Original Author: Alex, Defi Researcher

“When NAVI reached a $1 billion TVL in September 2025, our largest single depositor had already supplied over $30 million.”

During an X Space event prior to the release of NAVI Prime, NAVI founder Elliscope recalled this milestone. For a lending protocol, $30 million not only meant scale, but also signaled an entirely different set of questions emerging.

“As we grew to that point, we started asking ourselves, if we want to further scale to $5 billion, $10 billion, or even $1 trillion, large capital providers would first inquire: Who is managing the risk? Where is my capital being deployed?”

Users with a few thousand dollars may first compare APYs; as the fund size rises to tens of millions of dollars, the conversation often shifts to risk parameters, asset destinations, and management responsibilities.

To address this issue, in August 2026, NAVI officially launched NAVI Prime, positioning it as the Sui's first module-based capital market introducing professional curators. Unlike the shared liquidity pools NAVI had been running for the past three years, NAVI Prime splits different lending relationships into separate markets, which are then curated by professionals responsible for asset due diligence, parameter design, and fund allocation.

This upgrade is not simply about adding more yield pools. It seeks to answer a more pressing question: as DeFi funds no longer just chase yields, how can protocols inform users where their returns come from, what risks they are taking, and who is ultimately in charge?

Three Years, from $0 to $1 Billion TVL: Beyond Scale, Sustainability Matters Most

In the Sui ecosystem, NAVI is no longer a new project.

According to data provided by the project team, since its launch in 2023, NAVI has processed approximately $30 billion in total borrowing volume and around $10 billion in total deposit volume, serving over 1 million users; it has reached a TVL peak of over $1 billion, once accounting for over 40% of Sui's total TVL, and has been running continuously for over 1000 days.

Over the past three years, the platform has distributed over $60 million in incentives and generated nearly $30 million in protocol revenue. While the two sets of figures are not directly comparable due to different measurement metrics, they collectively demonstrate NAVI's presence in the early DeFi market of Sui.

Against the backdrop of projects in the same period facing shutdowns, integrations, and mergers, NAVI has maintained its position as one of the core lending markets in the Sui ecosystem. Supporting this system is a team of about 20 people, based in Palo Alto with members distributed across San Francisco and New York. The core team members come from tech companies and financial institutions such as LinkedIn, Apple, Bank of America, as well as the Sui ecosystem development team. In 2023, NAVI secured a joint investment from Hashed, OKX Ventures, and Dao5.

As NAVI Prime is released, Ryan Kim, the founder of Hashed, South Korea's largest cryptocurrency investor, attributes this experience to "long-term construction across cycles."

"Since 2020, DeFi has experienced drastic fluctuations, but NAVI's lending protocol has built a moat around Sui. Supporting long-term builders like Elliscope and the NAVI team who cross market cycles is a core value of Hashed. We are excited to see them seize this opportunity to expand the institutional business landscape."

These data and endorsements indicate that NAVI has been able to attract liquidity. However, for NAVI Prime, the next stage truly needs to prove not just the ability to attract funds but whether they can make the funds see why they should stay.

From Shared Pools to Curated Markets: Why the Larger the Scale, the More Risk Needs to be Unpacked?

Shared liquidity pools are one of the early key infrastructures in DeFi lending. Users deposit assets into the protocol, and different lending demands share liquidity, allowing funds to be utilized more efficiently.

For Sui, which just started in 2023, this was a reasonable choice. At that time, the asset types within the ecosystem were limited, and consolidating liquidity was far more efficient than establishing a market for each asset individually.

However, shared liquidity also means that multiple assets and lending behaviors are put into the same system. Even though different assets can have different parameters, risks may still interact through shared liquidity and liquidation relationships. For regular users, this risk is often compressed into a simple APY; for large funds, whether "the entire protocol is secure" is too general.

In a recent X Space event, Elliscope drew a clear line:

"If I ask someone to try out the product with $100,000, their first question is usually about the yield. But if I ask an institution to deploy $10 million or $30 million, its first question will definitely be about risk management: how does the platform manage risk, who are the other participants, and how is liability divided."

Mysten Labs Head of On-Chain Finance Shaan Varia also shared a similar assessment in the interview. Prior to joining Mysten Labs, he spent five years leading the product team at the DeFi risk management firm Gauntlet. Unlike a typical ecosystem or business perspective, this experience has allowed his assessments to align more closely with the issues institutions face when actually allocating funds.

