10-Q: 21Shares Sui ETF Reports Q2 2026 NAV Decline Amidst SUI Price Drop

21Shares Sui ETF's Q2 2026 report shows a 16.26% decrease in Net Asset Value, primarily driven by a significant decline in SUI's price and realized losses from asset sales.

Summary

• The 21Shares Sui ETF (TSUI) reported a Net Asset Value (NAV) of $12,637,858 as of June 30, 2026, a decrease of 16.26% from the previous quarter.
• This decline was largely attributed to a 20.45% drop in the price of SUI, from $0.88 to $0.70 during the quarter.
• The Trust experienced a net decrease in net assets from operations of $(3,362,720) for the three months ended June 30, 2026.
• Key contributors to this decrease were unrealized depreciation on SUI investments ($2,203,432) and realized losses from selling SUI for redemptions ($1,160,477).
• The Trust generated $46,205 in staking rewards during the quarter, offset by $11,228 in Sponsor Fees and $11,551 in Staking Fees.
• The Trust made cash distributions totaling $53,101 to shareholders during the quarter.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this as a negative score due to significant unrealized depreciation and realized losses impacting the net asset value, despite some staking rewards.

Positives

• The Trust generated $46,205 in staking rewards during the three months ended June 30, 2026.
• The Trust made cash distributions to shareholders totaling $53,100.67 during the quarter.
• The Sponsor has agreed to cover ordinary operating expenses, limiting the Trust's direct expense burden.
• The Trust intends to operate as a grantor trust for U.S. federal income tax purposes, with a safe harbor for staking provided by the IRS.

Negatives

• The Net Asset Value (NAV) decreased by 16.26% to $12,637,858 as of June 30, 2026.
• The price of SUI declined by 20.45% during the quarter, from $0.88 to $0.70.
• The Trust incurred a net decrease in net assets from operations of $(3,362,720) for the quarter.
• Significant unrealized depreciation on investment in SUI amounted to $(2,203,432).
• Realized losses on SUI sold for redemptions were $(1,160,477).
• The total return for the three months ended June 30, 2026, was a negative 20.60%.

Risks

• The Trust's investment strategy is concentrated in a single asset (SUI) within a single asset class, maximizing exposure to market risks associated with SUI and digital assets.
• Any losses resulting from a decrease in SUI's value will directly reduce the Trust's value without offsetting gains from diversification.
• The unbonding period for staked SUI could potentially limit the Trust's ability to meet redemption requests.
• There remains a risk of adverse regulatory or legal determinations regarding the tax treatment of the Trust as a grantor trust, particularly concerning staking.
• The termination of the licensing agreement for the CME CF Sui - Dollar Reference RateNew York Variant (Pricing Benchmark) and the transition to FTSE index data introduces potential operational adjustments.

Future Outlook

The Sponsor intends to enter into a licensing agreement with FTSE on or about August 24, 2026, for index data, which is not expected to materially impact the Trust's NAV, fair value, or results of operations. The change in pricing benchmark provider will be applied prospectively.

Management Comments

• The Sponsor believes that the change in pricing benchmark provider is not expected to have a material impact on the Trust's net asset value, the fair value measurement of the Trust's SUI, or the Trust's results of operations.
• The Sponsor believes that all adjustments necessary to present fairly the financial position and results of operations for the interim periods have been made.
• The Sponsor believes the risk of loss under indemnification arrangements is remote.

Industry Context

StockSavvy.ai notes that the performance of the 21Shares Sui ETF is directly tied to the volatile digital asset market, specifically SUI. The shift in pricing benchmark providers is a common occurrence in the evolving digital asset ETF landscape as providers seek robust and reliable data sources.

Legal Proceedings

• As of June 30, 2026, the Trust was not subject to any material legal proceedings, nor are any material legal proceedings threatened against the Trust.

Related Party Transactions

• The Sponsor, 21Shares US LLC, is a related party to the Trust.
• The Sponsor purchased Seed Creation Baskets on February 23, 2026, for $348,574, which were redeemed on March 4, 2026.
• As of June 30, 2026, the Sponsor did not own any Shares of the Trust.
• The Trust pays a Sponsor Fee of 0.30% of the Trust's NAV to the Sponsor.
• The Trust pays a Staking Fee of 25% of the staking rewards (after Staking Provider Consideration) to the Sponsor.

Stakeholder Impact

• Shareholders experienced a significant decrease in the Net Asset Value per Share during the quarter.
• Shareholders received cash distributions totaling $53,101 during the quarter.
• The concentration risk in SUI means that any downturn in the digital asset's performance directly impacts shareholder value.
• The Sponsor, as a related party, receives fees for its services, impacting the Trust's expenses.

Next Steps

• The Sponsor intends to enter into a licensing agreement with FTSE on or about August 24, 2026, for index data.
• The licensing agreement with the current Pricing Benchmark Provider is set to terminate effective August 31, 2026.
• The Trust plans to continue paying cash distributions to Shareholders at least quarterly, funded by staking rewards.

Key Dates

Recommendation

The filing indicates a significant decline in the Trust's Net Asset Value due to the underperformance of SUI, coupled with realized losses. The negative total return and ongoing market volatility in digital assets suggest a cautious approach, making 'sell' the appropriate recommendation for seasoned investors.

Keywords

21Shares Sui ETF, SUI, Digital Asset ETF, Quarterly Report, Form 10-Q, Staking Rewards, Net Asset Value, Cryptocurrency