From No Airdrop to 300 Million Airdrop: How Sui Completed the Transformation from VC Darling to "Wealth Effect Generator"

Original Article Title: "Celebrating 2 Years Online, How Did Sui Become the Strongest New Public Chain in This Cycle?"

Original Article Author: Alex Liu, Foresight News

On May 3, 2023, the Sui mainnet was officially launched, marking its 2-year anniversary. Many may remember that when Sui first launched, the situation was not as optimistic as it is now—FTX, the backer, collapsed; the foundation was forced to "buy back tokens" on its own; launching a token in a bear market, the price dropped from $1.7 to $0.4; there was no traditional token airdrop, but a lottery-based token purchase allocation, leading the community to flood the chat with "No airdrop, No community." and even outright calling it a "scam."

Fast forward two years, everything has changed. In this cycle where Bitcoin bottomed at $16,000 and eventually broke through $100,000, Sui is undoubtedly the new star of public chains. Looking at the entire public chain landscape, it is only slightly less prominent than Solana in this round of "rebirth." In fact, the FDV (Fully Diluted Valuation) of Sui's governance token SUI is only surpassed by BTC, ETH, XRP, SOL, and BNB among non-stablecoins, making it the sixth-largest crypto asset in the industry.

Cryptocurrency FDV Ranking, Data: CoinGecko

How did Sui achieve such remarkable success? What did it do right, and where did its competitors fall short? Taking advantage of Sui's second anniversary, the author, as an active participant in the ecosystem, attempts to uncover the growth secrets behind Sui's various data based on personal experiences and subjective perceptions.

DeFi Ecosystem

Today, Sui ranks 9th among all public chains with a DeFi TVL (Total Value Locked) of $17.8 billion, surpassing established public chains like Avalanche and Aptos, a Move language chain that went live a year earlier. However, Sui's DeFi ecosystem development was not achieved overnight.

Public Chain DeFi TVL Rankings, Data: DeFiLlama

Similar to most "VC coins," Sui's mainnet activity data was not impressive right after its token launch. With DeFi lacking users, how did Sui turn the situation around?

Quests "Airdrop Party," Bringing in the Initial Wave of Traffic

Starting from July 23, 20XX, Mysten Labs (Sui's developer) successively launched three rounds of Bullshark Quests in less than six months. Users who completed the quests received airdropped SUI tokens, with 5 million tokens available per round, totaling 15 million tokens airdropped.

It is worth noting that Sui's early quest incentive model leaned towards "sunshine distribution," rewarding based on the number of participants rather than capital allocation. While those at the top of the leaderboard could receive a large number of tokens, regular retail participants lower in the rankings also enjoyed decent rewards.

During this phase, a large number of retail participants and airdrop studios flooded into the Sui ecosystem, helping establish an objective early user base for Sui. The official rewards from Sui also left an impression in the airdrop race as being "non-collusive" and "retail-friendly." It was around the end of 20XX that I was attracted by the quests and started to engage with the Sui ecosystem.

Token Distribution Across Different Ranking Levels in Quest 3

Token Incentives, Strong Price Action Mitigating Selling Pressure

TVL Trend of Sui in the Early Days with Token Subsidies

Sui was among the earliest new public blockchains in this cycle to offer token subsidies to DeFi protocols. Even relatively niche protocols in the early stages were able to achieve over 100% APY through stablecoin farming. Having participated in many DeFi mining activities and tempted by high yields, I increased my capital deployment on Sui during this stage.

Early days with Aftermath stables LP yield peaking at 110%

Subsequently, public blockchains that followed suit with Sui in providing extensive subsidies to the DeFi ecosystem included Aptos, Starknet, Sei, ZKSync, among others. However, these ecosystems did not achieve the same level of prosperity as Sui. Where did the differences arise? DeFi yields attracted mining whales, and as mentioned earlier, the token prices showed relative weakness. To lock in profits, large holders had no choice but to "mine, withdraw, sell," creating sustained selling pressure on the token. The price fell further, requiring an even greater amount of token subsidies to maintain the same yield, perpetuating a vicious cycle.

However, the high token subsidy of SUI was distributed at a low price, and the price steadily rose thereafter. The willingness of whales to hold the SUI token increased, selling pressure weakened, and the amount of tokens required to maintain the same interest rate also decreased, achieving a positive spiral of price growth and TVL growth.