At Gauntlet, risk management isn't about slapping a protocol with a "safe" or "risky" label; instead, it involves placing on-chain market data, borrower positions, asset liquidity, and smart contract mechanics into a simulation environment. Parameters such as LTV, liquidation thresholds, asset caps, and interest rates are stress-tested repeatedly. Shaan has previously explained in Gauntlet's methodology articles that their system runs thousands of simulations daily, searching for optimal parameter combinations between protocol solvency risk and capital efficiency; Gauntlet's framework has also been widely used for risk management in mainstream lending protocols like Aave and Compound.

“For institutions, the core issue is risk management. When they enter the on-chain world, they are usually looking for two things: a broader market inaccessible by their current capital base and new structured products with specific risk, return, and liquidity characteristics.”

Therefore, when Shaan at X Space dissects economic risk, oracle risk, smart contract risk, liquidity risk, and solvency risk layer by layer, he is discussing not just whether Sui can attract institutions but a more specific question: whether this on-chain ecosystem is capable of allowing institutions to select assets according to their risk policies, control exposure, and continuously monitor allocations.

This is precisely the issue NAVI Prime seeks to address: no longer requiring all funds to accept a bundled risk set but allowing funds to choose the portion of risk they are willing to bear.

NAVI Prime is not simply about "pool fragmentation" but a redefinition of responsibilities

NAVI Prime's structure can be summarized by three key words: Segregated Markets, Professional Curation, and Modularity.

Segregated Markets mean that different collateral types and borrowing relationships are placed in relatively independent markets. Each market has its own interest rate model, collateralization ratio, liquidation parameters, and risk boundaries. When a certain type of collateral encounters issues, the potential impact is initially contained within the corresponding market rather than naturally spreading across all liquidity.

Professional Curation means that markets are no longer managed entirely by the protocol. Curators must research assets, conduct due diligence, set risk guardrails, choose configurable markets, and continuously monitor fund utilization and risk changes.

Modularity implies that these markets and curation strategies can be further integrated by treasuries, structured products, or other DeFi protocols without having to build a lending protocol from scratch.

In this structure, the responsibilities of three types of participants are clearly defined:

•  Liquidity Providers choose specific markets or curation strategies, deposit stablecoins or other assets, and earn corresponding lending returns;

•  Curators are responsible for asset due diligence, risk parameters, fund allocation, and ongoing monitoring;

•  NAVI provides isolated markets, permission systems, and underlying lending infrastructure.

For users, the significance of this change is that deposit decisions are no longer just "whether to enter NAVI" but further evolve into "which market to enter, what collateral risk to accept, which curator to choose".

In other words, users are no longer passively inheriting a bundled mixed risk in a shared pool but can actively choose their risk profile.

For Liquidity Providers, what is more important than the highest APY is that the return can be explained

NAVI Prime does not promise that all markets are safer, nor does it mean that all isolated markets can provide higher returns. It addresses something else: allowing different risks not to be roughly priced with the same set of generic parameters.

NAVI co-founder Charles gave an example using SUI and vSUI in Space.

Imagine two markets: one where a user borrows USDC with SUI as collateral; and another where a user borrows vSUI with SUI as collateral, used for leveraged liquidity staking strategy. The former involves price fluctuations between volatile assets and stablecoins, while the two assets in the latter are highly correlated, so the collateralization ratio and liquidation parameters required are not the same.

In a shared pool, the protocol must consider multiple lending relationships simultaneously; in isolated markets, the two strategies can use parameters that are more suitable for their own risk characteristics. Following Charles' example in the interview, the LTV for borrowing USDC against SUI collateral is about 70% to 80%, while in the highly correlated SUI and vSUI market, the LTV can be supported up to about 92% to 95%.

“The shared pool has tried various mechanisms to reconcile these differences, but market isolation provides a clearer solution. NAVI Prime can create two independent markets, each tailored to its specific use case.”

A higher LTV does not inherently equal more safety, nor does it necessarily bring higher returns. This example truly illustrates that when different lending relationships are unbundled, funds can be more finely allocated based on the correlation between specific assets and the liquidation risk.

For liquidity providers, the most important change is not seeing a few more yield numbers on the page, but being able to answer four questions before entering:

1.  Which market will my funds enter?

2. What assets are borrowers using as collateral?

3.  Which markets and liquidity risks does the current yield correspond to?

4. Who is responsible for setting parameters, monitoring the market, and adjusting allocations?

When yield can be explained, users can more easily determine if it suits them; and when risk can be chosen, large funds are more likely to turn a trial into a long-term allocation.

Three-Tier Security Architecture: Security is Not Without Risk, but Risk is More Visible and Controllable

In DeFi, “security” cannot be established with just a promise. Smart contracts, oracles, liquidity, collateral pricing, and governance can all become sources of risk.

