Author Rosalia Mazza
In an exciting announcement, Sui Network, a Layer 1 blockchain and smart contract platform, introduced liquid staking capabilities for token holders, offering a significant milestone in user accessibility and network security. However, this comes at a time when the network experiences a shocking 98% plunge in its daily transaction volume.
Following extensive discussions around the Sui Improvement Proposal (SIP) #6, the Sui Network team decided to adopt native liquid staking into its platform, in response to explicit requests from the community.
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The newly introduced feature allows token holders to stake their SUI tokens and receive an equivalent amount of 'StakedSui' tokens, thereby preserving liquidity while contributing to network security.
Users can freely trade these derivative tokens or use them for other purposes while their original tokens remain staked, continuously fortifying the network. An exciting aspect of Sui's liquid staking approach is its inherent potential to decentralize network power, unlike other blockchain models where the staking process can lead to power concentration with a few validators.
"Adding native support for liquid staking dApps as part of the Sui core technology addresses a clear need voiced by our community members who wanted to participate in securing the Sui Network without sacrificing liquidity," stated Greg Siourounis, Managing Director of the Sui Foundation.
Despite these advancements, Sui Network's daily transaction volume has drastically dwindled by over 98%, a mere seven days after hitting a historic high on July 27.
The network, once bustling with activity, has seen the daily transactions plunge to an alarming 902,780 from a record 65.84 million, leaving industry observers perplexed. This alarming slump trails right after the end of MystenLabs' inaugural Bullshark event, a campaign that promoted thousands of games developed on the Sui Network.
While the Sui Network's new liquid staking feature could potentially lure more users, it is yet to be seen whether it will offset the recent drastic decline in transaction volume. The SUI token price also seems to be feeling the heat, as it has reportedly dropped 5% since the introduction of native liquid staking. The token is currently priced at $0.598, with a market capitalization of $433 million and a volume of around $144 million in the last 24 hours.
Despite the price dip and transaction volume slump, Sui's developers remain hopeful. "We look forward to seeing how developers will use this new functionality to build on Sui," Siourounis added.
With Sui's total value locked (TVL) currently sitting at about $14 million, the implementation of liquid staking may indeed offer the much-needed impetus to bolster SUI's standing in the competitive DeFi landscape.
This development marks a pivotal moment for the Sui Network team and its community. It's a testimony to the dynamic nature of the blockchain industry, where innovation and challenges are part of the game. As the industry awaits the Sui Network's next move, all eyes remain on how this Layer 1 blockchain platform maneuvers through these intriguing times.