Recap with Scallop: Bridging Traditional Finance and DeFi on the SUI Blockchain

Coinstore recently hosted an insightful X Space with Johnny, the ambassador from Scallop, a pioneering DeFi protocol on the SUI network.

During this engaging conversation, Johnny shared valuable insights into how Scallop addresses critical pain points in today’s DeFi landscape, including fragmented liquidity, complex user experiences, and high transaction costs. As the first DeFi protocol to receive a grant from the SUI Foundation, Scallop has positioned itself as a comprehensive all-in-one DeFi service platform offering lending, borrowing, and swap functionalities.

This recap summarizes the key highlights from the discussion, covering Scallop’s approach to risk management, cross-chain liquidity solutions, token utility, user experience design, sustainable liquidity building, and future roadmap developments. Join us as we explore how Scallop is working to deliver a more efficient, secure, and user-friendly DeFi experience on the SUI network.

Kaden: What is Scallop, and what problems are you aiming to solve in the DeFi space?

Johnny: Basically Scallop is a DeFi protocol on SUI network and we have identified several pain points in today’s DeFi ecosystem which are fragmented liquidity, complex user experience and high transaction cost. Scallop is a platform designed to be more efficient, secure and user friendly by offering an all in one service. We do offer a landing and borrowing service and you can also do some swap on Scallop. We aim to provide users with the most convenient, best and secure experience on SUI network.

Kaden: Risk management is crucial in lending markets. How does Scallop underwrite or assess collateral health, especially in a volatile environment like Sui’s nascent ecosystem?

Johnny: We do implement various risk management mechanisms, like collateral segregation. For example, most users deposit their funds into our protocol. They cannot be used as collateral. We will check the collateral weight and also do some assessment before the token is listed on our platform. So that is security and safety are always our top priorities at Scallop.

Kaden: We’ve seen liquidity fragmentation across L1s. What is Scallop thinking about cross-chain liquidity and bridging without compromising UX or security? Are you building your own infra or partnering with bridge protocols?

Johnny: Currently scallop supports two bridges. The first one is Wormhole and the second one is SUI bridge. We highly recommend users bridge assets to SUI so they can try our products or others and it offers one of the best cross chain user experiences.

Kaden: How does $SCA create demand beyond speculative staking? Are there fee-sharing mechanisms, governance hooks, or utility loops that align long-term users and LPs with protocol growth?

Johnny: We use a Ve model like Curve to align our long term users with protocol growth. So if our users stake SCA, which is our native token, they can turn it into VeSCA. And VeSCA comes with multiple benefits like they can get up to four times boost borrowing rewards or they can access our loyalty program, which is kind of like a revenue sharing mechanism. They get 20% of our revenue when we achieve the milestones. For example, if our revenue is over 4 million, we will airdrop some tokens to our loyal users. You can get referral rewards. You can get more referral rewards by holding the VeSCA.

Kaden: What kind of user experience can people expect when they interact with Scallop?

Johnny: Scallop delivers two kinds of user interfaces. So for the pro traders, they can use our pro version, and for the rookies, they can use another version. And so we try to cater to all needs. So if you want to try to use the lending protocol, I think Scallop will be a nice choice for you.

Kaden: Many protocols rely heavily on emissions and token farming. How is Scallop building sustainable liquidity and avoiding the “mercenary capital” problem?

Johnny: We are currently working with more than two experienced market makers to ensure SCA has strong trading liquidity on all centralized exchanges, and this helps create a more stable and sustainable market environment.

Kaden: We’ve seen a rise in modular DeFi — protocols launching “money legos” in stages. Can you walk us through how Scallop is layering products: lending, AMM, and possibly vaults, options, or perps in the future?

Johnny: Right now, we are mainly focused on just building and operating our core product. That is the lending protocol. But we have also integrated with several top tier aggregators. Our vision is to deliver a comprehensive all in one DeFi service. So maybe in the future, we will either build or integrate more protocols to expand the whole scallop ecosystem.

Kaden: You’ve received a grant from the Sui Foundation — how has that influenced your roadmap, hiring, or go-to-market plan? Are you building anything unique to Sui’s ecosystem?

Johnny: Scallop is the first DeFi protocol that received a grant from SUI Foundation. And since the SUI Foundation is also one of our investors, we have been working closely with them on both the development side and marketing side. You might have heard of a protocol called walrus. That's a project developed by Mister Naps, and that just raised 140 million. And they’re gonna launch their token very soon and Scarlet will be supporting it from day one. So basically we work very closely with the SUI foundation.

Kaden: Johnny, for those who would like to get started with Scallop. So what is the easiest way to interact with Scallop today? Any suggestions on how they can join your community or maybe how they can get in touch with you guys?

Johnny: They can join our Telegram group, the discord group. And a lot of people are willing to share their insights or how to use our products. There are a bunch of ambassadors on Scallop, so you will get the solution or somebody will help fix your problems and just download the SUI wallet, get a SUI account and you can try our product.

About Scallop

Scallop is the pioneering Next Generation peer-to-peer Money Market for the Sui ecosystem and is also the first DeFi protocol to receive an official grant from the Sui Foundation. Emphasizes institutional-grade quality, enhanced composability, transparency, and robust security. Offers Lending/Borrowing, lending derivatives, Sui PTB building tools, flash loans, SDKs, and a UI for swaps and bridges.

About Coinstore

Accessibility. Security. Equity.

As a leading global platform for cryptocurrency and blockchain technology, Coinstore seeks to build an ecosystem that grants everyone access to digital assets and blockchain technology. With over 10 million users worldwide, more than 1,100 listed tokens including 100+ premium digital assets. Coinstore is dedicated to providing secure, professional, and accessible digital asset trading service.

As a pioneer in Launchpad, Coinstore’s Launchpad have shown remarkable performance, with an average ROI of prime exceeding 1,200%. Coinstore, the first choice for the initial launch.

Coinstore Social Media

Twitter | Discord | Facebook | Instagram | Youtube |
Telegram Discussion | Telegram Announcement