Sui’s Strengths and Struggles: Will It Dominate the Layer-1 Race?

More from the Author Jane Kariuki

Sui has positioned itself as a strong competitor among alternative Layer-1 blockchains, outperforming Sei and Aptos in transaction throughput, fees, and ecosystem stability, but still trailing behind Solana and Base in valuation and market dominance.

While its growth potential remains promising, Sui must sustain liquidity, adoption, and innovation to compete effectively with leading blockchains.

Sui has emerged as one of the leading high-performance Layer-1 (L1) blockchains, competing closely with Sei, Aptos, Solana, and Base. While all these blockchains strive to offer speed, affordability, and superior user experience, Sui has managed to carve out a notable presence. However, despite its impressive performance, questions remain about its long-term ability to compete with dominant players like Solana and Base.

Sui’s Competitive Edge

In the battle among alternative Layer-1s, Sui has outshined Sei and Aptos in key performance indicators over the last three months:

Transaction Throughput: Sui achieved an average of 57 transactions per second (TPS), surpassing Sei (47 TPS) and Aptos (49 TPS).

Revenue Generation: Sui generated $3.9 million in total fees, significantly outperforming Sei (124x higher) and Aptos (9x higher). However, this still falls far behind Solana’s and Base’s revenues.

Ecosystem Stability: Sui has built a broader financial application base, potentially leading to a more stable ecosystem.

Challenges in Sui’s Growth Path

Despite these positive indicators, Sui faces certain challenges that could impact its trajectory:

Declining TVL (Total Value Locked): TVL, a key measure of liquidity and user sentiment, had been decreasing since September 2024, which could signal waning confidence. Fortunately, this trend reversed recently, but sustaining this recovery remains crucial.

Market Perception and Valuation: Sui’s Fully Diluted Valuation (FDV) has dropped from its peak of $52 billion to $32 billion. While this correction could be seen as a market adjustment, it still reflects a premium valuation compared to Solana, with a Price/Fees multiple of 636x versus Solana’s 67x.

Future Prospects: Can Sui Keep Up?

While Sui has outperformed its closest competitors (Sei and Aptos), the real test lies in its ability to challenge Solana and Base. These two giants benefit from strong network effects, established brand recognition, greater decentralization, and robust marketing momentum. Moreover, their large, loyal communities continue to drive adoption and sustain dominance in the blockchain space.

Final Thoughts

Sui has proven to be a resilient and competitive player among alternative L1s, demonstrating strong adoption and financial metrics. However, the key to its long-term success will be sustaining growth, increasing liquidity, and proving its ability to compete with Solana and Base. While its premium valuation reflects confidence, Sui must continue innovating and expanding its ecosystem to justify its market position and challenge the dominant forces in the blockchain industry.

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