Sui invests $30M as DATA Network shuts down its blockchain

Sui Foundation has announced a $30 million investment in DATA Network on October 12, becoming its largest institutional holder as the AI training data protocol prepares to move to Sui and shut down its independent blockchain.

Sui Foundation confirmed the agreement in an official announcement with DATA Foundation, explaining that the partnership will bring DATA Network and its Trace registry onto Sui’s blockchain infrastructure. The existing DATA token will migrate at a 1:1 ratio, while Walrus will become the default storage platform for applications operated by DATA Foundation.

The two organizations said the existing network will remain operational until the transition is completed. They have not announced a migration date, but plan to publish a detailed schedule and instructions for token holders before the upgrade.

Sui Foundation’s $30M investment brings DATA Network to Sui

Under the agreement, Sui Foundation will become DATA Network’s largest institutional investor, joining existing holders PIP Labs and DATA Foundation. The investment forms part of a strategic partnership designed to bring AI training data infrastructure onto Sui.

DATA Network currently operates its own blockchain, which supports applications involved in sourcing, tracking and licensing training information for artificial intelligence systems. Once the planned migration is completed, DATA Network will operate as a protocol native to Sui.

Its standalone blockchain will be retired, removing the need for DATA Foundation to maintain a separate network for the applications it supports.

According to the joint announcement, DATA tokens will transfer to Sui on a one-for-one basis. For every existing DATA token, the holder will receive one DATA token on the new network.

The foundations said token holders would retain economic benefits and governance rights at least equivalent to their current arrangements. Locked tokens and existing vesting schedules will transfer without changes under the announced plan.

However, the organizations have not disclosed the investment’s valuation, the exact number of tokens involved in Sui Foundation’s stake or the financial structure of the transaction. The announcement did not establish whether the full $30 million had already been transferred. Sui Foundation and DATA Foundation said they would publish further information about the holder transition before the migration begins.

Meanwhile, SY Lee, chairman of Poseidon and CEO of PIP Labs, will join Sui Foundation as a strategic adviser. Lee previously played a central role in the development of Story Protocol, which later became DATA Network. His advisory appointment was announced alongside the investment and technical partnership.

DATA Network plans to shut down its independent blockchain

DATA Network’s planned migration follows a major change in the project’s business strategy earlier this year. In June 2026, Story Protocol rebranded as DATA Foundation and changed its focus from general intellectual property licensing to AI training data.

The transition included renaming the original IP token to DATA and introducing a dedicated network for managing data ownership, licensing and payments.

As previously reported, the project had struggled to attract some large intellectual property owners because they wanted tighter control over their content and licensing arrangements. DATA Foundation subsequently concentrated its resources on infrastructure for sourcing and verifying information used to train AI models.

In its June 25 announcement, the organization explained that the new direction would focus on giving AI developers access to licensed information while tracking how contributors were compensated.

The October agreement takes the restructuring further by moving the protocol away from an independent blockchain. DATA Foundation said its existing network would continue processing transactions until the Sui migration is complete. The organizations have not published a shutdown date for the original blockchain.

They have not specified whether exchanges, custodians or other service providers will handle the token transition automatically. No mandatory action for token holders has been announced at this stage. The migration will require further technical and operational updates, with the foundations committing to release instructions ahead of implementation.

According to the official statement, the move will preserve DATA’s existing governance arrangements and token holder economics while transferring the protocol’s operations to Sui.

Trace records 250 million AI data contributions

The partnership brings DATA Foundation’s Trace registry to Sui. Trace launched in June 2026 as a blockchain-based system for recording the origins of information used in artificial intelligence training. The registry tracks the source of contributed data, the rights attached to it and the payments owed to the people who provide it.

According to DATA Foundation, Trace has registered more than 250 million contributions since launch. The organization reports that the system currently processes more than 3 million receipts per day on average. The figures were supplied by the foundation and have not been independently audited in the materials reviewed.

Applications using the registry include Kled, Numo and Oto. Kled operates a marketplace for people who choose to contribute information for AI development. The Sui announcement said Kled was onboarding more than 1.5 billion records, while Numo and Oto were supplying licensed information to AI laboratories and robotics companies. Trace creates records showing where information came from and the permissions attached to its use.

The foundation said contributors can receive payment when their data is licensed through participating applications. Through the planned upgrade, the registry will run on Sui while using Walrus for the storage of original files. Adeniyi Abiodun, co-founder and chief product officer at Mysten Labs, described the growing demand for properly licensed training information. “The AI industry has reached the point where the open internet has been read, and the next frontier is defined by access to datasets with the consent and provenance that regulators require.”

Abiodun said the partnership would bring existing data contributions and licensing activity to the Sui technology stack. His comments describe the companies’ intended application of the infrastructure, not an independently established guarantee about the quality or legal status of every dataset.

Walrus becomes the default storage platform for AI data

Under the agreement, Walrus will become the default storage layer for applications operated by DATA Foundation. Walrus is a decentralized data storage protocol developed within the Sui ecosystem.

While Sui records blockchain transactions and ownership information, Walrus is designed to store large files and make them available under specified access conditions. The companies plan to connect these capabilities so that AI training datasets can be registered, stored and licensed through the same technology stack.

According to the announcement, Trace currently records information about contributed files and their associated rights. After the integration, the system is expected to support encrypted copies of original datasets stored on Walrus. DATA Foundation said the arrangement would allow authorized users to verify records against the original information while maintaining restrictions on access.

The organizations described the planned storage system as a way to improve checks on whether a dataset has been altered after registration. Andrea Muttoni, CEO of DATA Foundation, said the project was moving beyond maintaining a transaction record.

He identified encrypted file storage and potential future verification tools for AI evaluations and model training as areas the organization intends to develop. Those additional functions remain part of the foundation’s development plans. Walrus has previously attracted investments and partnerships involving AI infrastructure.

In March 2025, Walrus Foundation secured $140 million in funding led by Standard Crypto, with participation from other digital asset investors. The financing supported the development of decentralized storage infrastructure linked to Sui, as covered in the Walrus Foundation’s $140 million funding announcement.

In June 2025, decentralized cloud provider io.net integrated Walrus for encrypted AI model storage, connecting the storage network with infrastructure used for AI training and deployment.

Sui has continued developing technology intended to handle high volumes of automated activity. On October 7, the foundation reported that programmable offchain tunnels reached 40,614,180 transactions per second during a demonstration at Sui Basecamp in Singapore.

The test involved offchain channels that settle to Sui mainnet, not ordinary mainnet transactions. CertiK independently observed the demonstration, while detailed results of the test remained subject to further review.

As reported in coverage of Sui’s offchain transaction test, the demonstration involved more than 10,000 tunnels supporting payments, games and messaging activity. For DATA Network, the next operational step is the publication of its migration schedule and token holder instructions. The foundations have committed to keeping the existing blockchain operational until the upgrade is completed, with locked and vesting DATA token positions transferring under their current schedules.