Preface

On May 3, 2023, the new L1 Sui mainnet finally went live, and its token SUI was unlocked at the same time. Since both Sui and Aptos are derived from Diem, a project built by former Meta members, and use the Move language, they are often compared together, while Aptos’mainnet went live as early as in October 2022, and its ecosystem is increasingly prosperous. In this article, we will conduct an in-depth study of Sui's technological innovation and ecosystem development, compare it with Aptos from different dimensions, and make a judgmental analysis from the perspective of investment.

*This article is intended as a research discussion only and may contain biases and errors in facts, data, and opinions, and does not constitute any investment advice and does not assume legal responsibility.

Key Highlights

♦ Sui is a new L1 built by former Meta members with DPoS consensus mechanism, aiming to create an Internet-quantum programmable blockchain.

♦ The technical highlights of Sui include object-centric data model, highly secure and modular Sui Move language, unique DAG architecture and underlying consensus processing mechanism, which enables parallel processing and finality confirmation in half a second. Sui has stronger horizontal scalability and lower latency to support a wider range of applications at a faster speed and lower cost.

♦ Compared with Aptos, which also uses Move language, the Sui Move language is more secure and usable with its consensus mechanism being faster and more scalable. Although the development process of Sui is slower and there is ongly rare PR, it also reflects that Sui acts in a low profile, has a more solid technical foundation and stronger implementation capability, and is worthy of long-term attention.

♦ Potential risks for Sui include that the ecosystem is still at very early stage, and although there are various projects built on Sui, the number of those projects is still small and no leaders and highlights have emerged, and it still needs to continue to work on marketing and attracting good developers.

Outline

1、Project Overview
2、Technology Highlights
3、History and Roadmap
4、Team and Financing
5、Tokenomics
6、Sui Ecosystem Overview
7、Sui vs Aptos
8、Opinion and Summary

1、Project Overview

Sui, developed by former Facebook team members, is a new L1 using DPoS consensus mechanism without license, aiming to build the next decentralized blockchain network for Web3 that can meet the experience of 1 billion users. Sui uses an object-centric data model and is based on the Move programming language, which enables parallel processing, confirming finality in half a second, and engraving security in its DNA. In addition, with powerful horizontal scalability and low latency, Sui is able to support a wider range of applications faster and at lower cost.

On May 3, Sui mainnet was launched as scheduled. Although there are already strong competitors in the Layer1 venue such as Ether, Solana and Aptos, which also uses the Move language, Sui's technical innovations are still worthy of attention. Its founding team Mysten Labs believes that Sui's unique data model (object-centric) enables it to be the first programmable blockchain to reach Internet scale.

In June 2019, Facebook (now Meta) founded project Diem to develop a blockchain, and Meta’s subsidiary Novi Finance was responsible for developing a digital wallet, with the two projects working together to create the foundation of a global payments network. Neither product came to full fruition, and Diem was forced by regulation to shut down and sold all of its assets in January 2022. In the same year, Meta also closed the Novi project without explaining any immediate reasons. Eventually, two separate blockchains were derived from the original Diem and Novi research: Aptos and Sui. Aptos carried on Diem's legacy by iterating on much of the technology developed by the project, while Mysten Labs built a new project from the ashes of Diem - Sui. This article will explore Sui's technical advantages and provide a comprehensive analysis of its pros and cons from an investment perspective.

2、Technology Highlights

Sui is a distributed ledger that stores a collection of programmable objects, each with a unique ID and owned by an address, and each address can own any number of objects. The ledger is updated by a transaction sent from a specific address. A transaction can create, destroy and write objects, or transfer them to other addresses. Unlike traditional blockchains that rely on a "send-and-drop" broadcast mechanism, Sui enables transaction initiators to proactively communicate with validators to finalize transactions near instantaneously. Such low latency is friendly to gaming applications that require a real-time completion environment. Its technical advantages are profiled below.

