Use Cases of SUI Token
SUI is the native utility token of the Sui blockchain and serves several core functions within the network:
1. Gas Fees:
SUI is used to pay for transaction execution and data storage on the network. Every transaction must include a gas object containing SUI, which is consumed during the process.
2. Staking:
Token holders can delegate their SUI to validators who participate in consensus during fixed-duration epochs. The amount staked influences validator selection and the distribution of staking rewards.
3. Validator Incentives:
Validators receive SUI tokens as rewards for processing transactions and maintaining the network. A share of these rewards can be distributed to delegators as an incentive.
4. Storage Fund Contributions:
A portion of the gas fees collected from transactions is allocated to a network-level storage fund. This fund helps cover the long-term costs of storing data on-chain, promoting sustainable data management.
5. Governance Participation:
SUI holders are expected to take part in protocol governance. Though still in early development, governance will likely include voting on upgrades, protocol changes, and other critical decisions. Delegated stake contributes to governance power.
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