Phantom Drops Sui as an 82% DeFi Retreat Tests the Network
Phantom will end support for the Sui blockchain on September 24, roughly 20 months after first integrating the network, requiring users to migrate their Sui assets or convert them into supported tokens.
Summary:
- Phantom will discontinue Sui support on September 24.
- The integration lasted only about 20 months.
- Sui’s DeFi TVL has fallen sharply from its October 2025 peak.
- Users can migrate to another Sui wallet instead of selling their assets.
The decision arrives during a difficult period for Sui’s DeFi economy, where total value locked has fallen from a peak near $2.58 billion in October 2025 to roughly $469 million, although Phantom has not attributed the withdrawal to declining network activity.
Phantom’s Sui Expansion Lasted Less Than Two Years
Phantom began rolling out Sui support on January 29, 2025, initially in beta, before making the network available to all users in May.
At launch, Sui joined Solana, Ethereum, Bitcoin and Base inside the multichain wallet. Users could hold and transfer SUI, trade Sui-based assets and access applications such as Suilend, NAVI, Cetus and Bluefin.
The integration gave Sui access to a sizable distribution network. The Sui Foundation said Phantom had approximately 15 million monthly active users when support launched, describing Sui as the only Move-based blockchain then fully supported by the wallet.
That distribution channel is now being removed.
Reports on the transition say the decision was reached in coordination with the Sui team. Neither side has publicly established Sui’s falling TVL as the reason, so the timing should not be treated as proof that weaker DeFi activity caused Phantom’s withdrawal.
The overlap is nevertheless significant because the capital committed to Sui’s DeFi applications has contracted substantially since Phantom added the network.
Sui Has Lost More Than $2 Billion in DeFi Liquidity
Sui’s TVL peaked near $2.58 billion in October 2025 and has since fallen to roughly $469 million, representing an approximately 82% decline.
That contraction removes more than $2 billion in dollar-denominated value from Sui’s DeFi ecosystem.
TVL does not measure the health of an entire blockchain. Falling token prices can reduce the dollar value of deposits without the same percentage of assets necessarily leaving, while payments, stablecoin transfers, gaming and other applications can generate network activity without contributing heavily to TVL.
For DeFi, however, the decline has practical consequences. Lower liquidity can reduce available borrowing capacity and market depth across decentralized exchanges, lending platforms and other capital-intensive applications.
Phantom’s departure adds a separate challenge: access.
A dedicated Sui user can switch wallets relatively easily. A casual Phantom user who originally discovered Sui through an existing multichain wallet must now decide whether maintaining that exposure is worth migrating to another application.
What Phantom Users Should Do Before September 24
The cutoff does not mean SUI held through Phantom will disappear on September 24.
Phantom is a self-custodial wallet. The assets exist on the Sui blockchain rather than inside Phantom itself, and reports on the transition say users retain control of their funds. What changes is Phantom’s ability to provide the interface through which those assets are accessed and transacted.
Users who want to remain in the Sui ecosystem can prepare with a short migration checklist:
- Review the entire Sui portfolio first. Check SUI, other Sui tokens, NFTs and any assets committed to DeFi applications rather than looking only at the visible SUI balance.
- Choose a compatible wallet. Sui-focused alternatives include wallets such as Slush and Suiet. Users should confirm that the wallet they select supports the specific assets and applications they use.
- Decide between importing and transferring. Importing compatible wallet credentials can restore access to the existing blockchain account, while creating a fresh wallet requires sending assets to a new Sui address.
- Test a new address before moving everything. When transferring to a newly created wallet, sending a small amount first can confirm that the destination address and network are correct.
- Keep enough SUI available for transaction fees. Users moving multiple assets should avoid transferring their entire spendable SUI balance before the remaining transactions are completed.
- Verify the result onchain. Phantom recommends using a compatible Sui blockchain explorer such as SuiVision to confirm addresses and transaction history.