2.1 Object-centric data model

Many blockchains such as Ethereum and Aptos track blockchain state through account balances, while Bitcoin and Cardano use UTXO for bookkeeping. Sui mixes the two approaches, with objects being Sui's basic unit of storage, whose history is stored in individual objects with globally unique IDs, created and managed by Move packages (aka smart contracts). Sui assumes that a typical blockchain transaction is a user-to-user transfer or asset manipulation, and optimizes for this situation. Objects are divided into two categories:
a. an owned object (such as an NFT or replaceable token), which can only be modified by its specific owner;
b. shared object (e.g., DEX), which has no specific owner and can be modified by more than one user.

Objects contain metadata to determine the characteristics of different objects, such as ownership and transaction history. Sui's object-centric data model means that the global state is simply the set of all sui objects. Structurally, this takes the form of a directed acyclic graph (DAG), where all transactions take objects as input and generate new or modified objects as output. Each object contains the hash value of the last transaction that generated it. The objects that can be used as inputs are called active objects. Thus, by looking at all active objects, the global state can be determined.

Such a data model allows Sui to process object interactions in massive parallel. Transactions on Sui are grouped according to the objects they interact with. When multiple transactions are submitted at the same time, the verifier can process them in parallel on a separate machine, as long as the transactions are not dependent on each other.

2.2 Sui Move

2.2.1 Move Language
The Move language is based on the Rust language and was originally designed for the Libra blockchain (later renamed Diem.) Libra's mission is to build a global monetary and financial infrastructure that can be used by billions of people, then the Move language must be able to express Libra's monetary governance in a precise, understandable and executable way that meets the rich and diverse the business logic. Its financial attributes and DNA also dictate the security and modularity of the Move language.

A central concept in the Move language is resource. If the struct defined cannot be copied or dropped, we call it a resource. Resources are ordinary values in the Move language that can be stored as data structures, passed as parameters to programs, returned from programs, etc. Resource types are used to encode digital assets and can be customized.

Move provides special security guarantees for resources. Resources are stored in modules and can never be copied, reused or discarded. A resource type can only be created or destroyed by the module that defines that type. This design differs from languages such as solidity in that digital asset transfers are not a simple addition or subtraction of balance values between accounts, but rather a movement between storage locations, avoiding reentry and double spend attacks, which is where Move gets its name. These security guarantees are statically enforced by the Move virtual machine via bytecode verification, which will refuse to run code that does not pass the bytecode verification, thus eliminating the need for smart contract developers to write certain security rules themselves. In other blockchains, namely those that use accounts to store the state of the ledger, these security protections are not guaranteed by the VM. Instead, they must be manually coded by the smart contract developer. Account checking in Solana, for example, is a type of security protection guaranteed by the Move bytecode verification in Sui. The difficulty of properly implementing account checks is one of the main causes of the worst hacks in the Solana ecosystem.

The following are some notable hacking incidents, all due to incorrect implementation of additional code (which was completely unnecessary and avoidable in Sui):
Wormhole (Solana - Account Replacement Vulnerability): $326 million
Cashio (Solana - Account Replacement Vulnerability): $48 million
DAO Hack (Ethereum - Re-entry Vulnerability): $50 million

2.2.2 Sui Move
According to Mysten Labs' official presentation, Sui Move makes improvements to Move, with key points of difference including:

• Resources are not deployed in Move, but are stored globally within Sui in an object-centric manner;

• address does not represent a user account, but rather the ID of the object;

• Sui objects with globally unique IDs;

• Sui has a module initializer (init) to help with the rapid deployment of modules;

• The Sui entry point takes the object reference as input.

In summary, Sui takes the security and flexibility of Move and enhances it with the features described above, which greatly improves throughput, reduces eventual latency, and makes programming Sui Move easier.

2.3 Consensus mechanism

Verifiers on the Sui blockchain do not require consensus to process transactions for owned objects. Instead, they use Byzantine consensus broadcasting to execute transactions in parallel with high throughput. Consensus is only required when the transactions involve shared objects. For this purpose, Sui employs a memory pool (mempool) based on Narwhal DAG and an efficient Byzantine fault-tolerant (BFT) consensus via Bullshark. When it comes to shared objects, Sui verifiers play a similar role to verifiers in other blockchains, sequencing transactions for accessing shared objects. Narwhal is responsible for ensuring that the data submitted to consensus is available, and Bullshark is responsible for agreeing on the specific ordering of that data.

