Introduction to Scallop
The current bull market has witnessed Sui blockchain's remarkable growth since the Sui Foundation initiated substantial incentive programs. Its native token $SUI surged over 4× from its bottom, while the total value locked (TVL) peaked at $750 million - more than double Aptos' $330 million.
With Sui's TVL now stabilizing at $664 million and the Movement ecosystem gaining momentum, we anticipate Move VM bridging EVM ecosystems for collaborative growth.
As Sui's flagship lending protocol, Scallop holds comparable significance to AAVE in Ethereum's ecosystem. This guide explores Scallop's unique features, ecosystem health, development prospects, and stable yield opportunities.
Latest Update: Scallop's Swap Trading Campaign (5,000u $SCA Prize Pool)
Sui ecosystem's momentum continues with:
- $SUI's multi-fold price surge
- Circle's announcement of native USDC coming to Sui
- Coinbase adding Sui-based USDC to its listing roadmap
Scallop launches a trading campaign from October 9-23 (SGT) where participants can:
- Swap any token to $SCA
- Swap any token to native USDC
- Swap wrapped wUSDC to any token
Complete these simple tasks with $800+ trading volume to share 15,000 $SCA (~$5,500).
Campaign Advantages:
- Zero gas fees during event
- Reduced borrowing fees (0% during campaign)
- Optimal conditions for arbitrage opportunities
Scallop's Foundation: Team, Funding, and Audits
Core Team
Founded by engineer Kris Lai with Taiwan-based core members and APAC presence across Singapore and South Korea.
Funding Highlights
- $3M raised March 2024
- Led by CMS Holdings and 6MV
- Notable investors: KuCoin Labs, Mysten Labs, Signum Capital
- Strong official ecosystem support evident through Mysten Labs' participation
Security Framework
- Audits by OtterSec and MOVEBIT
- Security partnership with Zellic
- All three security providers are also investors
Scallop's Core Lending Mechanics
Lending Pools
- Deposit assets to receive sCOIN (receivable certificates)
- Example: Deposit $SUI → receive $sSUI
- Enables seamless asset transfers without pool withdrawals
Borrowing System
- Deposit collateral assets
- Select desired loan assets/rates
- Earn borrowing rewards (current APRs reaching 26% with $SCA/$SUI rewards)
Price Oracles & Liquidation
- Powered exclusively by Pyth Network
- Soft liquidation mechanism minimizes volatility losses
- Asset-specific liquidation thresholds (unlike Navi's multi-factor approach)
Competitive Analysis: Scallop vs. Navi Lending
Key Differentiators
| Feature | Scallop | Navi |
|---|---|---|
| Flash Loans | Zero-fee supported | Limited |
| LST Integration | Future potential | Existing volo SUI LST |
| Borrowing Rewards | Active $SCA incentives | None |
| TVL | $66.4M | Comparable |
Ecosystem Positioning
3 protocol in Sui ecosystem (after NAVI and Cetus)
- Leading lending platform by TVL
- Healthy 31.02% capital utilization rate
Token Economics: $SCA Breakdown
Distribution
- Total supply: 250M $SCA
- Circulating supply: 12.1% (~30.25M)
- Market cap: $16M (Rank #1170)
Allocation:
- Liquidity mining: 45%
- Team/Contributors: 19.5%
- Investors/Partners: 15%
- Ecosystem/Community: 7.5%
- Treasury: 7%
$veSCA Staking Benefits
- Boosted borrowing rewards (up to 4×)
- Platform revenue sharing (Q2 2024)
- Governance rights (Q3 2024)
Price Performance
- Launch price: $1.06 (March 9, 2024)
- Current price: $0.55
- FDV: $138M
Current Incentive Programs
👉 Join Scallop's 300% APR Lending Pools
Weekly Reward Rotation
- Ongoing since March 2024
- Daily increasing $SUI/$SCA rewards
- Triple-digit APRs available
Community Events
- Regular Sui ecosystem panels with projects/KOLs
- Next event: May 16 (8PM SGT)
FAQ Section
What makes Scallop different from other Sui lending protocols?
Scallop offers unique zero-fee flash loans, soft liquidation mechanisms, and substantial borrowing rewards through $SCA incentives - all backed by Sui's official foundation.
How risky is participating in Scallop's high-APR pools?
While APRs exceed 100%, participants should monitor collateral health closely. The soft liquidation feature helps mitigate volatility risks compared to traditional protocols.
When will $SCA stakers receive governance rights?
Governance features for $veSCA holders are scheduled to launch Q3 2024, following revenue sharing implementation in Q2.