Cetus Protocol proposes full repayment of $223M exploit losses pending community vote
Cetus Protocol ready to fully reimburse exploit losses
Cetus Protocol has announced its readiness to fully cover user losses from the recent $223 million exploit, using a combination of its cash and token reserves as well as a line of credit from the Sui Foundation—pending a community vote.
The decentralized exchange (DEX), which suffered a major attack on May 22, says that the method of compensation will be determined by its community through a governance vote.
“By leveraging our cash and token treasuries, we are now in a position to fully cover the stolen off-chain assets—should the locked funds be recovered via the upcoming community vote,” Cetus stated Tuesday on its X account.
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A technical post-mortem revealed the exploit stemmed from a flaw in a math library, which allowed the attacker to manipulate token pair prices. The vulnerability impacted trading pairs involving CETUS, SUI, and USDC. Over $60 million was bridged to Ethereum and may have been laundered, while another $160 million remains locked in SUI addresses.
Decentralization vs. Pragmatism
The community vote will also decide how to handle the compromised SUI addresses. Some users argue that reversing the hack undermines the decentralized ethos of the blockchain, while Cetus maintains that this is a necessary and exceptional step to protect affected users.
“We understand this is an extraordinary request caused by our own vulnerabilities, but we believe it is the right move for those impacted,” the Cetus team stated.
Cetus is hoping for a positive outcome in the community vote. The team is also awaiting a response from the attacker, whose wallet addresses have been blacklisted on the SUI network. A white-hat deal offering $5 million was proposed the day after the exploit, but the hacker has yet to respond. Legal action was also threatened, with no visible result so far.
As we wrote, Cetus offers $5M to hacker after $223M DEX exploit