Charles broke down NAVI Prime's risk management framework into three layers in Space.

The first layer is smart contract security. According to the project team, NAVI Prime's underlying isolated market contract is built on NAVI's lending infrastructure that has been running since 2023, with cumulative audits from 5 audit firms, over 10 audit rounds; the curation layer has additionally undergone 2 audits.

The second layer is collateral risk isolation. If a market only accepts specific assets as collateral, liquidity providers can better understand the risk they are taking on, whether it's in Bitcoin, SUI, stablecoins, or other assets. When a certain collateral experiences anomalies, the isolation design can mitigate the potential impact.

The third layer is Curator Accountability and Permissioning. NAVI Prime separates roles such as administrators, curators, and fund allocators. Curators can update markets and parameters within their authorization scope, while allocators can only move funds between pre-approved markets; mechanisms like time locks provide additional buffering for key changes.

“This three-layer architecture is designed to make NAVI Prime as secure as possible,” Charles said.

“As secure as possible” doesn't mean zero risk. More precisely, NAVI Prime aims to turn the originally vague security assessment into a set of checkable questions: Has the contract been audited, what collateral is accepted, who holds permissions, how parameters change, and how extensive a single risk event might impact.

This is also a core part of NAVI Prime's attractiveness to funds: It doesn't require users to blindly trust the platform but rather seeks to help users understand what they are trusting.

For Curators, Risk Management Capability Can Now Become a Product for the First Time

Another growth path for NAVI Prime doesn't come from more collateral but from more professional managers.

In the traditional model, risk agencies usually advise protocols on parameters as consultants; in a curation-style market, curators can create markets based on their understanding of assets and strategies, set risk boundaries, allocate funds, and continuously manage performance.

This means that a curator’s asset research, risk models, and fund allocation ability can be packaged into an on-chain product that users can directly choose.

A curator skilled in stablecoin strategies can create a conservative market; a team understanding Bitcoin liquidity, RWAs, Sui ecosystem assets, or structured strategies can design independent risk-return schemes around the corresponding assets. What users ultimately choose is not just a set of assets but also the curator’s judgment and management ability.

For potential collaborators, the value NAVI Prime offers is not just a market creation tool. Curators can use NAVI's underlying infrastructure and access its existing user base and liquidity pool without having to redeploy lending contracts, liquidation systems, and permission frameworks.

Elliscope explicitly stated in Space that NAVI aims to collaborate with professional curators who understand specific markets, possess risk management capabilities, and build a more cooperative ecosystem through revenue sharing.

“NAVI Prime is more accessible to institutions capable of deploying hundreds of millions of dollars in liquidity because it offers risk isolation and manageable configuration options. It also welcomes professional curators who understand specific markets and can manage risks. We aim to share revenue, attract a broader range of skills, and bring more capital into Sui.”

For NAVI, this means the platform no longer solely determines all markets; for curators, professional skills have the opportunity to shape products, brands, and revenue; for users, it means they can choose between different managers and different risk-reward schemes.

Why Sui: From Retail-Driven to Coexistence of Institutions and Retail

The relationship between NAVI and Sui can be traced back to 2023. At that time, the Sui ecosystem was still in the early stages of infrastructure development, with bridges, liquidity, and lending markets needing to be built from scratch.

Over the past three years, Sui has helped early DeFi projects grow through incentives, technical support, and ecosystem resources; at one point, NAVI contributed over 40% of the TVL across the entire Sui network. The relationship between the two parties has also shifted from early ecosystem development to how to meet larger scale and more complex funding needs.

From Mysten Labs' perspective, Shaan sees NAVI Prime as a new type of infrastructure that can support structured products:

“NAVI Prime allows teams to leverage Sui’s performance and scalability, as well as the latest innovations in DeFi market design, to reach institutions. Users have more choices, institutions have more precise control over allocations, and more capital can enter the Sui ecosystem.”

This is not a forward-looking statement. Over the past year, Sui has successively introduced various types of on-chain assets and financial products with institutional attributes: Figure deployed SEC-registered revenue-sharing security YLDS to Sui; Matrixdock brought redeemable tokenized gold XAUm into the ecosystem; R25 launched rcUSD and revenue-based rcUSDp backed by real-world financial assets; on August 18, 2026, Securitize and Neuberger launched the tokenized high-yield fixed income fund HINC on Sui. Meanwhile, Hashi is attempting to bring native Bitcoin into on-chain lending and explicitly open up related financial services to institutional and retail participants.

