Take an in-depth look at Sui’s surge in liquidity and learn about SUI

The next phase of Sui’s development could make it the blockchain of choice for global payments, gaming economy and innovative DeFi products

Author:@nihaovand

The supply of stablecoins on Sui surged nearly 100 times in more than a year, from US$5.4 million to US$490 million. This is the fastest-growing public chain in Web3.

Sui has more than 1.7 million daily active users, growing faster than Ethereum and competing with Aptos thanks to high-speed DeFi, institutional adoption and aggressive mobility incentives.

As capital inflows accelerate, is Sui positioning itself as the next blockchain to dominate the stabilization of digital assets? Let’s take a deeper analysis.

Contents:

1. introduced

2. Overview of Sui’s object-based model

3. SZNS’s indexing solution

4. Growth trajectory and ecosystem composition

5. In-depth analysis of major local stablecoins

6. Stability coin supply growth and use cases

7. Stability coin liquidity in Sui DeFi

8. Holder distribution and concentration

9. Beyond DeFi: Real-World Use Cases

10. Comparative analysis: Sui and other L1 blockchains

11. conclusion

1. introduced

Since its founding in 2022 by former Meta engineers,@SuiNetwork has evolved into a high-throughput, low-latency Layer 1 blockchain that prioritizes scalability, low cost and user-centered design.

Its core technology, the next-generation Mysticeti consensus protocol, originates from Narwhal (memory pool Tusk), which achieves efficient transaction sequencing and strong data availability. Sui has attracted widespread attention from institutional investors and the DeFi community.

Let us have a deeper understanding of the SUI ecology and its development

key highlights

• Market funds ($SUI stablecoins): increased from US$5.42 million in January 2024 to US$55.15 million in February 2025.

• Adoption of stablecoins: There are more than 5 major tokens (local and cross-chain stablecoins), of which local stablecoins account for 80.1% of Sui’s total supply.

• Ecosystem growth: Hackathons, developer rewards and a range of games and payment projects demonstrate Sui’s broader vision.

2. Overview of Sui’s object-based model

2.1 Conceptual differences from account-based systems

In a typical blockchain like the Ethereum or BNB chain, each account holds a static balance that is updated through the credit/debit system of ledger records. In contrast, Sui adopts an object-based model in which each project user wallet, token, NFT exists as an object with unique attributes and ownership. Key impacts on stablecoins include:

• Object version management: A new version of the affected object is created for each transaction, maintaining a complete audit trail of state changes.

• Complex transfers: A partial transfer may result in the creation of a new object (representing the part of the transfer) while updating the balance of the original object.

• Ownership transfer: The transfer of stablecoins means transferring ownership of the object (or newly created sub-object) rather than updating a single balance field.

These principles underpin Sui’s reputation for flexibility and scalability, but they also require advanced indexing technology to accurately track stablecoin supply, distribution and historical balances.

How object version management and partial transfer work in Sui

Below is a conceptual diagram showing how partial transfers of stablecoins (or any Sui-based token) create new object versions and ownership changes.

Original object (Object0):

• The balance is 100 tokens (for example, stablecoins).

• Owned by Alice (represented internally by the owner field).

Partial transfer of 30 tokens:

• Instead of simply deducting 30 tokens from Alice’s balance and adding them to Bob, Sui modified Object0, reducing its balance to 70, and created a new object (ObjectX) with a balance of 30.

• Ownership of ObjectX is assigned to Bob, while Object0 remains owned by Alice (now a new version, Object0 *).

Version management:

• Object0 * is an updated version (version 2) of the original token object, while ObjectX is a completely new object.

• The original version of Object0 remains in historical storage for auditing, but its state has been replaced by Object0 *.

3 .SZNS indexing solution

SZNS is a data solutions provider specializing in the unique object-based structure of the Sui blockchain. Unlike traditional account-based blockchains, where balances are stored in a single ledger entry, Sui represents assets as objects, which means that each transaction updates and creates a new version of the object, rather than just changing the balance of the wallet.

This object-centric model poses fundamental challenges for tracking and aggregating stablecoin balances, because the supply and liquidity of stablecoin are not neatly stored in a single contract, but are distributed among multiple object states. SZNS solves these challenges by dynamically rebuilding token balances and indexing liquidity across multiple DeFi protocols on Sui

From a high-level overview, SZNS solves these challenges through a multi-layered approach:

Object-level balance reconstruction

• Scan all objects associated with your wallet and keep only the latest version to view your balance in real time.