Referring to the current SUI price, the actual annualized yield of the DeFi protocol with a 100% APY mentioned earlier may be above 300%. In this case, "mine, withdraw, sell" instead caused a sell-off.

Chinese Developers, Efficiency at Its Best

Since Sui developer Mysten Labs' founder Evan Cheng is of Taiwanese descent, there are many Taiwanese teams in the Sui ecosystem. Behind the ecosystem, lending protocols like Scallop, options protocols like Typus, stablecoin protocols like Bucket, etc., are all Taiwanese teams. The advantage of having many Chinese developers is the high development efficiency and quality of the code. In comparison, teams in Europe and America tend to have a more laid-back approach to work.

Mysten Labs Co-founder and CEO Evan Cheng

Wealth Effect

The success of an ecosystem is closely related to its ability to create wealth for ordinary users, known as the wealth effect. Taking a god's-eye view and looking back at the timing of Solana's recent rise, apart from the meme track champion, the wealth effect of Jito and the subsequent Jupiter airdrop attracted numerous retail investors to invest in Solana's unforked projects, driving DeFi development, making it an indispensable part.

At the end of 2023 and the beginning of 2024, the top lending protocols Scallop and Navi on Sui also followed Solana's play, starting their point systems and launching tokens one after another. Much of the overflow funds from Solana (Solana was still the preferred choice at that time) participated in these two projects.

As the author, I participated in the Scallop airdrop with $10,000 and received an airdrop of a hotpot meal

But at this time (actually, even now), Sui's native projects could not support a high valuation. Therefore, after receiving several tens, hundreds, or even a few dollars of SCA following the airdrops of several hundred to a few thousand dollars on Solana, people started to complain about the lack of wealth effect for users.

Unexpectedly, SCA turned out to be one of the most "conscientious" airdrops in the Sui ecosystem for quite some time. The neighboring project, Navi, even launched its token a year ago but somehow "forgot" about airdropping it to users, opting instead to engage in user engagement tactics like using a points leaderboard for over a year.

Official Outcome, Creating Wealth Effect

The wealth effect issue is not unique. Public chains such as Aptos, Starknet, Sei, ZKsync, and others have not achieved much in this regard. Or, it could be said that public chains with a wealth effect are a minority.

But where there's a problem, Mysten Labs has a solution.

Mysten Labs is almost unique in its approach, developing projects in-house and airdropping tokens to its own ecosystem. For projects that the native Sui ecosystem cannot support in terms of valuation, Mysten Labs can meet your expectations. Including the Sui mainnet (with a valuation in the tens of billions of dollars), Mysten Labs has already incubated three unicorn-level (over $10 billion) protocols and platforms, all centered around Sui.

Deepbook

Deepbook is positioned as the liquidity hub on Sui, serving as a CLOB (Central Limit Order Book) platform at the protocol level on Sui. Since its launch, it has achieved a peak FDV (Fully Diluted Valuation) of over $3 billion, currently standing at around $18 billion.

On October 14, 2024, DEEP officially conducted its Token Generation Event (TGE), with 10% of the total token supply allocated for user airdrops, reaching a maximum value of $300 million, and a total of 101,968 Sui addresses qualifying for claims.

Sui Name Service

The Sui Name Service is the domain name protocol on Sui, which not only maps addresses on the Sui chain in a .sui format but is also deeply integrated with other Mysten Labs projects like Walrus. For example, if you want a website deployed on Walrus to have a custom domain name, you need to purchase SuiNS. For instance, the official website for WAL staking is stake-wal.wal.app with a rather cumbersome URL, instead of stake.wal.app or staking.wal.app, because the SuiNS domains stake.sui and staking.sui have been purchased by unofficial entities.

On November 14, 2024, the NS airdrop distribution opened, with 10% of the total token supply allocated for community airdrop, reaching a peak valuation of $30 million.

Walrus

Walrus is a decentralized storage and data availability protocol based on Sui, ideally exerting deflationary pressure on the SUI token. Walrus secured a separate $140 million funding.

On March 27, 2025, the WAL token generation event (TGE) took place, with 4% airdropped to active users of the Sui and Walrus ecosystems, as well as testnet participants, totaling approximately $120 million in value. An additional 6% is designated for future airdrops post mainnet launch. Over 120,000 Sui addresses received the WAL airdrop.

