Sui, a layer-1 blockchain, pushed back on Monday against accusations that insiders had offloaded $400 million worth of SUI tokens during a recent price surge.

The allegations stem from claims that insiders, including a wallet tied to the foundation, profited from the rapid price increase last month.

In response, Sui issued a statement via Twitter, denying the accusations and clarifying that no insiders—including Foundation employees, Mysten Labs (Sui’s core development team), or its investors—had sold any tokens.

The concerns surfaced as SUI’s fully diluted valuation (FDV) soared to $23 billion, a figure some in the crypto community deemed disproportionate to the project's current stage of development.

SUI, the blockchain’s native token, has surged over 100% in the past month. However, the token was down 2.5% on the day, according to CoinGecko. Sui did not immediately respond to requests for further comment.

In its statement, the layer-1 suggested the wallet likely belonged to an infrastructure partner whose tokens remain under a lockup agreement, monitored by qualified custodians. 

The blockchain firm reiterated that no premature selling or breach of lockups had taken place.

Some users have questioned whether SUI’s inflated valuation is justified, especially when compared to rival projects like Solana. 

Speculation that insiders might be cashing out led to doubts over the project's long-term outlook.

Multicoin Capital’s managing partner Kyle Samani highlighted the ambiguity in Sui’s denial, tweeting, "This is written as deceptively as possible. Perhaps the insiders collectively sold $399 million. Who knows? The obvious party that is explicitly excluded from the list is the foundation itself! DYOR."

Others echoed the skepticism, pointing out the blurred lines between an infrastructure partner and an insider.

Edited by Sebastian Sinclair