SUIG

Ecosystem and Network Development

• The SUI network continues to scale, sustaining 297,000 transactions per second with 300-millisecond finality, confirming its horizontal scalability. Total cumulative transactions surpassed 4.5 billion, and developer count grew to 1,400, ranking 10th among all blockchains by GitHub activity.
• Institutional adoption advanced: Coinbase introduced direct staking for SUI tokens, expanding institutional access to the network. Mubadala Capital launched a tokenized private market strategy on SUI, demonstrating the network's use as core infrastructure for on-chain financial products, not just a trading venue.
• New protocol functionality added gasless stablecoin transfers, which eliminated the requirement for users to hold SUI to pay transaction fees. The network processed approximately $65 billion in stablecoin transfer volume in the first month post-launch, indicating strong early demand for low-friction on-chain payments.
• SUI's Hashi primitive for unlocking productive use of Bitcoin as on-chain collateral now has over 20 institutional partners (including Cumberland, Fluid, SwissBorg, BitGo, and Ledger) building on the protocol ahead of its global testnet launch this month.

Treasury and Capital Deployment

• As of August 3, 2026, SUI Group holds approximately 109 million SUI tokens, with a majority staked to generate an estimated 1.7% annual yield, equal to ~5,300 SUI per day. The company also holds $10 million in SUI stablecoins to support ecosystem liquidity and adoption.
• The company expanded its strategic partnership with Bluefin, a leading DeFi platform on SUI, lending an additional 4 million SUI tokens to bring total commitments to 6 million SUI. In exchange, SUI Group's revenue share increased from 5% to 11%, with the agreement running through September 2028. This provides economic exposure to Bluefin's growth as a core ecosystem venue, with a different return profile than passive staking.
• During Q2, management unwound all DeFi positions after a risk reassessment and recovered 100% of deployed capital, demonstrating ongoing, proactive risk management for all treasury allocations.
• Two strategic investments were made in AI/agentic finance opportunities: $3 million via a SAFE to NL1 (N of 1), an AI research firm building specialized models for autonomous trading in financial markets, and $3 million in Recursive Superintelligence, a foundational AI research company working on self-improving algorithms. These investments target the near-term application of AI to finance and long-term foundational AI capabilities, respectively, aligning with SUI Group's focus on agentic finance built on blockchain infrastructure.

Governance and Operational Improvement

• Christina Campbell was appointed as an independent director and chair of the audit committee, bringing over 20 years of experience in digital assets, fintech, and finance from roles including CFO of Ripple Labs, to support institutional scaling of the business.
• Operating costs have been cut by 50% over the past 12 months, with the company holding $3.1 million in cash and cash equivalents as of June 30, 2026, providing over two years of operating runway excluding any yield from treasury activities.

Legacy Business Management

• The legacy specialty finance portfolio is being actively managed to maximize recoveries. It now stands at $2.2 million in fair value, with no expected material new originations, and management focuses on working out remaining positions selectively.

• Management did not provide explicit quantitative financial guidance for full-year 2026 or future quarters. It reaffirmed its long-term strategic priorities focused on increasing SUI per share, improving balance sheet productivity, and delivering durable long-term returns to shareholders through risk-adjusted capital allocation.
• Management expects to provide additional clarity on planned enhancements to the company's management and leadership structure in the next quarter, with no further details provided at this time.
• No upward or downward revisions to prior long-term strategic guidance were announced, and the company reaffirmed its focus on shifting all resources to digital asset treasury and investments in blockchain and AI fintech, away from legacy specialty finance.

SUI Group operates two segments: Digital Asset Treasury and Legacy Specialty Finance. For Q2 2026, total revenue and other income was $1.2 million (100% of total revenue contribution), up from $948,000 in Q2 2025. The increase was driven entirely by the Digital Asset Treasury segment, which generated SUI staking revenue and digital lending interest income. This segment reported $16.6 million in non-cash fair value losses on digital assets, consisting of $18.9 million in realized losses partially offset by a $2.3 million unrealized gain, leading to a total operating loss of $18.9 million for the quarter. The Legacy Specialty Finance segment has a remaining portfolio of $2.2 million in non-bank loans measured at fair value as of June 30, 2026, and received just $900,000 in repayments and redemptions in the first half of 2026. This segment is not expected to contribute meaningfully to revenue in the near term, representing less than 5% of current asset value.

• Digital asset prices are inherently volatile, and US GAAP requires mark-to-market accounting for digital asset holdings, leading to large non-cash fair value gains and losses that do not reflect actual cash performance or liquidity, but can create large reported quarterly net losses.
• DeFi and on-chain digital asset activities carry persistent counterparty, protocol, operational, liquidity, and security risks, including ongoing risks of protocol hacks that have impacted the broader digital asset sector over the prior year.
• Institutional and user adoption of the SUI network and related digital asset products remains uncertain, and the network trails larger competing smart contract blockchains on some current user activity metrics. The emergence of a breakout adoption driver for the network depends on future development of use cases like agentic finance, which have uncertain timelines.
• While the company currently has sufficient operating runway, future capital allocation decisions (including new strategic investments, potential share buybacks, or ecosystem lending) carry inherent risk of capital loss, and must meet strict risk and strategic fit requirements to be approved.

Q: With SUI price under current market pressure, what are management's top priorities? / A: Management's first priority is disciplined risk management across the business. The company holds ample cash and has no debt, so it is not forced to sell SUI at depressed prices to fund operations. The second priority is growing risk-adjusted yield from the balance sheet. After exiting all DeFi positions, management is focused on bilateral institutional lending opportunities like the Bluefin deal, which yields 5-6% and offers additional upside optionality, as well as lending to market makers to further enhance returns.

Q: What drove the decision to increase the Bluefin loan, and what milestones would drive larger future contributions? / A: Bluefin acquired SuiLend, the largest lending platform in the SUI ecosystem, and the additional 4 million SUI loan financed this acquisition. Management views ecosystem consolidation as a positive long-term trend, and Bluefin's enlarged business has greater scale and revenue potential, making this a risk-adjusted opportunity that aligns with SUI Group's strategy. The increased revenue share reflects the larger commitment.

Q: Given current crypto market pressure, how is the pipeline for Bluefin-style partnership deals? / A: Opportunities still exist, but management maintains strict risk criteria, so most opportunities do not meet requirements. Broad market weakness, reduced DeFi activity, and past sector hacks have led management to focus on institutional counterparties with stronger balance sheets, which offer lower yields than DeFi but better risk-adjusted returns. Security is improving gradually as protocols adopt better protections, including AI tools for risk mitigation.

Q: What is the current operating cost run rate, and are there further efficiencies ahead? / A: Operating costs have been cut by 50% over the past 12 months, and further incremental efficiencies are still possible. Current cash on the balance sheet provides more than two years of operating runway, even excluding all yield and income from treasury activities, leaving the company in a comfortable financial position.