Traditional blockchain networks are linear, and each block has to wait for the previous one to be processed before the next one is verified; whereas DAG (Directed Acyclic Graph) does not take blocks as units, and transactions are each points on the chain, stored and authenticated by different nodes, without leaders, so each processes its own transactions and realizes parallel processing of messages. In this way, the relationship between transactions is not Total Order, but Causal Order, thus significantly increasing the processing speed of Sui and enabling parallel transaction processing. Such a situation requires Narwhal and Bullshark to confirm the consensus.

3. History and Roadmap

3.1 Milestones

2022 Q2 Devnet launch

2022 Q4 Incentivized Testnet Wave 1: Network

2023 Q1 Incentivized Testnet Wave 2: Tokenomics

2023 Q2 Permanent Testnet 2023 Q2 Mainnet

3.2 Latest Roadmap

2023 Q2 Mainline; ZK Login.

2023 Q3/Q4 Status snapshot; Archiving nodes; Light clients and sparse nodes; Extensions and slices within the validator; Optimization of cross-signature verification, network storage, indexing; Developer experience: validator, improved language server, hints, automatic formatting, copy/language shell, debugger; MEV prevention, congestion pricing; Short-term vs. long-term storage pricing, storage economics for archival nodes.

4、Team and Financing

Mysten Labs, the founding team of Sui, was founded in 2021 by former Novi project leaders Evan Cheng, Adeniyi Abiodun, Sam Blackshear, George Danezis, and Kostas Chalkias. The founders have expertise in software language compilers, static analysis (programming security), distributed systems, cryptography, and cloud computing, and have experience working at companies such as Apple, Oracle, Microsoft, R3, and Facebook. One of the co-founders, Evan Cheng, received the ACM Software Systems Award for his work designing LLVM (the technology used in most Apple and Google devices today).

In December 2021, Mysten Labs raised $36 million in Series A funding led by a16z with participation from Redpoint, Lightspeed, Coinbase Ventures, Electric Capital and other investors. In September 2022, Mysten raised $300 million in Series B funding at a valuation of more than $2 billion, led by FTX Ventures with participation from a16z, Jump Crypto, Binance Labs and others. Mysten Labs has confirmed to Messari that all of the above rounds were equity funds and that no SUI tokens were sold. (With respect to FTX, Mysten Labs completed a buyback of FTX equity as well as the purchase rights to its SUI token holdings with a total value of approximately $96 million).

5、Tokenomics (SUI)

5.1 Basic information

Sui's ecosystem consists of 5 parts:

• SUI tokens are the original assets of the Sui platform;

• Gas fee to reward participants in the proof-of-stake mechanism and to prevent spam and denial-of-service attacks, Sui's Gas fee design mechanism enables Sui to maintain a low Gas fee even as traffic increases and scales horizontally;

• Sui's storage fund (Storage fund) for transferring equity awards across time and compensating future validators for the cost of storing data previously stored on the chain;

• PoS mechanism for selecting, motivating and rewarding Sui verifiers for their loyalty behavior;

• On-chain voting is used for governance and protocol upgrades.

With the launch of Sui's main website, its token SUI has also completed an IEO on Bybit, Kucoin and OKX at the same time. The current price of the coin is stable at around $1.20, with a total supply of 10 billion tokens and 528,273,718 tokens in circulation, with a fully diluted market cap of $11,767,643,470.

5.2 Token Utility

a. Users can stake SUIs and participate in DPoS mechanisms;

b. Payment of Gas fees;

c. SUI can be used as a versatile liquid asset for a variety of applications, including the standard functions of a currency - unit of account, medium of exchange or store of value - as well as more complex functions enabled by smart contracts, interoperability and composability across the Sui ecosystem;

d. SUI tokens play an important role in governance by serving as the right to participate in on-chain voting on issues such as protocol upgrades.

5.3 Token Allocation

5.4 Token Release Cycle

6. Sui Ecosystem Overview

Compared with Aptos, which is also a Move chain, Sui's development is relatively slower and steadier with a solid technical foundation. Although most of the projects built on Sui are still in the early stage, they have been laid out in various venues. At present, there are 44 projects there, covering infrastructure, game, NFT, Defi and other fields, among which the number of infrastructure projects is the largest, with 19, and the number of game projects is 13.