During the same period, the liquidity staking project Amnis on Aptos only airdropped to the top 10,000 on the leaderboard, with the circulating market cap of AMI token reaching around $5 million. In comparison, the wealth effect on Sui was quite impactful.

Ecosystem Airdrops

From the criticism of "No Airdrop, No Community." to the paradigm shift of "No Community, No Airdrop," Sui, although it did not conduct a user airdrop at the launch of its mainnet, excelled in subsequent airdrop marketing and community building.

Referring to screenshots in two articles, "The Conference Is Coming, Rumors Abound, Is the Sui Ecosystem Facing a New Airdrop Season?" and "Golden Handbook | How to Arrange Layout for the 300 Million WAL Phase II Airdrop?" the co-founders of Sui subtly hinted at user "airdrop" opportunities, using airdrops as bait to guide user interaction with the ecosystem and community participation, ultimately rewarding users who followed through. This is the kind of "airdrop marketing" that users are happy to see, and the reputation of the Sui chain's wealth effect is thus established.

The author hinted at interacting with SuiNS through Adeniyi and received an NS token airdrop

Excellent Fundraising + Market Value Management

Interestingly, aside from the SUI native coin, the ecosystem tokens airdropped above have not been listed on Binance (have not cashed out chips), and their initial circulation is low. The DeFi protocols in the Sui ecosystem have provided these tokens with extremely high deposit rates, further locking up the tokens to reduce circulation.

Low token circulation makes it easier for Mysten Labs to perform "market value management" and easier to "create a wealth effect."

Learning from Solana

As the two most dazzling public chains in this cycle, Solana and Sui indeed have many similarities in their strategies. In terms of timeline, it should be Sui learning from Solana. What kind of strategy is the undefeated general of this cycle?

Price is the Best Marketing

Observing the rise of Solana and Sui, a common point is that the price of the coin rose before the fundamentals, with various data catching up later.

The price of the coin itself is the best marketing. A strong coin price attracts attention, mindshare, and funds, and all "fundamental" data is thus filled in, providing reasons for further rallies. For example, the growth of TVL is often driven by the rise of the public chain's native coin.

While you are busy promoting the price, there are experts in the background making arguments for you.

Hardware, Airdrops, Both Yours and Mine

Solana launched the Web3 phones Saga and Seeker, aiming to bridge Web2 and Web3 through them, introducing Web2 traffic to crypto. However, in terms of results, most of the buyers of these Web3 phones are native Web3 users, motivated by the potential ecosystem project token airdrops behind them.

Sui also learned from Solana and made efforts in Web3 hardware. On September 2, 2024, Mysten Labs, in collaboration with the game handheld operating system developer Playtron, launched the Web 3 game handheld SuiPlay0X1 for pre-sale (details: priced at 599u, Is the SuiPlay game handheld worth buying?), and the initial sale of 10,000 units of this handheld has been sold out and will be shipped this summer.

We already have the hardware, and I can't miss out on any airdrops you have! Since its launch, SuiPlay has received airdrops or airdrop commitments from over 10 ecosystem projects.

Flash News: SuiPlay Game Console Received Airdrop

Community Building

The unity of the community impacts the overall ecosystem atmosphere and external perception. The current Sui community is undoubtedly one of the stickiest communities in Web3.

Exclusive Agreement for Developers

According to related sources, the Sui Foundation will sign an exclusive agreement with project teams, requiring them to build only on the Sui chain as a condition for receiving Foundation funding (used for user incentives, etc.). The seemingly "closed" restriction effectively prevents developers from being indecisive. Developers on the Sui chain are relatively focused, unlike some EVM chain developers who frequently switch back and forth.

Ecosystem Unity and Mutual Assistance, Benefit Binding

The Sui ecosystem projects are relatively united, often experiencing "mutual airdrops." The author is ranked in the top 50 of the Navi Points Leaderboard; although they did not receive 1 NAVX token airdrop, they received many airdrops from ecosystem projects to Navi users.

Bluefin Airdrops to Sui Ecosystem Projects

Conclusion

Building a strong DeFi ecosystem, creating a significant wealth effect, and fostering a community culture are all challenging tasks. Achieving what Sui has in just its 2nd year is no accident. Even behind a project of this size, there must be Cabal maneuvering and boosting, but the excellence of the Sui team itself is undeniable.

During this cycle, Sui is still chasing Solana. If the development momentum continues, it may soon become a formal challenger in the not-so-distant future.

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