease, as those closest to the project appeared to have been “unloading hundreds of millions of dollars of tokens into less informed buyers chasing momentum.”

The influencer traced the selling activity back to an ICO-era SUI wallet, which has consistently dumped tokens as the price rises.

Light noted that the selling began in August, coinciding with the token’s sharp ascent to new all-time highs in September .

Sui Foundation Pushes Back Against Insider Trading Allegations

The SUI blockchain’s official X account has responded to the accusations of insider trading, issuing a forceful denial of any market manipulation.

The platform categorically stated that neither its employees nor its partners at ML, a non-custodial investment management platform, were behind the massive $400 million SUI sale. According to the foundation, no individual or group of insiders sold the tokens in question, either separately or collectively.

“Insiders have not been involved in any preemptive selling or violation of lockups and the circulating supply schedule,” Sui Foundation wrote. 

While SUI has distanced itself from the token sale, the platform suggested that the likely owner of the wallet is an infrastructure partner bound by a lockup schedule.

“All token lockups are enforced by qualified custodians and continuously monitored by the Sui Foundation, and this partner complies.”

In essence, SUI hinted that the wallet address involved in the $400 million token sale might belong to one of its infrastructure partners. However, the platform stopped short of clarifying whether the partner had indeed sold or dumped the tokens on the open market.

SUI Price Remains Intact

Despite the recent bombshell allegations of insider trading, the SUI token price has shown remarkable resilience, with no signs of short-term damage.

In fact, the token has continued to trade above $2.23, posting a notable 2% gain over the past 24 hours and an impressive 10% surge on the weekly charts.

SUI token price. Source: Coinmarketcap

The layer 1 blockchain network has been on a tear this bull season, drawing comparisons with other popular blockchains like Solana.

SUI has witnessed remarkable on-chain growth and user adoption, with the network experiencing a significant surge in activity. The network has flipped Solana in terms of daily on-chain activity, cementing its position as one of the best-performing tokens this year.