Phantom drops Sui support as the network struggles to regain momentum

On the 24th of September, Phantom will cease its support for the Sui blockchain, providing its customers with a couple of weeks to transfer their SUI and eliminating a platform that allowed users to enter one of the most talked-about Layer 1 solutions of 2025.

As mentioned by the Sui Foundation, when Phantom initiated support for Sui, the wallet boasted of having 15 million active users every month.

The announcement comes as Sui’s price has now sunk much lower than it had been in the past. According to the data from DefiLlama, the amount of money trapped in the blockchain altogether is now $470.38 million, while the SUI price is around $0.83, with the whole market capitalization of the coin near $3.4 billion.

This is a significant decline from over $2 billion in TVL when Phantom introduced Sui and from the all-time high of $5.36, which was recorded back in January 2025.

Two ways out before the transition date

Phantom is giving holders two options, both detailed in a company help page.

The first option is to stay in Phantom and convert. Users are able to convert SUI into wrapped SUI on Solana, and Phantom does not charge its own fee for this cross-chain conversion until the transition date. Fees charged by the network and exchange remain in effect, and there will be no additional fees for swaps into SOL, ETH, or USDC.

An alternative option is to retain Sui. Users are able to find their recovery phrase in Settings and use the same phrase to access another wallet that has support for the network. The Phantom wallet recommends Slush as the preferred wallet of the Sui Foundation and indicates that the same address and balances should be reflected automatically.

In either case, users are able to manage their assets. Phantom emphasizes the fact that the currencies are kept on the Sui blockchain rather than being stored in the wallet. Users will be able to retrieve them later on using the same “login” without worrying about any deadline.

Furthermore, Phantom informs users that it will never contact them first or request the seed phrase, and that any offers of help with migration can be considered fraudulent.

From launch hype to an early exit

The closing of the partnership means the end of a high-profile collaboration. Phantom launched Sui on January 29, 2025, making it the fourth Layer 1 to be supported by the wallet, the others being Solana, Bitcoin, and Ethereum, as well as Coinbase’s Layer 2 Base.

The Sui Foundation called it the arrival of “the only Move-based chain and the third Layer 1 fully supported on the platform,” while Phantom CEO Brandon Millman said Sui’s “focus on scalability and its superior user experience aligns perfectly with Phantom’s goal of making crypto accessible for everyone.”

The market response was muted even then. When the integration went live, SUI fell more than 4% that day and had already lost over 20% across the previous ten sessions, Cryptopolitan reported. The two sides now describe the split as mutual and say they may “explore other collaborations in the future,” according to Phantom’s post on X.

A wallet trimming chains, not just Sui

Sui is not the only network Phantom is cutting. A separate help page says the wallet will end Monad support on August 26 using nearly identical migration steps, suggesting Phantom is trimming its multichain lineup rather than reacting solely to Sui.

That fits a broader industry trend. A March 2026 Bank for International Settlements working paper argued that permissionless blockchains continue to fragment the market, as new low-fee chains pull users from incumbents and weaken the network effects that can give individual chains lasting value.

For a major chain such as Sui, losing access to a widely adopted wallet illustrates the retail-facing aspect of fragmentation, with fewer places for users to enter the ecosystem, coinciding with an already diminished rate of on-chain activity.

What’s next for the Sui network?

The question now is whether other multichain wallets will follow Phantom’s example or move in to capture the Sui users that Phantom has diverted elsewhere.

Sui isn’t simply collapsing. Its ecosystem was still attracting infrastructure development in August; Para announced native Sui support on August 12 and highlighted Sui’s growing stablecoin/payment activity. That makes the Phantom exit more interesting: a major consumer wallet is pulling back even as other infrastructure providers continue building on Sui.

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