Many people say that Sui has no innovation and that relying on liquidity subsidies will not be successful.
This is a metaphysical error.
First, we need to consider why subsidies are necessary. Subsidies can be for:
Data manipulation, like the current TVL games, Pointfi points system.
Using subsidies as a pretext for OTC transactions.
The first one needs no explanation. The second logic is understood by many only as a disguised way to offload assets, but in fact, if you want to have a currency multiplier effect, you must have enough TVL invested in liquidity, which means LP or Lending, to trigger sufficient on-chain arbitrage trading.
The difference between Sui's subsidies and the TVL strategies of Restaking or layer 2 is that it allocates reward incentives to liquidity, thereby generating a large number of transactions and fees.
Without this layer, Sui's on-chain liquidity would be insufficient, and the meme season would be impossible. If you experienced Sui before October 2023, you would deeply understand this.
Furthermore, due to compliance, it is difficult for Sui's official team to conduct OTC transactions, which means various wild players cannot obtain low-priced chips, and naturally, there would be no motivation to create split games, even if Sui shows very strong upward momentum. This is also why most split games are primarily dividend games, because only when the chips are distributed can others be motivated to split.
Finally, it is now 2024. If merely talking about innovation were useful, then ETH would be innovating every year with restaking, farcaster, and so on, but does it have any effect on price? The Telegram mini app is considered a great leap forward, but has the liquidity on the TON chain really improved?
Therefore, innovation does not have an absolute positive correlation with market value or price in crypto. Many innovations have nothing to do with liquidity, while the logic of the market and liquidity is objective. Only by doing things that align with this logic can one have a positive correlation with market value.
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