The following is a brief description of the projects represented in each track.

6.1 NFT & Gaming

SUIA
Suia.io is a social dApp built on SuiNetwork, offering users four innovations: personalized NFT recommendations as easy to use as Tiktok, Feed-based on-chain events, NFT-based brand clubs, and combinable personal spaces. After 10 months of building, Suia now has over 220k users and a community of 300k people with 5k daily UVs. It has received funding from the Sui Foundation, and is an official partner of Mysten Labs.

The SUIA token was listed on Gate, Bybit and Kucoin on May 16. The IEO price at Gate was $0.30 and has dropped 30% in 24 hours, with negative community sentiment.

6.2 Infrastructure & Developer Tools

6.2.1 Sui Move Analyzer
It is a Visual Studio Code plugin developed by MoveBit. It is a free and open source product that improves the Sui Move development experience. It simplifies the development process by analyzing and improving Move code written for the Sui network, supports definition and autocompletion in the Visual Studio Integrated Development Environment (IDE), and provides an outline to give developers an overview of large programs.

6.2.2 Suiet
A cryptocurrency wallet built on the Sui blockchain which helps users manage wallets on the Sui network, including creating and importing wallets, making transactions on Sui and managing NFT. Compared to Sui's official wallet, Sui Wallet, Suiet emphasizes on privacy and open source, claiming to be adamant about not tracking user behavior and collecting data, and is currently the most linked third-party wallet.

6.3 DID & Social Classes

ComingChat
ComingChat is a social platform built on the Sui network and aims to create a Web3 + AI lifestyle. By combining ChatGPT, social and Sui, ComingChat maximizes the user experience in the Sui ecosystem. In addition to the regular chat features, ComingChat includes the following features:

• Sui Mobile Wallet: ComingChat has 4 million users on IOS and Android;

• DMens: The combination of Sui-based "on-chain microblogging" and ChatGPT can help Sui build a value community platform where users can enjoy intelligently distributed on-chain content;

• GPTBot: Customized GPT chatbot offered through Sui as a payment channel.
  The total number of users disclosed on the official website is 6254302, and the DAU reaches 23268.

6.4 Defi

6.4.1 MovEX
MovEX is a DEX built on Sui. its core products include:

• Decentralized exchange (DEX) with AMM + order mix liquidity for centralized liquidity;

• Intelligent liquidity allocation services that automatically adjust liquidity to improve capital efficiency and market maker returns;

• Provide project developers with ILO (Initial Liquidity Offering) services, offering customized token issuance solutions to maximize fund raising.
  The project has 130K+ Twitter followers and a high level of interest, and Mysten Labs has invested in the project.

6.4.2 Turbos Finance
Turbos Finance is a non-custodial and ultra-efficient decentralized exchange (DEX), backed by Jump Crypto and Mysten Labs. Turbos is built on Sui and was launched in June 2022. The project offers a centralized liquidity market maker (CLMM) spot exchange and an AMM perpetual exchange. The goal is to build a robust public infrastructure within the Sui network that will drive mass adoption of decentralized trading through maximum capital efficiency, dynamic asset management and a streamlined trading experience.

Turbos Finance completed an IEO at Gate on May 15, with an IEO price of $0.005, and the price has now dropped by 36.75%.

Overall, most of the projects on Sui Eco are very early, which is also related to the slow development of Sui itself, but the overall layout is reasonable. Some infrastructure projects and Defi projects can help Sui solidify its foundation and introduce liquidity, while we do not see any highlights on the current social and game projects. In addition to the projects themselves, coupled with the current market environment, some of the projects listed have also fallen significantly. As Sui technology is further adopted, hopefully we will see more projects that can fully bring the advantages of Sui chain into play in the future.

7.Sui vs Aptos

Public chains using the Move language were originally defined as Solana killers, and the best known of them are Sui and Aptos, which aim to solve the scalability and efficiency problems faced by current blockchain networks. Aptos was first to market, launching its mainnet on October 18, 2022, and has a thriving ecosystem with more than 100 projects, while Sui has been slow, launching its mainnet in May, and the ecosystem has yet to emerge as a very bright headline project. The following is a comparison of the two in several dimensions.

