Sui and Aptos: Decentralized Wolves in Sheep’s Clothing?

In this article, I discussed something that I like to refer to as the decentralization cline. By this, I mean a spectrum of decentralization with at least three points and perhaps more in between: (1) fully centralized; (2) sufficiently decentralized; and, (3) fully decentralized. This is not a fully designed theoretical model, but helps to paint the picture of decentralization as more than two poles and it leaves some room for the grey areas between traditional and decentralized financial systems. Previously, I discussed the prospect of stablecoins, here I would like to question the value of the new chains, Sui and Aptos and suggest that they are not good investments for retail investors that are interested in decentralization as a move away from the traditional fiat-backed financial system.

If you are a fan of Web 2.0 and are looking to ride the wave of transformation into Web 3.0, you will be at odds with the argument presented here. The position of my articles is simply this, I hate the fiat system and the way that it has oppressed future generations by selling the lie of potential prosperity. With the left hand, the government backed fiat system has pushed the youth into university education with the promise of well-paying jobs. With the right hand, this system has simultaneously pushed them head first into the debt vacuum of fractional reserve banking at the very start of their careers. Simply put, this is duplicitous and should not be tolerated moving forward. At this point, you may wonder what this has to do with Sui and Aptos. For me, these two Meta projects are wolves in sheep’s clothing. They have been designed by teams linked to Facebook and Instagram, that have previously tricked the masses into selling their data for like-fueled dopamine hits. This is the key interest of such centralized forces, the manipulation and monetization of your attention. For me, this is the future that Sui and Aptos represent. One where a decentralized future is the sheepskin disguise of the money hungry, capitalistic Web 2.0 wolves.

Image credit: An American Craftsman

As stated above, TradFi is broken. The rich will remain rich and the promise of an economic future for the masses under this system is stagnant. For me, projects such as Sui and Aptos, designed by Meta and funded by venture capitalists Andreessen Horowitz and Goldman Sachs respectively, represent a centralized vision of crypto. The former sits on approximately USD$35 billion in assets, the latter closer to USD$110 billion. These are the forces of traditional finance under the guise of game-changing crypto projects. They were born out of the failure of former Meta-backed crypto project Diem. None of this spells good news for retail investors that are looking to create a decentralized financial system. Venture capitalists don’t seek to participate in financial systems, they seek to dominate them. In fairness to Aptos, their disclaimer hints that their tokenomics are not a roadmap and they appear to be leaning on the legalese of the traditional financial system from the off. This is a major red flag for me. Of course, my biases are stated and I know that I want, at minimum, a corner of the financial system that is sufficiently decentralized. A place where I can carve out a financial future for me and my loved ones away from the doggedly tired fiat system.

Image credit: IStock

Sui uses the term financial plumbing on their tokenomics page. I will refrain from any toilet humor here, but this feels like a bad choice of words for a token that is looking to answer the blockchain trilemma. Namely, the tripartite riddle of decentralization, security and scalability. Like many blockchains and their native assets, I feel that they will provide a very secure financial ecosystem and that their blockchain will be highly scalable. I believe that like Aptos — who already have liquidity pools on Pancake Swap — Sui will be successful in using decentralized infrastructure like Cetus to win over early DeFi adopters. Looking at Sui tokenomics below, the token dynamics appear fairly straightforward and like nothing out of the ordinary. But will this change in time? I highly suspect so. Once a sufficient infrastructure layer is built and enough retail investors are onboarded, I think that these tokenomics will be vulnerable to change. These potential changes are something that I am unsure about exactly, but I am sure that they will lean on legalese to support the key interest of their lead investors: a return on investment.

Envisioned Sui Tokenomics — Image credit: Sui

I do not for one moment believe that Goldman Sachs or Andreessen Horowitz are interested in a decentralized future. Nor do I believe that they are interested in a sufficiently decentralized one. I have my doubts about Hedera and their claims about the decentralization of their project, but something tells me that there is a chance that they could adapt it to become a sufficiently decentralized blockchain. Previously, I have discussed cross-chain maximalism and the idea of interoperability as the future of crypto investment, in my first article about Cosmos. Essentially, I think that the Cryptoverse will harness the full range of options across the centralization-decentralization cline in the future. I would just personally rather invest my funds in assets positioned at the decentralized pole. Hypothetically speaking, if I were to access liquidity pools on Pancake Swap or Cetus and farm Aptos or Sui, I would be doing so as mercenary liquidity to generate profits for the 2025 bull run. I would then invest any profits gained back into fully decentralized projects such as Indigo on Cardano, to preserve the dollar value of any capital gained from this behavior and to invest in projects that I have full confidence in and that fit my investment thesis. This thesis is centered on creating a corner of the cryptocurrency markets that is fully decentralized away from the forces of TradFi.

Image credit: Cryptopolitan

While it is remiss of me to recommend dumping crypto projects — I claim to be a long term investor in crypto after all — it is a strategy that might be useful in promoting the value of decentralized protocols in the long term. The aforementioned venture capitalists will do whatever it takes to generate profit for the investors in their hedge funds. This may well include adjustments to tokenomics and market actions that dump on retail investors. Thus, if the Sui and Aptos projects interest you, I highly recommend taking profits along the way. I’m a self-confessed shill for Cardano and Cosmos and will continue to be so, as long as their current vision of decentralization is the heading for their respective projects. As always in crypto, do your own research and make sure that you take profits along the way. Just keep in mind that the backers and creators of these projects likely do not have the long term interests of retail investors in mind and it is not only centrally-backed projects that are vulnerable to an increase in token supply.

Moover and out!

Disclaimer: this is NOT financial advice. I’m a cow and I like to eat cereal. Any knowledge gained from this post is merely incidental and you are responsible for your own financial decisions. Make investments wisely and make sure to do your own research.