• Past status and old versions are archived for historical queries (e.g., viewing balances at specific block heights).

Unified DeFi mobility mapping

• Identify custom DeFi structures, such as pool objects, debit certificates, or escrow contracts.

• Standardizing attributes (reserves, LP shares, fees) into a standard internal data model makes it easier to compare liquidity across multiple protocols.

exception handling

• Support special circumstances, such as locking (locking) or entrusting (pledging) stablecoins.

• Introduce specialized logic for protocols with non-standard object structures to ensure minimum data loss.

By aggregating data from these index pipes, SZNS can reliably present the latest stablecoin indicators, which are key to understanding ecosystem liquidity flows and user behavior.

progressive interpretation

data ingestion

SZNS continues to monitor new transactions, block data and status changes on the Sui blockchain. Relevant information (for example, object creation, ownership changes, balance updates) is extracted into the indexer.

Object-level scanner (balance reconstruction)

The indexer queries all objects owned by each wallet. Only the latest version of each object ID is kept in the real-time index. An old version of each object is archived for historical lookup or forensic analysis (for example, looking at the balance of a wallet at a specific block number or date).

DeFi Mobility Mapper

Identify protocol-specific object types related to DeFi:

• Pooling objects for DEX.

• The loan certificate of the lending platform.

• Custody contracts for dedicated revenue farms or IDO platforms. Normalize the data into a standard internal model for comparison across DeFi protocols. For example, pool reserves may be stored differently on two DEXs, but SZNS standardizes them as [tokenA_reserve, tokenB_reserve].

exception handler

• Lock or lock tokens until a future date.

• Entrust or pledge tokens in a dedicated contract or pledge module.

• Any special circumstances specific to the agreement (e.g. heavy benchmark stablecoins, partial mortgage structures). These exceptions are marked and properly classified to ensure that they do not inflate or falsely represent a user’s tradable stablecoin balance.

Final aggregation and API

Data from the previous steps is aggregated into a single warehouse. End users (wallet browsers, analytics dashboards, DeFi applications) can query SZNS’s API to obtain:

• Real-time stablecoin balance.

• Liquidity across DEXs, loan pools and income farms.

• Historical status (for example, the user’s balance on a specific date).

4. Growth trajectory and ecosystem composition

market trends

From $5.42 million to $555.15 million, the total market value of stablecoins on Sui over a year highlighted the strong growth of the ecosystem.

This growth is a reflection of Sui’s technical advantages and user-friendly design:

• Extensibility:High throughput and low final confirmation time make Sui an ideal platform for stablecoin issuers seeking a seamless user experience.

• Institutional confidence:Funds such as VanEck and other large capital allocators have given positive reviews of Sui’s performance.

• Diversified application scenarios:In addition to DeFi, stablecoins on Sui have also gained increasing attention in the gaming, cross-border payments and NFT markets.

5. In-depth analysis of major local stablecoins

Sui ranked seventh in 24-hour trading volume, surpassing Hyperliquid and Avalanche.

From $5.4 million to $490 million, the total market value of stablecoins on Sui over a year highlighted the strong growth of the ecosystem.

Sui’s ecosystem is experiencing rapid growth, driven mainly by a surge in new accounts, strong adoption of DeFi and increased trading activity. Once communicated with the ecological director of SUI, he said that SUI is vigorously encouraging the development of Defi ecology

Although DeFi is booming, driven by rising TVL, there has been a temporary slowdown in NFT and token creation, but this is the reason for market trends.

• User growth:7.5 million new accounts (+104.91%) were added within 7 days, showing strong adoption momentum.

• DeFi：TVL reached US$1.26 billion, with Suilend leading at US$387.5 million (which will intersect with stablecoin supply).

• Continuous network activity:The total transaction volume reached 8.49 billion transactions, an increase of 11.8 million transactions in 24 hours.

• Dominance of stablecoins in the DEX pool:USDC/SUI (volume of $46.9 million) is the most active trading pair.

• NFT and token activity declined:The number of new NFTs dropped 47.98%, and the number of new tokens dropped 5.8%

In addition, Sui has surpassed Ethereum in terms of daily active addresses and is gradually approaching Aptos. Its steady growth highlights the growing adoption in the DeFi, gaming and stablecoins sectors, making it a strong L1 contender.

