How FTX Lost Out on a $1 Billion Windfall From SUI Because of Bankruptcy

If FTX had not sold the SUI token warrants too soon, they might have been worth $1 billion.

After selling its warrant rights to the native token of the soon-to-be-launched layer-1 blockchain too early, the bankrupt cryptocurrency exchange FTX lost the chance to acquire SUI tokens valued at billions of dollars.

The SUI token’s price climbed to almost $3 after the eagerly anticipated debut of the Sui mainnet before declining. The SUI tokens owned by FTX would be worth almost $1 billion at the current price of SUI.

Following the Sale of Its Token Warrants, FTX Forfeits Gains on SUI
By selling 890 million SUI token warrants, the management of FTX missed out on a possible $1 billion payoff. The right to possess future-released assets is granted to an investor via a token warrant. FTX was able to acquire 890,000,000 SUI at launch due to the token warrants held by the cryptocurrency exchange.

Mysten Labs received its Series B funding in 2022 from FTX Ventures, the venture capital division of the now-defunct cryptocurrency exchange FTX. The $2 billion value helped Mysten Labs, the company that created the SUI blockchain, raise $300 million. Binance, Coinbase, and Circle were a few more well-known players in the round.

A $101 million equity stake in Mysten Labs and $1 million worth of warrant rights to buy more than 800 million SUI tokens were purchased as part of the investment from FTX. But in March 2023, FTX declared its intent to sell back its ownership of Mysten Labs as well as the warrant rights to the SUI token.

A little under what FTX paid, the buyback agreement was finalized in April for $96 million. The transaction was related to the cryptocurrency exchange’s bankruptcy procedures.

However, it’s possible that FTX’s sale occurred a little too soon. The Sui mainnet went live on May 3, 2023, and according to CoinGecko, within a short period of time, the SUI token’s price peaked at around $3.5. FTX’s 890 million SUI tokens would have been valued at over $1 billion, which would have meant more money for the company. However, the token’s price has significantly dropped and is currently trading at $1.33.

The SUI Blockchain Reaches a Peak Throughput Rate of About 300,000 TPS
Sui network is a layer-1 blockchain that uses the proof-of-stake (PoS) technique and claims greater speed and scalability. The Sui network recorded an average time to finality of less than half a second and a high throughput rate of 297,000 transactions per second (TPS) with 100 validators, according to a performance update in April 2023.

The SUI token is among the top 100 tokens, with a market cap of more than $700 million. Additionally, the Fully Diluted Valuation (FDV) is currently $13.3 billion, while the circulating supply is above 528 million, or 5.28% of the 10 billion total permitted supply.