Beyond assets, Sui has also begun to complement regulated market infrastructure. On August 25, tZERO announced the expansion of digital securities infrastructure covering issuance, custody, transfer agency, trading, and settlement to Sui. This means that Sui's institutionalization is no longer just about having ‘one more tokenized asset,’ but is beginning to cover the entire lifecycle of assets from issuance and holding to trading and settlement.

These assets entering Sui's infrastructure have only taken the first step. Tokenizing assets does not mean they have formed a complete on-chain financial market. They still need to be priced, used as collateral, acquire liquidity, generate lending demand, and further enter leverage, yield, and structured products.

This is precisely the role of the lending infrastructure: turning "an asset being on-chain" into "this asset can be continuously utilized by capital."

Charles in Space made the relationship between RWAs and lending more explicit:

"Once on-chain, RWAs can also be used for lending, leverage strategies, short positions, and other structured products. This opens up significant product innovation space. Lending will be foundational as many of these products require using RWAs as collateral."

However, institutional assets and retail assets cannot be simply mixed together. Some RWAs have investor qualifications, KYC, geographic restrictions, and redemption rules; Bitcoin, gold, income-bearing securities, and Sui ecosystem tokens also have completely different price, liquidity, and settlement characteristics. Segregated markets allow each asset to have its own entry requirements, oracle, LTV, supply cap, and curator without requiring all users to share its risk.

Therefore, the significance of NAVI Prime to Sui is not to let institutions replace retail, but to provide a set of executable structures for the coexistence of two types of funds:

•  The shared pool continues to serve open, standardized, and highly liquid retail lending;

•  Prime can provide independent risk boundaries for institutions, large funds, professional curation strategies, and restricted RWAs;

•  The curation treasury for ordinary users can package complex market research and allocation processes into more easily understandable products, while still maintaining on-chain transparency of fund allocation and risk parameters.

Institutions may bring larger-scale assets and funds, while retail users provide broad distribution, liquidity, and real usage demand. The two do not necessarily enter the same market but can find their suitable positions in the same infrastructure.

In the aftermath of a recent discussion on DeFi with mysten, the DeFi lead of the X Space ecosystem, Elliscope used a building to describe the significance of lending to an ecosystem:

"The trading volume of DEXs and perpetual contracts indicates how fast this building has grown; but lending determines how tall this DeFi skyscraper can ultimately be."

Transaction activity may fluctuate rapidly with market sentiment, while lending supports longer-term capital allocation, leverage, and financial products. The goal of NAVI Prime is to ensure that as this building continues to rise, it not only has more funds but also a clearer risk structure, allowing different types of capital to enter the Sui without sacrificing their risk preferences.

Next Phase: Enabling Institutional Assets to Find Liquidity, Empowering Retail Capital

The launch of NAVI Prime does not mean that the shared pool is obsolete. For standardized, large-scale basic borrowing needs, shared liquidity still holds significant value. Curated isolated market solutions address a different set of issues: diversified assets, specific risk preferences, institutional allocation, RWA, and specialized strategies.

With a three-year $300 billion loan volume, over 1 million users, a peak TVL of $1 billion, and Sui accounting for over 40% of the network's TVL, NAVI has proven its ability to attract funds.

What NAVI Prime now needs to demonstrate is its ability to translate this scale into a two-way market: on one side, enabling institutional assets, Bitcoin, and RWAs to find manageable on-chain liquidity and borrowing scenarios; on the other side, allowing ordinary users to choose risk/reward schemes managed by professional curators within a transparent boundary without needing to research each underlying market themselves.

For users, the real attraction is not just a "safe and high-yield" statement but the ability to see where funds are going, the risk boundary, and a revenue source, and to choose markets and managers based on their risk preferences within a transparent framework.

For institutions, the key is not only to achieve a higher APY but to maintain sufficient control over custody, access, collateral, parameters, and permissions, gradually turning an experimental allocation into long-term capital.

For curators, true collaboration is not a one-time branded partnership but the ability to leverage NAVI's market infrastructure, user base, and liquidity gateway to turn professional capabilities into a product that can consistently attract funds, accumulate on-chain performance, and generate revenue.

This is also the broader significance of NAVI Prime for Sui: it does not transition the ecosystem directly from the "retail era" to the "institutional era" but adds an institutional capital track on top of the existing retail liquidity. The shared pool and Prime, open markets and restricted markets, ordinary users and professional allocators can coexist within different risk boundaries.

From shared pools to curated markets, what NAVI Prime aims to achieve is precisely this: ensuring that funds are not just attracted but also know why they stay; assets are not just issued on-chain but truly enter a lendable, allocatable, and combinable financial system.

This article is a contributed piece and does not represent the views of BlockBeats.

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