MovEx Terminated by Sui Foundation for Breaching Contract and Circulating Excess SUI Tokens

MovEx Terminated by Sui Foundation for Breaching Contract and Circulating Excess SUI Tokens

Decentralized exchange MovEx finds itself entangled in a critical situation as it stands accused of breaching a contractual lockup, leading to the initiation of three unauthorized transactions, each involving 625,000 SUI tokens to three distinct wallets. The grave violation has sparked immediate concerns within the crypto community, particularly surrounding the influx of surplus tokens into the open market.

In response to the breach, the Sui Foundation has taken decisive action by terminating its relationship with MovEx. This move came as a result of the Foundation’s discovery that the unauthorized transactions caused additional SUI tokens to be in circulation, a direct contradiction to their contractual agreement.

SUI tokens hold paramount significance as they are fundamental for facilitating transactions and upholding the newly launched Sui Network. The Sui Network, a cost-effective blockchain platform, was established by former Meta Platforms (META) employees.

The predicament arose after MovEx was entrusted with 2.5 million SUI tokens, currently valued at $1.6 million, by the Sui Foundation as compensation for their work on the exchange product DeepBook. The agreement included a lockup clause, stipulating that the tokens would be gradually released at specific intervals in the future.

However, MovEx transgressed this lockup condition, proceeding with the three unauthorized transactions of SUI tokens to distinct wallets. The Sui Foundation promptly responded, expressing their lack of knowledge and consent regarding these actions.

Subsequently, at the request of the Sui Foundation, MovEx took corrective action by transferring the entire allotment of 2.5 million tokens to a secure wallet, custodied by a qualified custodian. This custodian will adhere to the contractual lockup schedule, aligning with the pre-established token emissions timeline.

The Sui Foundation has explicitly stated that no additional SUI tokens will be distributed to MovEx, and the exchange will no longer retain its status as one of the primary contributors to DeepBook.

Despite the repercussions, MovEx refrained from contesting or refuting the actions taken by the Sui Foundation. The exchange expressed its commitment to continue operations, emphasizing that upon receiving the SUI tokens, they promptly distributed them to both custodian and non-custodian wallets.

The situation remains closely monitored within the crypto community, as the breach of contract and the resulting circulation of excess SUI tokens have raised pertinent concerns about the stability and integrity of the Sui Network and its associated ecosystem.