Users who prefer to remain entirely within Phantom can instead swap Sui assets into supported assets before the deadline. Reports on the transition say Phantom is waiving its own fees on eligible conversions through September 24.
Importing a Wallet Is Different From Moving the Assets
The distinction is important because the two migration methods have different security implications.
When a user imports an existing recovery phrase into compatible wallet software, the assets themselves do not move. The new application is simply being given the credentials necessary to interact with the same blockchain accounts.
Phantom’s own Sui onboarding documentation illustrates how recovery-phrase imports work. Its original instructions directed users through Settings → Manage Accounts → Add/Connect Wallet → Import Secret Recovery Phrase, followed by entering the 12- or 24-word phrase.
A user who instead creates a new Sui wallet receives a new address and credentials. Assets then need to be transferred onchain from the old address to the new one.
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The latter involves additional transactions but avoids entering an existing recovery phrase into another wallet application.
Whichever method users choose, recovery phrases should only be entered into verified wallet software. Phantom says its support staff will never request a Secret Recovery Phrase, private key or wallet PIN, nor will support contact users first or ask them to transfer funds.
That warning becomes especially relevant around forced wallet migrations because deadlines provide an obvious opportunity for fake “migration support” websites and impersonation accounts.
Why Losing Phantom Matters Beyond Wallet Storage
Phantom’s withdrawal matters more as a distribution issue than as a custody issue.
Wallets have increasingly become front ends for blockchain ecosystems. A Phantom user could previously discover Sui applications, purchase SUI, manage tokens and interact with decentralized applications without installing a dedicated Sui wallet.
Removing that integration introduces another step between a potential user and the network.
That friction matters in a Layer 1 market where several blockchains compete for the same users, applications and liquidity. Existing Sui participants have a reason to migrate. Someone who only occasionally held SUI through Phantom may instead choose to swap the position and remain within the wallet’s supported ecosystems.
Phantom’s decision should not automatically be interpreted as a judgment that Sui itself is failing. The wallet has also reduced support elsewhere, suggesting that it is becoming more selective about the networks and asset categories it maintains.
The key question is therefore how many Phantom users Sui can retain after September 24.
Sui Now Has to Prove Its Users Will Follow the Network
The migration creates an unusual test of Sui’s user loyalty.
When Phantom integrated Sui in early 2025, access to the wallet’s 15 million monthly active users was itself part of the attraction.
Now the direction reverses: users who want to continue interacting with Sui must actively follow the network to another interface.
For Sui, that makes the weeks after September 24 more informative than the immediate reaction to Phantom’s announcement. DeFi TVL, application activity and wallet migration patterns can indicate whether users primarily accessed Sui because it was conveniently available inside Phantom or whether the ecosystem has developed enough independent demand to retain them after that convenience disappears.
The information presented in this article is intended for informational purposes only and should not be interpreted as financial, investment, or trading advice. Coinspress.com does not promote or advocate for any particular investment strategy, asset, or cryptocurrency project. Cryptocurrency markets are highly volatile and unpredictable – always perform your own research and seek guidance from a qualified financial professional before making any investment decisions.
Alexander Zdravkov
Reporter at CoinsPress
Alexander Zdravkov is a market analyst and crypto journalist with interests in economics, broader financial markets and digital assets. His journey into crypto began more than four years ago, driven by a fascination with the rapid evolution of blockchain technology and the transformative potential of decentralized finance. He began analyzing market cycles and identifying emerging trends before they reach the mainstream. He holds a degree in International Relations - a background that helped shape his broader perspective on global economics, geopolitics, and the interconnected nature of modern financial markets. Whether covering the latest developments in the crypto sector or exploring broader macroeconomic themes, Alexander focuses on giving readers context rather than simply repeating headlines. During his career, he has authored more than 10,000 articles covering cryptocurrencies, traditional finance, and global market developments. His work spans everything from Bitcoin and altcoins to macroeconomic trends influencing risk assets worldwide.
