The Sui Foundation is investing $30 million in the network, a position the two foundations call the largest institutional stake in it, and the DATA token carries over one to one. No date has been set for switching the existing chain off.
The DATA Foundation and the Sui Foundation said on Monday that the DATA Network will be rebuilt to run as a protocol on Sui and that its own blockchain will be switched off. The Sui Foundation is putting $30 million into the network as part of the move, a position the announcement calls the largest institutional stake in it.
DATA Network is the project that until June was Story Protocol, a layer 1 built around intellectual property licensing. It rebranded as the DATA Foundation on June 25, refocused on AI training data, renamed its IP token DATA and launched Trace, a registry that records where a training dataset came from and what it is licensed for. The product stays; the chain underneath it goes.
Neither foundation disclosed the terms. The announcement gives no valuation, no figure for the size of the stake in tokens and no disbursement schedule, and it does not say whether the $30 million has been transferred. The Sui Foundation's holding sits alongside positions that PIP Labs and the DATA Foundation are keeping.
For holders, the stated terms are that DATA carries over one to one, that their economics and governance rights will be at least equivalent to what they have now, and that locked and vesting positions carry over unchanged. The existing network keeps running until the upgrade is finished, and the announcement says "a detailed timeline and holder transition plan will be published prior to the upgrade." No shutdown date has been set.
Walrus, the decentralized storage layer in the Sui ecosystem, becomes the default storage for DATA Foundation applications. Trace is to keep an encrypted copy of each contributed file there, readable only by licensed buyers, as a reference a buyer can check a record against. That changes what the registry does rather than only where it runs: a provenance registry attests that a file existed in a particular form, and the stated plan is for it to also hold the file.
What the announcement does not describe is how the applications already running on DATA's chain get across. Crypto Briefing reported that DATA's environment and Sui's programming model differ enough that applications such as Kled and Numo need a path to keep operating, and no such path is set out. The transition plan the foundations have promised is the document that would answer this, and it has not been published.
The usage figures in the announcement come from the arrangement itself rather than from an audit. The foundations say Trace has registered more than 250 million contributions since launching in June and averages more than 3 million receipts a day, and that Kled, which they describe as the largest opt-in human data marketplace, is onboarding more than 1.5 billion records.
SY Lee, chairman of Poseidon and chief executive of PIP Labs, is joining the Sui Foundation as a strategic adviser. "The next generation of AI will be trained on data that lives with people rather than on the open web," he said in the announcement, which also quotes him calling the Sui Foundation the network's largest strategic holder. Adeniyi Abiodun, co-founder and chief product officer at Mysten Labs, said "the AI industry has reached the point where the open internet has been read."
A chain concluding that it should not be a chain is no longer unusual. Two Ethereum layer 2s announced shutdowns within four days of each other this month, Blast because the cost of running it had overtaken what it earned and Igloo because Abstract had cost tens of millions and will close on December 15. DATA's case differs in the way that matters most to holders: money is coming in rather than running out, the token continues, and the protocol moves rather than stops.
It also differs in what is not said. Blast and Igloo both gave the cost of running a chain as their reason. The reasons in this announcement are about capability, Sui's throughput and Walrus's capacity for large datasets, and nothing in it addresses what DATA's own network cost to operate.
For Sui, the deal lands in a run of announcements this month that bring outside workloads onto the network. Samsung Electronics America said on October 7 that Samsung Wallet will let eligible US users send USDC in the last week of October, and Sui said the following day that it had been selected as the wallet's blockchain infrastructure partner, with the transfers moving over its network.
Until the transition plan appears, the parts of this that a DATA holder can act on are the one-to-one carryover and the commitment that vesting schedules do not change. The date the chain goes off is still unannounced.