• Sui’s rapid growth:Sui’s daily active addresses reached 1.7 million, surpassing Ethereum (440,600) and gradually approaching Aptos (1.1 million), marking an increase in adoption.

• Stronger market position:Sui ranks third among the fastest-growing blockchains, ahead of major competitors such as BNB Chain, Base and Arbitrum.

• Competing with leaders:Although Solana (5.3 million) and Near (3.3 million) lead the way, Sui’s steady growth demonstrates its growing influence in the blockchain space.

Overview of Sui stablecoin supply

The total market value of Sui stablecoins was US$495.1 million, an increase of US$15.82 million (+3.30%) in 7 days, reflecting strong growth and continued demand.

Starting from 2025, the steady increase in the total market value of stablecoins indicates that the market has increased confidence in the Sui stablecoin ecosystem. In addition to the USDC, the diversification of stablecoins such as FDUSD and AUSD is also gradually gaining attention.

USDC’s dominance:USDC remains the most dominant stablecoin on Sui, accounting for 47.47% of the market, highlighting its role as the preferred source of liquidity.

Performers of significant growth:

• First Digital USD (FDUSD) has increased by 24.35% in the past 7 days, showing an increase in adoption.

• Ondo US Dollar Yield (USDY), trading at $1.09, rose 0.93% in seven days, showing strong earney-seeking demand.

Underperforming stablecoins:

• Tether (USDT) has fallen-11.16% in the past seven days, losing $1.86 million in market value.

• Bucket Protocol (BUCK) fell-3.18%, possibly due to liquidity fluctuations.

The following is a detailed analysis of the three largest local stablecoins, AUSD, USDC (Sui Native) and USDY, as well as FDUSD and BUCK.

5.1 supply growth

The supply of stablecoins on Sui is surging, driven mainly by DeFi protocol demand, institutional trust and ecosystem incentives. Lending markets like Suilend and revenue farms on Cetus are promoting adoption, while Circle’s USDC issuance improves credibility. AUSD and USDY thrive on strong DeFi incentives, attracting liquidity and capital inflows.

FDUSD (market cap of more than $120 million) and BUCK (market cap of more than $39 million) are also noteworthy stablecoins, but are less covered in the current analysis.

Strong supply growth is mainly driven by agreements:

• DeFi protocol requirements –Lending markets (e.g., Suilend) and DEX revenue farms (e.g., Cetus) have greatly boosted demand for stablecoins.

• Brand trust and partnerships –Thanks to Circle’s direct distribution, USDC on Sui enjoys the trust of institutions, while AUSD and USDY cultivate a strong DeFi community and incentive program.

• Ecosystem incentives –Sui-based agreements provide aggressive annualized rates of return (APR) and liquidity mining incentives to drive capital flows into stablecoins.

• AUSD and USDY The main focus is on DeFi, providing liquidity incentives and encouraging capital inflows.

6. stablecoin growth and use cases, and anchoring mechanisms

AUSD

Anchoring mechanism:Algorithm + Mortgage

• AUSD adopts a mixed approach. Part of the supply is supported by a basket of crypto assets (often including SUI tokens) stored in dedicated vaults, while the algorithm part stabilizes short-term price fluctuations.

• If the price deviates from $1, an on-chain auction or stabilization module can rebalance the AUSD by buying and selling collateral.

Mortgage model:

• It is usually over-collateralized, requiring users to deposit more than $1 in collateral for each AUSD minted.

• The vault may accept mainstream assets (e.g., BTC, ETH) or native SUI bridged on Sui.

Main use cases:

• Loan:Depositors lock in collateral to mint AUSD; borrowers can borrow AUSD based on their positions.

• Income farms:AUSD liquidity pools often provide attractive annualized rates of return, especially among new or smaller DEXs that are competing for liquidity.

Growth drivers:

• Suilend’s high yields,

• Frequent trading incentives on DEX,

• Cross-promotion activities with other DeFi dApps (e.g., early user rewards AUSD).

USDC（Sui）

Anchoring mechanism:Legal currency support (Circle)

• USDC is converted 1:1 to the U.S. dollar, which is deposited in regulated bank accounts or in short-term treasury bonds.

• Circle’s comprehensive compliance and licensing framework is extended to the USDC on Sui, reducing credit and regulatory risks.

Regulatory compliance:

• Circle’s brand builds trust among institutional players.

