Company: GSUI
Filing Date: 2025-12-05
Form Type: S-1
Source: 0001193125-25-309828
Chunk: 40

Company: Grayscale Sui Trust (SUI)
Filing Date: 2025-12-05
Form: S-1
Chunk 40
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 they individually only hold a small amount, and it is possible that some of these wallets are controlled by the same person or entity. As a result of this concentration of ownership, large sales or distributions by such holders could have an adverse effect on the market price of SUI.

Validators may suffer losses due to Staking, or Staking may prove unattractive to validators, which could adversely affect the Sui Network.

Staking on the Sui Network requires SUI to be locked by the underlying blockchain network in “objects,” or data units on the Sui Network that hold assets and are managed by the protocol rather than the user. If the Sui Network source code or protocol were to fail to behave as expected, suffer cybersecurity attacks or hacks, experience security issues, or encounter other problems, such transferred (i.e., staked) SUI may be irretrievably lost. In addition, the Sui Network’s underlying protocol dictates requirements for participation in validation activity, and may impose penalties, if the relevant activities are not performed correctly. In addition, the Sui Network dictate requirements for participation in validation activity, and may impose penalties, if the relevant activities are not performed correctly. The Sui Network’s penalties (i.e., “slashing”) may be imposed if a validator commits malicious acts related to the validation of blocks with invalid transactions. Although the Sui Network does not implement slashing of staked principal, the protocol may impose penalties—such as loss of rewards or removal from the validator set—if a validator commits malicious acts or fails to perform required validation activities.

SUI is inaccessible while it is staked and as part of the “activating” and “de-activating” or “cooling down” processes of staking. “Activation” is the funding of a validator to be included in the active set, thereby allowing the validator to participate in the Sui Network’s proof-of-stake consensus protocol. “De-activating” is the request to exit from the active set and no longer participate in the Sui Network’s proof-of-stake consensus protocol. As part of these “activating” and “de-activating” processes of staking on the Sui Network, any staked SUI will be inaccessible for a period of time, denominated in “epochs.” On the Sui Network, epochs are targeted to last approximately 24 hours, though actual epoch durations may vary slightly due to validator coordination and other timing effects inherent in the network’s consensus protocol. De-activation typically completes when the