Sui token has suffered a harsh reversal, falling for three consecutive days and erasing most of the gains made last week. Its decline is tied to Bitcoin’s drop to $62,000 and broader market turbulences.
Sui (SUI) retreated to $0.90 on Tuesday, Aug. 27, down by 20% from its highest point last week, pushing its market value to $2.3 billion.
Its retreat happened as Bitcoin (BTC) lost momentum and dropped to $62,000. Other assets that rallied after Jerome Powell’s dovish tone have also pulled back, with the Nasdaq 100, S&P 500, and Russell 2000 indices falling by over 30 basis points on Monday.
Sui, like most tokens in the Binance launchpool, has not lived up to its hype as it has crashed by almost 60% from its highest point this year.
Still, its supporters believe that it will overtake Solana (SOL) in key metrics like market capitalization, Decentralized Finance total value locked, and general developer activity.
They argue that Sui’s blockchain is significantly faster than Solana’s and has much lower transaction costs.
Supporters also claim that Sui is a better alternative because Solana has become highly congested due to its popularity among DeFi, meme coins, and Decentralized Public Infrastructure developers. The case for using Sui for DePIN developers was recently made by Tim Kravchunovsky, the creator of Chirp, a DePIN for telecoms.
Sui has a long way to go to catch Solana, the fifth-biggest cryptocurrency with a market cap of over $71 billion. Data from DeFi Llama shows that Solana has over $5.7 billion in DeFi assets and almost $4 billion in stablecoins.
Sui, on the other hand, has $652 million in DeFi assets and just 38 dApps. It also has $373 million in stablecoins, much lower than what Solana has. Additionally, Sui’s DEX volume in the last seven days was $222 million, while Solana had $5.96 billion.
To be fair, Sui is still in its growth phase as it was launched in 2023, while Solana has been around since 2020.
Another concern about Sui is that it has more token unlocks to go. Data shows that Sui has a maximum supply limit of 10 billion $SUI tokens, of which 25%—or 2.6 million—have been unlocked. Meanwhile, 80% of all SOL tokens have been unlocked, meaning lower future dilution.
Sui price moved above the 50 EMA
Meanwhile, Sui token has pulled back recently after forming a double-top chart pattern at $1.056, with the neckline at $0.8051. In most cases, a double-top leads to a strong bearish breakout.
On the positive side, Sui token remains above the 50-day moving average and has formed an inverse head and shoulders pattern. The ongoing retreat also happened after it retested the 23.6% retracement point.
Therefore, technically, a bullish breakout cannot be ruled out. This view will be confirmed if the price moves above the double-top point at $1.056.