• KYC/AML programs can be integrated to make them suitable for enterprise-level or B2B use cases.

Main use cases:

• Payment system: Merchants, payroll systems and cross-border remittances can be settled in seconds with a minimum fee based on Sui’s throughput.

• Agency DeFi: Due to its stable anchoring and brand reputation, USDC is welcome for lower-risk agreements or major brokerage services.

• Bridging: Since Circle issues USDC (Ethereum, Solana, Sui) on multiple chains, large amounts of capital can flow seamlessly through official bridging solutions to further increase liquidity.——

Growth drivers:

• Trusted brand (Circle),

• Sui’s fast final confirmation and low fees,

• Collaboration with dApps that provide enterprise-friendly products (e.g., advanced compliance, hosted solutions).

USDY

Anchoring mechanism: crypto mortgage

• Maintain the $1 anchor by over-collateralizing stable or blue-chip crypto assets (e.g., SUI, BTC, ETH).

• Smart contracts automatically liquidate positions and help maintain anchor if the mortgage ratio falls below a safety threshold.

Strong annualized rate of return:

• It is particularly popular on DEXs such as Cetus, offering annualized yields of up to 30%-50% for liquidity providers of USDY trading pairs.

• Some revenue farm strategies allow dual rewards (local governance tokens for the USDY+ protocol).

Main use cases:

• High-yield liquidity provision: For those users who can accept the risk of anchoring crypto-mortgages, USDY usually provides the most attractive benefits.

• Trader leverage: Traders can deposit crypto assets, minte USDY, and use the minted stablecoins to enter other positions, thereby effectively leveraging their investment portfolio.

Growth drivers:

• Aggressive liquidity mining,

• Collaboration with revenue aggregation platforms such as Sui Farm,

• Get a bridging solution to introduce additional collateral (such as BTC, ETH) from other chains.

FDUSD

Although not widely tracked in analysis, FDUSD is a rapidly rising stablecoin with a market capitalization of more than $120 million:

Anchoring mechanism and mortgage:

It may be legal currency support or legal currency like reserves, but the specific details vary depending on the disclosure of the issuing entity.

Adoption factors:

• May be widely used in Sui-based game ecosystems or in dedicated DeFi protocols that work directly with FDUSD publishers.

• Based on user adoption data, it may be integrated with payment solutions focusing on Asian markets.

BUCK

• Currently with a market capitalization of approximately $39 million, BUCK is a small but noteworthy stablecoin that uses a hybrid model:

Mixed mortgage:

• Part is quasi-legal currency support, and part is encryption support. Some speculation suggests that it contains algorithmic elements, but official documents have not fully confirmed it.

Main use cases:

• Initially used in dedicated revenue farm programs or as reward tokens for certain Sui-based P2E (Playearn) platforms

Growth potential:

• If BUCK builds a deeper relationship with major DEX or lending agreements, it could see similar growth like AUSD or USDY.

7. Stability coin liquidity in Sui DeFi

7.1 Total Value Locked (TVL) Distribution

The following is the TVL distribution of the three major stablecoins in Sui’s leading DeFi protocol, AUSD, USDC, and USDY:

7.1.1 Observation

• AUSD is mainly locked in SUILEND (75.80%) due to its high annualized borrowing yield (approximately 11.19%).

• USDY is mainly used in CETUS (86.55%) due to the attractive income farm annualized rate of return (approximately 46.92%).

• USDC is more evenly distributed among CETUS, SUILEND and NAVI, showing broader acceptance and usage patterns.

7.1.2 Agreement Overview

• @CetusProtocol: The leading DEX on Sui, known for its advanced AMM capabilities and liquidity mining projects.

• @suilendprotocol: A powerful lending platform that attracts stablecoin deposits with unique incentives.

• @navi_protocol: Provides a moderate annualized rate of return (about 5%) to attract more conservative liquidity providers.

7.2 Fragmentation of liquidity and emerging solutions

• Fragmentation: Different stablecoins often thrive in different pockets of liquidity, which are driven by different earnings.

• Aggregation platforms: New revenue optimization tools (e.g. SuiVault, SuiYieldFarm) are emerging that allow users to automatically compound interest between multiple agreements.

• Cross-protocol collateral: Some lending markets now accept multiple stablecoins as collateral for each other, potentially reducing fragmentation over time.

