The Sui Foundation announced earlier today that it had terminated its relationship with decentralized exchange (DEX) MovEx. The foundation accused the DEX of breaching the contract pertaining to the Sui network’s native token SUI.
The Sui Foundation took to Twitter today to share the latest development with its community:
Crypto tokens are a bedrock of any blockchain economy and are critical to a network's security, operation, and growth.
— Sui (@SuiNetwork) July 27, 2023
At the genesis of a new chain, an initial portion of native tokens are put into circulation for transferring, staking, and holding. Additional tokens are then…
According to the Sui Foundation, MovEx had received 2.5 million SUI tokens in exchange for its contribution to the DeepBook, which is the native order book of the Sui network. These tokens were transferred under a contractual lockup that required the DEX to retain them as per the lockup schedule.
Users on Twitter recently highlighted that a crypto wallet was dumping locked SUI tokens. The blame fell on the Sui team, who faced accusations of misrepresenting token emissions and selling non-circulating staked SUI on Binance. The allegations prompted an investigation into said transactions by the Sui team.
The investigation revealed that MovEx had sold 625,000 SUI in three separate transactions. These transactions were reportedly made without notifying the Sui Foundation. By July 3, 2023, the foundation directed the DEX to transfer the 2.5 million SUI to a qualified crypto custodian who would release the tokens as per the token lockup schedule in compliance with the token emissions schedule.
MovEx’s violation of SUI’s token lockup schedule prompted the Sui Foundation to end its relationship with the DEX and bar it from contributing to the DeepBook order book. The foundation added that it would not allocate any additional SUI tokens to the decentralized exchange in the future.
The Sui Foundation told its followers that all other tokens under contractual lockups were held by qualified crypto custodians. These custodians agreed to enforce the terms of the token lockups and adhere to the previously released token emissions schedule.