7.1 Move language: Sui Move is safer and better to use

While Aptos follows the standard design in the Diem white paper, Sui Move upgrades the Move language. Sui's storage system is object-centric, meaning that most things on the blockchain, including addresses and transactions, are represented as objects. Sui Move clearly indicates when an object is owned, shared, mutable, or immutable, while Aptos Move does not. In addition, Sui's ownership API is much clearer than Aptos'.

7.2 Consensus mechanism: Sui is faster and more decentralized

Sui and Aptos have different architectures and different bookkeeping methods; Aptos uses a traditional blockchain approach to record the ledger, while Sui's distributed ledger is a directed acyclic graph (DAG). Aptos uses a variant of the proof-of-stake (PoS) consensus mechanism called Byzantine Fault Tolerance (BFT), which ensures high network security and fast transaction confirmation. Sui, on the other hand, uses a new consensus mechanism called Delegated Proof of Stake (DPoS), which emphasizes energy efficiency and decentralization. In addition, Sui's consensus layer uses Narwhal and Bullshark's asynchronous consensus protocol, and the consensus of causal order can quickly determine the consensus of most transactions, so the TPS can be theoretically uncapped.

7.3 Scalability: Sui is stronger

The horizontal scalability of Sui depends on the number of online nodes and hardware requirements, and its TPS is theoretically uncapped:
CPUs: 8 physical cores / 16 vCPUs
RAM: 128 GB
Storage (SSD): 2 TB NVMe drive.
According to Sui's official test network data updated on April 27, Sui achieved peak throughputs ranging from 10,871 TPS to 297,000 TPS on a variety of workloads across 100 distributed validators worldwide, with Sui's end time (Finality) of approximately 480 milliseconds;

While Aptos officially advertises a TPS of 160,000, the test network reached 4,000, but the TPS has been floating up and down in 10 since the main network went online, and the hardware requirements of the running nodes are:
CPU: 8 cores, 16 threads. 2.8GHz, or faster. Intel Xeon Skylake or newer.
Memory: 32GB RAM.
Storage: 2T SSD with at least 40K IOPS and 200MiB/s bandwidth.
Networking bandwidth: 1Gbps.

7.4 Financing

Rounds Sui Aptos
Seed Round - $200M
Series A $36M $150M
Series B $300M -
Valuation $4B + $2B +
Investors a16z, Jump Crypto, FTX Ventures, Binance Labs, Dragonfly a16z, FTX Ventures

8、Opinion and Summary

Sui's vision is to become a programmable blockchain at the scale of the Internet, and no other blockchain has achieved this goal yet. The founding team from Mysten Labs behind the project has boosted confidence in its technical strength and ability to deliver, but since the main network has just gone live, we still need to wait for the latest data on Sui's main network TPS to verify the potential of its underlying technical architecture. On the other hand, when comparing with the powerful Aptos, we can see that Sui team is not very good at marketing; of course, from another perspective, it can be interpreted that Sui team is concentrating on technology, acting in a low profile and with a steady and stable style, but at present Sui needs a prosperous ecosystem to attract more users and developers with innovation. In terms of community, although people are dissatisfied with the lack of airdrop activity for SUI tokens, Sui team adds participants who have contributed to the ecosystem to the whitelist, so that they can buy SUI at a cheaper price ($0.03) and guarantee a quota of 1,500 pieces. Sui Discord membership reaches 753,464, which has far exceeded Aptos Discord community of 153,343. Although the Fed continues to raise interest rates in May, the crypto market remains depressed and SUI's token price performance is hardly escaping the general trend, Sui exists as an Aptos killer (Aptos' coin price is currently stable at $8.4) and is still in its early stages, well worth watching in the long run. If Sui's TPS can really reach a quantitative change (no upper limit), coupled with the security properties that come with the Move language, thus attracting top developers to move in, I believe there will be disruptive applications born from it in the future, further promoting the prosperity of the blockchain ecosystem.