Nasdaq, 21Shares SUI ETF Application… Will This Be a Turning Point for the Ecosystem Recovery?

Nasdaq has submitted a 19b-4 form to the U.S. Securities and Exchange Commission (SEC) for listing the 21Shares SUI ETF.

This move is a crucial step towards introducing a spot SUI ETF in the U.S. market, despite the network's recovery from recent ecosystem-related issues.

Rising Indicators Strengthen SUI ETF Approval Possibility

The submitted document posted on the SEC's public register initiates the official review process, potentially becoming one of the first altcoin-based ETFs in the United States after Ethereum.

The Sui Foundation stated in their blog that this submission marks the official start of the U.S. spot SUI ETF review process.

"The 19b-4 submission is now officially posted on the SEC's public register, signifying the official start of the review process." – Blog excerpt

This submission follows 21Shares' S-1 registration in April, representing a significant advancement towards the institutionalization of the Sui ecosystem.

Over $300 million has already been invested in SUI-based ETPs globally, primarily through listings on Euronext Paris and Amsterdam. Demand for regulated U.S. exposure is increasing.

Sui's unique technical architecture has supported its growth. Sui's object-oriented programming and horizontally scalable infrastructure support diverse use cases, ranging from DeFi and gaming to real-world asset (RWA) tokenization.

The ecosystem's indicators reflect this momentum. According to defillama, Sui ranks 8th in total value locked (TVL), with $1.944 billion currently deployed on the platform.

Stablecoin market capitalization has increased by over 190% year-to-date, exceeding $1.1 billion. Similarly, Sui blockchain's stablecoin transfer volume exceeded $110 billion in May alone.

SUI Recovers After Cetus Hacking Incident

BeInCrypto recently reported the $260 million Cetus hack on Sui, which triggered network freezing amid decentralization concerns. Amid controversy, the Sui network also faced backlash over a $162 million recovery plan for Cetus.

Cetus is a crucial decentralized exchange (DEX) and concentrated liquidity protocol within the Sui and Aptos ecosystems. The network has since recovered, with TVL rebounding, reassuring participants of the protocol's resilience.

This platform plays a fundamental role in supporting traders, liquidity providers, and DeFi applications built on Move-based chains like Sui.

Sui has made efforts to restore user trust, including a $10 million security improvement. By shifting to shared responsibility and providing direct support to dApp developers, they have prevented future vulnerabilities.

Against this backdrop, the SUI price has rebounded. The SUI price has risen 18% since early June and is currently trading at $3.47, representing a slight 2% increase in the past 24 hours.

Kevin Bun, Chairman of Mysten Labs, stated that the Sui ecosystem has become a primary destination for serious developers and institutions.

"This Nasdaq filing is a powerful moment. We are proud to help 21Shares create a world where every investor can access SUI." – Blog excerpt, Kevin Bun

This move is also sparking speculation about a broader "Altcoin ETF Summer," noted by Bloomberg analyst Eric Balchunas.

However, when questioned about potential demand, Balchunas explained that not all altcoin ETFs would meet the same level of demand as the Bitcoin ETF.

"The further you get from BTC, the less the asset becomes," Balchunas mentioned.

He also noted that Osprey's aggressive Solana application could accelerate the SEC's timeline for altcoin ETF decisions.

Meanwhile, the SEC has delayed its decision on the Hedera ETF application and extended the comment submission period.

"The Commission determines it is appropriate to designate a longer period to allow sufficient time to consider the proposed rule change," said SEC Chair Paul Atkins.

As the market remains cautiously optimistic, the progress of 21Shares SUI ETF represents a crucial moment for the mainstreaming of the Layer-1 ecosystem. While it is still uncertain whether Sui will become the next major asset class in the financial market, institutional demand appears to be ready at present.