Company: GSUI
Filing Date: 2025-12-05
Form Type: S-1
Source: 0001193125-25-309828
Chunk: 36

Company: Grayscale Sui Trust (SUI)
Filing Date: 2025-12-05
Form: S-1
Chunk 36
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 adopt certain digital asset networks or protocols at the expense of their engagement with other digital asset networks and protocols, which may negatively impact those networks and protocols, including the Sui Network.

The Trust is not actively managed and will not have any formal strategy relating to the development of theSui Network.

The Sui protocol was only recently conceived, and the Sui Network or its underlying technologies may not function as intended, which could have an adverse impact on the value of SUI and an investment in the Shares.

Components of the Sui protocol were first conceived in 2017 by Evan Cheng, Adeniyi Abiodun, Sam Blackshear, George Danezis, and Kostas Chalkias, continuing research performed while employed by Meta on the Diem (previously called Libra) project. To achieve consensus among validators, the network historically used a dual-layer design consisting of “Narwhal,” a data-availability layer, and “Bullshark,” a consensus protocol. However, in July 2024, the Sui Network introduced the “Mysticeti” consensus mechanism to replace Bullshark, improving transaction latency and throughput while continuing to use Narwhal for data dissemination. This configuration enables the Sui Network to verify and execute many transactions in parallel, rather than sequentially like in prominent blockchains like Bitcoin and Ethereum. The Sui protocol, Narwhal and Mysticeti are new technologies that are not widely used and may not function as intended. For example, they may require more specialized equipment to participate in the network and fail to attract a significant number of users. In addition, there may be flaws in the cryptography underlying Narwhal and Mysticeti, including flaws that affect functionality of the Sui Network or make the network vulnerable to attack. The development of the Sui Network is ongoing and any further disruption could have a material adverse effect on the value of SUI and an investment in the Shares.

For example, on November 21, 2024, the Sui Network experienced a significant disruption, later attributed to a type of denial of service attack, and was offline for over 2 hours. The development of the Sui Network is ongoing and any further disruption could have a material adverse effect on the value of SUI and an investment in the Shares.

Smart contracts are a new technology and ongoing development may magnify initial problems, cause volatility on the networks that use smart contracts and reduce interest in them, which could have an adverse impact on the value of SUI.

Smart