Key Takeaways:

• Sui’s market cap plunged 40.3% QoQ in Q1 2025, underperforming broader crypto markets.
• $549.9M in tokens were unlocked, putting inflationary pressure on price and staking returns.
• Top protocols like Suilend and NAVI retained dominance, despite a decline in TVL.

The first quarter of 2025 marked a challenging period for the Sui network, with its circulating market capitalization falling by 40.3% to $7.2 billion. This stark drop outpaced the broader crypto market’s decline of 18.2% during the same period, as highlighted in the latest Messari report.

However, Sui still managed to climb two ranks, securing the 13th spot in market capitalization rankings, hinting at resilience in the face of a downturn.

Fee generation on the network mirrored the price trajectory, with total fees falling to $3.6 million, a 33.3% quarter-on-quarter decrease. The drop in SUI’s price, along with reduced user activity, led to a 44.4% fall in fees denominated in SUI.

Despite the setback, the network maintained its low-cost transaction model, with average fees of $0.0087 per transaction. Sponsored transactions accounted for over 23% of the network’s total, continuing to drive usability and developer engagement.

Token inflation was driven by supply unlocks totaling 242.5 million tokens across January, February, and March. These included distributions to early contributors, investors, and community reserves. While only 2.42% of the total supply was unlocked, its $549.9 million valuation created tangible market pressure.

At quarter-end, 77.3% of its eligible supply remained staked. However, with liquid staking enabled for locked tokens, its annualized real yield edged into the red at -0.14%, reflecting inflation and limited returns.

Sui’s DeFi Ecosystem Holds Ground Despite Value Erosion

The network’s DeFi landscape continued to evolve, though total value locked (TVL) metrics faced notable contractions. Lending protocol Suilend closed the quarter with $362.1 million in TVL, a 25.6% decline, yet it retained its leading position with a 29.3% market share.

Notably, Suilend introduced STEAMM, a superfluid AMM that boosts capital efficiency by simultaneously deploying LP assets across lending and swaps.

NAVI followed closely with $304.5 million in TVL, reflecting a 24.7% market share. During Q1, it rebranded its NAVI.ag aggregator to Astros and expanded swap capabilities via Mayan Finance. Meanwhile, Scallop reached $147.6 million in TVL and pushed its swap volume past $300 million, adding multicurrency support and securing listings for its SCA token on major exchanges like BTSE and Coinstore.

DEX Volume Breaks Records, Suilend and Cetus Lead Surge

Decentralized exchange activity on the network hit a new milestone, with daily average DEX volumes climbing 14.6% quarter-over-quarter to $304.3 million. Cetus and Bluefin took the lead, generating $171 million and $68.5 million in daily volume, respectively. Other active DEXs included Kriya, DeepBook, and Turbos, reflecting Sui’s strong throughput and expanding trading infrastructure.

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