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SUI Price Forecast: Allegations of $400M Insider Sales Loom Over 120% Rally – What’s Next?

SUI Price Forecast: Allegations of $400M Insider Sales Loom Over 120% Rally – What’s Next?

CryptoNewsCryptoNews2024/10/15 17:15
By:Harvey Hunter

Analysts question whether SUI has what it takes to oppose Solana following the allegations.

Last updated:
October 15, 2024 11:43 EDT

Over the past 24 hours, the SUI price has seemingly hit a wall amid significant $400 million insider trading allegations, shaking investor confidence in the asset.

This interrupts what has been a strong week for SUI, up 11.0% since last Tuesday in an extension of a massive 120% rally, positioning it as one of the frontrunners this month .

Indeed, there has been a noticeable shift in investor sentiment towards SUI, with a notable 22.27% drop in trading volume to $946 million over the past 24 hours.

SUI Insider Trading Allegations

These allegations stemmed from an October 14th X post by pseudonymous crypto analyst Light, who challenged SUI’s current valuation, arguing that the notion of it following in Solana’s footsteps “no longer seems tenable.”

One thing that I've found more and more baffling in the last few weeks is the vertical ascent of SUI, with it quintupling off the lows (Ex 1). The market is starved for winners, and believes it has found one here, yet it all feels awfully chintzy for two reasons that I think feed… pic.twitter.com/VKISXpdxp1

— light (@lightcrypto) October 14, 2024

At the center of the controversy were claims of insider trading, with Light revealing that insiders, including a wallet tied to the foundation, profited significantly from the rapid price surge through a $400 million sell-off.

According to Light, insiders “began selling material amounts at much lower prices and are even accelerating their selling at these more elevated levels.”

In response, Sui issued a statement on X denying any wrongdoing. They emphasized that insiders have not engaged in “pre-emptive selling or violation of lockups.”

Following an allegation of “Sui insiders selling $400M in tokens throughout this run-up,” Sui Foundation would like to respond directly to this individual:

1. No insiders, neither employees of the Foundation or Mysten Labs (including Mysten Labs founders), nor ML investors,…

— Sui (@SuiNetwork) October 14, 2024

Instead, Sui attributed the sell-off to an “infrastructure partner” who is in compliance with lockup schedules enforced by qualified custodians.

SUI Price Forcast: Is Sui in the Clear?

While there may be no definitive evidence of foul play, speculation that insiders might be cashing out has raised doubts about SUI’s long-term outlook.

These doubts put recent bullish technical developments on the SUI price chart under scrutiny, particularly following a successful breakout of a cup and handle pattern.

SUI Price Forecast: Allegations of $400M Insider Sales Loom Over 120% Rally – What’s Next? image 1 SUI / USDT 3D chart, cup & handle pattern. Source: Binance.

Concerns are heightened by a troubling Relative Strength Index (RSI), which currently stands at 80, indicating an overbought condition that makes a potential correction credible in the near term.

These worries echo skepticism about whether SUI’s fully diluted valuation (FDV) of $23 billion is justified, with Light questioning whether the project has genuinely “shown a quarter of the potential of Solana.”

Therefore, it would be reasonable to expect a correction in the near term, making the upper bound of the pattern at $2.0725 a critical level.

However, additional challenges could threaten further retracement, particularly with a $114 million token unlock scheduled for October 23rd, which represents 2.32% of the circulating supply. Notably, over 28% of the total SUI supply is already unlocked.

On the optimistic side, if SUI manages to maintain a decisive breakout of the pattern, a conservative price target of around $3.75 by 2025 is plausible. Moreover, the exponential growth and adoption of the Sui ecosystem lend credibility to a more significant price surge, potentially reaching $5.

While Sui could continue its bullish momentum, the large-scale selling raises significant concerns for new investors. According to Light, there is “only one ending” for tokens where insiders are selling to retail investors.

This New Opportunity Has Higher Gains Potential

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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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