- $162M Recovery Approved: Sui validators voted to approve a special transaction that will return $162 million in frozen assets from the Cetus hack to affected users, following a majority vote with over 52% stake support.
- SUI Price Rallies 7%: News of the recovery plan boosted investor confidence, causing the SUI token to surge 7%, trading at $3.68 shortly after the announcement.
- Centralization Debate Ignites: While praised for its swift response, the decision to freeze funds without broader community input has raised concerns about centralization in the Sui ecosystem.
The Sui blockchain community has voted to reclaim $162 million frozen in the wake of a devastating hack on Cetus, its top decentralized exchange. The attack, which occurred on May 22, exploited fake tokens to manipulate pricing mechanisms, resulting in a $223 million loss. While $60 million was swiftly laundered to Ethereum, Sui validators acted fast, freezing $162 million worth of compromised funds on-chain.
A formal proposal, titled “Whether to Return Stolen Assets of the Cetus Protocol Through a Special Transaction,” gained over 52% support from validator stakers. The plan, now approved, authorizes the transfer of the frozen assets to a multisig wallet managed by the Sui Foundation and blockchain security firm OtterSec. This wallet will oversee the fund distribution to affected users.
Validator Vote and Technical Execution
Voting began on May 27 and remains open until June 3, though the majority threshold has already been met. Only Sui validators can vote, with their stake weight determining the outcome. Notably, the Sui Foundation abstained from voting, maintaining neutrality throughout the process.
If the plan receives final technical approval, Sui’s next upgrade will include two hard-coded transactions to move the assets from the hacker-controlled wallets to the recovery wallet. This strategic approach ensures secure, verifiable restitution and marks one of the largest recovery operations on a Layer 1 blockchain.
SUI Price Jumps 7%, But Critics Worry About Centralization
News of the recovery decision triggered a 7% surge in SUI’s price, bringing it to $3.71. Market sentiment reflected optimism in the chain’s rapid response and its user-centric approach. However, the move has ignited debate within the crypto community over decentralization principles. Critics argue that the ability to freeze and redirect funds—without broader community consensus—challenges the ethos of a trustless network.
Despite the criticism, the Sui Foundation insists the move was necessary to protect user funds and maintain ecosystem integrity. As the recovery plan moves into its next phase, the crypto world watches closely, weighing the benefits of swift action against the risks of centralized control in decentralized finance.
Also Read: Nasdaq Files for 21Shares Spot SUI ETF, Launching SEC Review Process
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
