Sui TVL ranks among the top ten across all chains, a comprehensive analysis of how Sui's native features promote the thriving development of DeFi

According to DefiLlama data, on January 28, Sui's TVL exceeded $402 million, ranking among the top ten blockchains by TVL.

Sui's innovative application native features pave the way for DeFi applications, providing users with a great experience. Each native feature, from facilitating efficient shared liquidity to simplifying user interactions, plays a crucial role in shaping Sui DeFi.

A closer examination of the core of these native features reveals their significant impact on DeFi applications. When considered collectively, their unique capabilities in enhancing user participation and experience within the Sui DeFi space become even more apparent.

DeepBook

DeepBook is an important component of Sui DeFi, designed as a protocol for achieving efficient shared liquidity across multiple applications. As a Central Limit Order Book (CLOB), DeepBook systematically records buy and sell quotes in chronological order and autonomously identifies matches between them for smooth trade execution. With Sui's high performance, applications can leverage DeepBook to execute trades with low latency and high throughput. As a native protocol within the Sui ecosystem, DeepBook seamlessly provides DeFi applications access to a large pool of liquidity through simple integration, easily meeting the demands of market and limit orders.

DeepBook efficiently stores unmatched orders in a pool and removes them upon successful matching with corresponding orders. DeepBook enables the creation of liquidity pools for any asset pair in a permissionless manner. As the first native liquidity layer on Sui, it fully utilizes Sui's robust network layer and unique data model, thereby streamlining the process of developing DeFi applications within the Sui ecosystem.

zkLogin

zkLogin is a solution to the challenges new users face when exploring blockchain applications. The lack of a simplified login process often creates barriers for users encountering blockchain applications for the first time, leading to significant drop-offs. In contrast, zkLogin simplifies this process by allowing users to securely create accounts and transact using their existing Web2 login credentials.

zkLogin provides developers with the flexibility to offer an invisible wallet that abstracts user interactions with the blockchain or to provide a simpler way for users to access their on-chain assets. It seamlessly integrates with existing account types (such as mnemonic phrases and hardware wallets), catering to both beginners and experts based on user preferences. This versatility enhances the accessibility and user-friendliness of DeFi applications within the Sui ecosystem.

As an important component of Sui, zkLogin empowers application builders to provide the best user experience, catering to individuals who prefer using Web2 logins. zkLogin enhances accessibility and usability, fostering a more inclusive environment among users utilizing DeFi applications within the Sui ecosystem.

Sponsored Transactions

Sui addresses the challenges surrounding blockchain gas fees by introducing sponsored transactions. Requiring new users to pay fees with the underlying blockchain's native tokens can create unnecessary friction. Users unfamiliar with blockchain applications may abandon the process immediately as a result.

Sponsored transactions eliminate the entry barriers associated with gas fees, allowing applications to fund specific user transactions and abstract gas fees from the end-user experience. Sponsored transactions on Sui provide fine control over gas fee sponsorship, offering application developers unique incentives to enhance user engagement and reduce friction for first-time blockchain users. While placing the responsibility for gas fees on applications rather than users may seem like an unlikely business model, it provides builders with the flexibility to determine the revenue model that best suits them.

Programmable Transaction Blocks

Programmable Transaction Blocks (PTBs), as a native feature of Sui, offer unique possibilities for composability and greatly simplify the interaction between end users and the blockchain. Unlike traditional methods that require submitting multiple transactions to perform simple operations, PTBs allow for bundling, signing, and submitting a series of complex transactions in a unified process. Each command is executed in sequence, allowing the result of one command to be used in subsequent commands, ensuring a coordinated and atomic process where the entire block fails if one command fails.

PTBs significantly enhance the experience for application developers and end users by simplifying and consolidating complex transactions. This capability allows for the creation and execution of unique DeFi strategies involving multiple applications and interactions within a single transaction block. As a powerful tool, PTBs contribute to a seamless and user-friendly blockchain experience, providing a streamlined approach to interactions within Sui's DeFi ecosystem.

Kiosk

Sui's Kiosk native feature allows users to maintain full control over their assets while they are listed for sale. When selling items such as NFTs, users often need to relinquish certain ownership-related permissions. For example, an NFT owner may wish to retain access to ownership-related functionalities while their asset is listed for sale. Kiosk not only facilitates the transfer of digital asset ownership but also enables creators to define specific policies for asset types. This includes custom trading functionalities, such as auctions, providing a versatile solution for users seeking seamless interactions and transactions of their assets.

Essentially, Kiosk is a simple yet highly customizable tool for building and participating in business applications on the blockchain. Similar to a real-world kiosk owned by a single owner and designated for various items, Kiosk simplifies the process of trading unique assets. Whether for individuals or large markets, Kiosk offers a one-stop solution that eliminates the need for additional layers or third-party services typically required on traditional networks and some other blockchains.

Enhancing the DeFi Experience

A deep dive into Sui's application native features reveals how DeFi applications on Sui provide a powerful user experience. Applications can leverage DeepBook for instant access to deep liquidity and various trading functionalities. zkLogin and sponsored transactions eliminate significant blockchain adoption barriers such as wallets and gas fees. PTBs offer powerful composability while simplifying user interactions. Finally, the Kiosk provides a unique approach to digital asset trading with robust auxiliary functionalities.

Sui's development is driven by the vision of providing the best experience for end users and developers. The focus of Sui's development is on empowering application builders through Sui's native features, which is crucial for realizing this vision. Stay tuned for upcoming improvements and new Sui native features throughout the year. It is an exciting time for builders on Sui!