Jack Paul 
DeFi Protocol Gains Traction on Sui Network
Scallop has become one of the main decentralized finance protocols operating on the Sui blockchain, according to recent data from Messari. The platform now holds over $102 million in total value locked, which is quite substantial for a relatively new blockchain ecosystem. They’ve also generated about $6 million in cumulative revenue as of September 2025, which suggests the protocol is finding real usage rather than just speculative activity.
What’s interesting is how Messari’s analysis positions Scallop among the most influential DeFi applications on Sui. They point to growing liquidity, what appears to be a solid governance structure, and strong user participation as key factors. I think the user participation part is particularly important – it’s one thing to have money locked in a protocol, but another to have active users engaging with it regularly.
Strategic Migration from Solana
The protocol actually started on Solana back in 2021, founded by Kris Lai and Donnie Chen. Their pivot to Sui seems to have been a calculated move to take advantage of Sui’s technical capabilities, particularly its low latency and scalability features. This early adoption strategy positioned them well within Sui’s developing DeFi ecosystem.
Their migration allowed them to leverage Sui’s Programmable Transaction Blocks, which can execute multiple operations in a single transaction. This technical feature apparently helps lower gas costs and improves overall efficiency. They’ve also built Scallop Tools, which lets developers create custom PTBs directly on their platform – that could be useful for building more complex DeFi applications.
Institutional Support and Foundation Backing
Scallop has managed to attract investment from some notable firms including CMS Holdings, 6th Man Ventures, DWF Labs, and UOB Venture Management. They also had angel investors like Dingaling, Pentoshi, and Mario Nawfal participate in early funding rounds, which adds some credibility to the project.
Perhaps more importantly, they’ve maintained a close relationship with both the Sui Foundation and Mysten Labs, the developers behind the Sui blockchain. In January 2023, Scallop became the first DeFi protocol to receive a grant from the Sui Foundation. This partnership strengthened further in October 2024 when they secured strategic investment from the foundation to expand their DeFi offerings.
Token Economics and User Confidence
Scallop’s native token, SCA, serves both utility and governance purposes within their ecosystem. With a total supply of 250 million tokens, they’ve allocated portions for liquidity mining, investors, and team contributors.
What caught my attention is the token locking behavior. As of October, over 50 million SCA tokens are locked in the protocol – that’s 20% of the total supply and 40% of the circulating supply. The average lock-up duration is 3.7 years, which is quite long in crypto terms. This suggests strong confidence from long-term holders rather than short-term speculation.
Users who lock their tokens receive vote-escrow SCA (veSCA), which unlocks governance rights, boosted rewards, and a share of platform revenue. The CEO Kris Lai noted that despite being in a down market, users are still locking up significant amounts for nearly four years, calling it “conviction” rather than speculation.
Scallop actually reached a peak TVL of $195 million in late 2024 and has maintained liquidity near that level. Their veSCA model appears to be driving user engagement and protocol stability by aligning incentives with long-term participation rather than quick exits.