8. Holder distribution and concentration

EOA (Externally Owned Address) Despite the growth in total supply, ownership of stablecoins remains highly concentrated in a few addresses:

• AUSD: Largest holder (Wallet A): 47.4% of EOA holds supply. Behavior: Mainly deploy funds in Suilend to take advantage of high annualized rates of return.

• USDC (Sui): Largest holder (Wallet D)：16.6%。The next five largest holders: accounting for approximately 25% of the total. Behavior: Actively provide liquidity on multiple DEXs such as Cetus, Navi, etc.

• USDY: Two wallets (Wallet B, Wallet C): The total accounted for 94%. Behavior: Conduct a revenue farm operation on CETUS, taking advantage of the agreement’s annualized rate of return of 46.92%.

9. Beyond DeFi: Real-World Use Cases

Although DeFi remains a core driver of stablecoin adoption, Sui is actively expanding into games and payment solutions, both of which are major areas of stablecoin use.

9.1 Game: SuiPlay 0x1 case

@SuiPlay aims to integrate Sui’s blockchain technology into mainstream PC and console games.

Key elements:

• NFT and token rewards:Assets acquired by players through games can be converted into NFT or token into credit on Sui.

• Stability coin exit mechanism:Players who want to cash in or exchange these rewards for fiat can use stablecoins such as USDC, AUSD or USDY.

• Comparison with Steam:Steam’s 132 million monthly active users far exceeds the current Web3 game market (the Web3 game market will be approximately US$31.8 billion in 2024, compared to the overall PC game market of US$60.84 billion).

• Future potential:Partnering with large publishers can attract millions of players, each of whom needs stablecoins to trade or cash out rewards.

• Example:A popular role-playing game may issue NFT-based skins that can be sold immediately as AUSD or USDC (Sui), connecting real-world value to in-game achievements.

9.2 Payments and financial inclusion

Sui co-founder Kostas Krypto demonstrated a text-based transaction mechanism for people without a bank account:

• SMS transaction mechanism: Users using basic phones can send/receive stablecoins by sending specific commands or codes. The system checks the user’s Sui wallet object through off-chain or lightweight on-chain services and then executes the transaction.

• Areas with insufficient banking services: Sub-Saharan Africa or Southeast Asia may see increased adoption of stablecoins as a remittance and point-to-point payment option. Reduced reliance on traditional wire transfer or money transfer operators, which typically charge higher fees and settle slowly.

• Issuer Opportunities: Local stablecoin issuers (e.g. AUSD, USDC on Sui) can integrate with local telecommunications companies or non-governmental organizations (NGOs) to provide a stable medium of exchange for day-to-day transactions. Working with microfinance institutions or local cooperatives can promote financial inclusion by promoting lending through stablecoins.

10. Comparative analysis: Sui and other L1 blockchains

Although this report focuses on Sui, a brief comparison table helps compare Sui’s stablecoin growth with other major L1s such as Ethereum, Solana and Avalanche:

Key points:

• Ethereum:The largest stablecoin ecosystem, but also the highest cost.

• Solana：It has good scalability, but has historically faced reliability challenges.

• Avalanche：Strong cross-chain bridging (e.g., subnets), but DeFi’s overall momentum is weaker compared to Ethereum.

• Sui：The combination of a low-cost, user-friendly developer ecosystem and a rapidly growing stablecoin market lays the foundation for widespread adoption of games and payments.

11. conclusion

Sui has evolved from a preliminary L1 blockchain into a rapidly growing ecosystem in which stablecoins play a vital role.

• Exponential market capital growth:The increase from $5.42 million to $555.15 million reflects strong DeFi and institutional interest.

• Object-based nuances:Although architecture adds complexity to the index, tools like SZNS make data insights from stablecoin indicators reliable.

• DeFi dominance:The high-yield agreement (Suilend, Cetus) promotes stablecoin capital flows, often leading to whale concentrations.

• Expand into games and payments:Projects like SuiPlay 0x1 and text-based transactions have opened the door to mainstream markets and under-served markets.

• Future potential:Ongoing improvements to aggregation platforms, multi-chain mortgages, and micro-payment systems may further expand the use of stablecoins.

As Sui continues to expand and explore new areas, stablecoins will continue to play a central role in achieving liquid and stable on-chain commerce.

The next phase of Sui’s development could make it the blockchain of choice for global payments, gaming economy and innovative DeFi products, all driven by stablecoins that provide trust and liquidity.

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