Author：@tmel0211

Source:

https://twitter.com/tmel0211/status/1748588505113166081

Many people are puzzled about the outstanding performance of emerging public chains like @SuiNetwork. In my view, the price surge is just superficial. The real reason lies in the MOVE language public chain’s unique “bloodline advantage” and the potential for a new DeFi ecosystem to erupt. Why?

Next, I will analyze the advantages of the MOVE language public chain, using two key projects in the Sui ecosystem: Top1 @Scallop_io and Top2 @navi_protocol as examples, to explore the possibility of an explosive ecosystem on the Sui chain.

Solidity language is a widely used language on Ethereum for building various types of smart contracts, with a large developer community. Move language, as a newcomer, has significant advantages in resource handling, security, and modularity, especially suitable for the financial application domain.

● Move language introduces a resource model where each Object is treated as a unique entity, enhancing security.

● Move provides a strict type system and ownership model, aiding in compile-time detection and prevention of various vulnerabilities, particularly suitable for handling complex financial transactions.

● Move supports high modularity and composability, allowing developers to create interactive modular and library components.

In summary, Move language boasts strong security, scalability, and efficient state management, making it a native language for underlying DeFi financial products. This is the key reason for the market’s enthusiasm for MOVE language public chains in this trend, known as the “bloodline advantage.” However, for MOVE language public chains to demonstrate their market potential and the rise of the public chain token $SUI, a robust ecosystem must support it; otherwise, it might be speculative.

Next, I have selected the top two projects in the Sui ecosystem on DefiLlama: @Scallop_io, ranking first, and @navi_protocol, ranking second. Let’s assess if there is a possibility of an outbreak in the new DeFi ecosystem on Sui.

@Scallop_io

● Innovative Model: Scallop currently has a TVL of 63.5M, adopting the Compound V3+ Solend V2 model, isolating asset pools and collateral pools, ensuring users can withdraw collateral at any time, ensuring high security.

● Product Features:

○ Utilizes SUI network features to provide users with main accounts and sub-accounts for convenient asset isolation and portfolio management.

○ Inherits the Scallop Tool, allowing users to easily complete multiple transactions in one interface.

○ Rich interface display, serving professional users based on the SDK.

○ It’s worth noting that the account separation feature is based on SUI’s use of the unique account model of the Move language, centered around the Object. Unlike EVM managing “balances,” Objects can manage specific entities, such as homogeneous tokens in Sui, allowing clear tracking and management of a user’s multiple accounts.

● DeFi Complexity Design:

○ Implements a three-tier dynamic interest rate model on excess collateral lending, optimizing interest rate stability.

○ Scallop is highly composable and scalable, allowing users executing collateral to receive corresponding sCoins, which can circulate as derivatives in yield aggregators. Several yield aggregators, such as Typus and Kai Finance, have already integrated liquidity based on Scallop.

○ Uses a decentralized secure oracle mechanism, employing a scalable multi-oracle consensus strategy to increase attack costs, effectively avoiding price manipulation attacks. It supports Pyth, Switchboard, Supra Oracle and other oracles, making full use of the composability of Sui Move. To take just one exception: there are a large number of price manipulation attacks on Ethereum DeFi every year due to the depth of the various AMM trading pools and the inability of the oracle to properly weigh the feeding price by time and volume, which are even considered by many to be legitimate and controllable arbitrage. In Sui ecology, strong modularity and composability can help it reduce such problems.

@navi_protocol

● Basic Model: Navi currently has a TVL of 54M, being a one-stop liquidity protocol based on Aave V3, allowing for circular borrowing and lending, increasing fund utilization efficiency and potential risks.

● Product Features:

○ Leverage treasury, automated leverage, allowing users to repeatedly borrow assets for short or long positions, avoiding multiple repetitive operations.

○ Isolation mode, based on Sui Move features, new assets are listed after governance voting approval.

○ Simple design, user-friendly for novice users.

○ The ability to achieve automated leverage is also thanks to the characteristics of the Move language. Users can precisely authorize a specific token to the smart contract without worrying about unauthorized access to other assets. Additionally, the smart contract can implement multiple repeated operations on that lending token based on the set logic and rules, managing the state in real-time and achieving automated leverage.

● DeFi Exclusive Features: Allows low annual interest rate asset borrowing and relatively high mining returns. This stems from its efficient application of the native asset token model, where users pledging native assets can get borrowing fee discounts. NAVI adopts the Ve model from Curve, allowing veNAVI to efficiently play a role in user voting, LP pool incentives, and more. In addition, NAVI adopts single oracle in the design of oracle, which is highly efficient but has similar risks to EVM environment, and may not be as effective as multiple oracle units in dealing with price manipulation.

In conclusion, I tried to convey, through two DeFi lending products on Sui, the differences between a DeFi protocol in the EVM environment and the Move environment. Overall, the Move underlying framework significantly improves the efficient application of assets in DeFi products, user experience, and security. However, like ZK technology, the learning curve of the Move language is high. Although the language itself has advantages in security and financial complexity, overcoming the language barrier for DeFi developers on Ethereum and introducing richer, more complex financial gameplay and experiences will take some time to explore.

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