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SUI, one of the long awaited blockchain token projects in the cryptocurrency community, was finally launched earlier today. However, contrary to expectations, SUI recorded a significant price drop as trading began on several exchanges.
In the last 4 hours since launch, the token has dropped over 30%. This price action disappointed traders who had expected the token to only lock into a continuous uptrend after its launch, as is often the case during these events.
The token is now available on major exchanges in the cryptocurrency market such as Binance, KuCoin, ByBit and so on. Now the token can be bought and sold for other cryptocurrencies and fiat currencies, including Bitcoin, USDT, TUSD, EUR, BNB and TRY.
According to the Binance blog post on the SUI listing, traders will not pay maker fees on SUI/USDT until further announcements.
Chinese cryptocurrency journalist Colin Wu reported that the official team behind the SUI coin has demanded that exchanges not launch SUI-based perpetual futures contracts. However, exchanges including Bybit, OKX, and KuCoin have launched several SUI trading pairs.
SUI fell over 30%
Interestingly, the value of the token dropped over 30% after its launch on various cryptocurrency exchanges after initially rising over 1000% at launch. The newborn asset is currently trading at $1.53 at the time of the 35% write-down.
The SUI price is moving sideways on the 4-hour chart. Source: SUI/USDT on TradingView.com.
SUI currently has a 24th low of $1.33 and a 24th high of $3.34, according to data from CoinMarketCap. According to CoinMarketCap, despite the market drop, the trading volume of the asset is still growing and is almost $1 million.
SUI is a blockchain project that aims to create a decentralized platform for secure and efficient data storage and management. It was launched in 2020 by a group of blockchain experts who sought to remove the limitations of traditional storage systems such as high cost, centralization, and vulnerability to cyber threats.
The blockchain is based on the Proof-of-Stake (PoS) consensus mechanism, which allows users to stake their tokens to participate in the network verification process and receive rewards for their contribution.
Although several factors may be related to the sharp drop in SUI after its launch on exchanges. However, the reasons may be the dynamics of supply and demand, as well as the disappointment of traders and investors.
When a new cryptocurrency is launched on an exchange, there can be a flood of sell orders as early investors and traders try to take profits. In the case of SUI, those who bought at the pre-sale at a low price and at the open sale may have sold to make a profit.
And if the buying pressure is not strong enough to engulf those sell orders, the price is bound to fall. In addition, some traders and investors may have speculated on the price of the token prior to its launch on the exchanges.
This may have led to inflated and extended expectations. When the price of SUI fell short of these expectations, some may have sold their holdings, which helped lower the price.
Featured image from Unsplash, chart from TradingView