Overview and Investment Objective

Grayscale Sui Staking ETF (Ticker: GSUI) has filed its annual report for the fiscal year ended December 31, 2025, marking its first 10-K since uplisting to NYSE Arca in February 2026. The ETF provides investors with exposure to Sui (SUI), a digital asset, through a regulated and relatively cost-efficient security structure. The Trust’s stated objective is for the value of the shares (based on SUI per share) to reflect the value of SUI held by the Trust, including SUI earned as staking consideration, less expenses and liabilities.

Notably, the Sponsor acknowledges that the Trust has not historically met its investment objective, with shares previously trading at significant premiums and discounts relative to the underlying SUI value. However, since uplisting, the Trust has started to track SUI value more closely.

Key Characteristics of GSUI Shares

• The ETF structure enables cost-effective and convenient exposure to SUI, avoiding the logistical and security complexities of direct SUI ownership.
• As of December 31, 2025, each GSUI share represented approximately 14.4785 SUI.
• The Sponsor and Custodian manage safekeeping, and related expenses are embedded in the share value.
• Sponsor’s Fee is highlighted as a competitive factor influencing share value.
• The Trust relies heavily on third-party service providers for essential functions, posing operational risks if these providers change or fail.

Price-Sensitive Risk Factors

Digital Asset Volatility and Market Dynamics

• Extreme Volatility: SUI and other digital assets have experienced and may continue to experience extreme price volatility, which could materially impact GSUI share value. Shares could lose all or substantial value.
• Market Acceptance: The value of GSUI depends on market acceptance and evolution of SUI and blockchain technologies.
• Concentrated Ownership: Large holders of SUI could impact market price through significant sales or distributions.
• Forks and Clones: Temporary or permanent forks or clones could adversely affect GSUI share value.
• Trading Platforms: The largely unregulated nature of digital asset trading platforms, their exposure to front-running and wash trading, and the potential for manipulation could impact share prices.
• Competition: Emergence or growth of competing digital assets can negatively affect SUI price and GSUI share value.

ETF Structure and Trading Risks

• Liquidity: Liquidity may be affected if authorized participants cease obligations or if the liquidity engager cannot maintain liquidity providers.
• Share Price Relativity: GSUI shares may trade at a price above or below NAV per share. Suspension of the redemption program or limited in-kind transactions could cause shares to trade at a discount or premium, leading to potential investor losses.
• Extraordinary Expenses: Tax liabilities, indemnification obligations, intellectual property claims, or disruptions from pandemics could adversely affect share value.

Regulatory and Legal Risks

• Regulatory Classification: If SUI or other digital assets are classified as securities, it may trigger extraordinary expenses or termination of the Trust.
• Changing Regulations: U.S. and foreign regulatory changes or actions could restrict SUI use or trading and adversely impact GSUI share value.
• Money Services Regulation: The Trust or Sponsor could be regulated as a money service business, incurring additional expenses and decreasing liquidity.
• Tax Uncertainty: Evolving tax treatment of digital assets and SUI under federal, state, and local laws could negatively affect GSUI shares.

Conflicts of Interest

• Potential conflicts may arise between the Sponsor, its affiliates, and the Trust, which could impact Trust operations and share value.
• Shareholders cannot be assured of the Sponsor’s continued services, and discontinuance could be detrimental to the Trust.

Staking-Specific Risks

• Participation Limitations: Failure to meet staking conditions could prevent the Trust from participating in certain staking arrangements, impacting returns.
• Loss Risk: Staking exposes the Trust’s SUI holdings to potential loss, which could affect share value.
• Regulatory Uncertainty: The regulatory landscape surrounding staking is uncertain, posing risks to GSUI shareholders.
• Tax Liabilities: Shareholders may incur tax liabilities from SUI sales or staking rewards without receiving corresponding distributions.

Market Structure and Trading Platform Insights

The value of SUI is determined by market participants on digital asset trading platforms. The GSUI Trust uses an Index Price, a composite reference rate designed to mitigate fraud, manipulation, and anomalous activity. The Index Price is algorithmically determined and can differ from spot prices on individual trading venues. Significant price differentials may erode investor confidence in GSUI’s ability to track SUI market price.

• As of December 31, 2025, the Index included major platforms like Bitfinex and Bullish, among others. Market share and compliance with AML/KYC regulations are monitored.
• The Index Price is calculated using non-GAAP methodology and is not reflected in financial statements, but it is used for NAV calculations.

Operational and Administrative Considerations

• The Sponsor maintains a website with free access to regulatory filings and Trust information.
• Shareholders should note that the Trust is not actively managed. It does not engage in profit-seeking activities or loss mitigation based on SUI market prices.
• Controls are in place to monitor for material hard forks or airdrops. Any change in policy regarding Incidental Rights or IR Virtual Currency will be disclosed via Form 8-K.

Summary for Investors

GSUI presents an accessible vehicle for SUI exposure, but investors must recognize the substantial risk factors, including volatility, regulatory uncertainty, operational dependencies, and potential trading price mismatches. The ETF’s structure, reliance on third parties, and exposure to staking and digital asset market dynamics mean shareholders could experience significant price movement or losses. Recent uplisting to NYSE Arca has improved price tracking, but historical challenges indicate ongoing risks.

Disclaimer

This article is for informational purposes only and does not constitute investment advice. The risks highlighted may significantly impact GSUI share prices and investor outcomes. Investors are advised to conduct their own due diligence and consult with financial professionals before making investment decisions. Past performance is not indicative of future results.