Sui Validators Freeze 73% of Cetus Hack Funds

In a significant development within the cryptocurrency ecosystem, validators on the Sui blockchain have successfully frozen a substantial portion of the funds stolen in a recent hack targeting the decentralized exchange (DEX) Cetus. The hack, which occurred on May 22, resulted in the theft of approximately $223 million in user funds. According to the Cetus team, $162 million of the stolen funds have been frozen, leaving $58 million still at large. The Cetus team, in collaboration with the Sui Foundation and other stakeholders within the Sui ecosystem, is actively working to recover the remaining funds and return them to the affected users.

The hack was executed through a smart contract code exploit, which allowed the attackers to drain the DEX of user funds. The Extractor Web3 security notification tool identified that $63 million of the stolen funds were bridged to the Ethereum network. Additionally, a wallet address ending in "AF16" was used by the threat actors to launder 20,000 Ether (ETH), valued at roughly $53 million. The Cetus team and the Sui Foundation have confirmed that a large number of validators have identified the addresses containing the stolen funds and are ignoring transactions on those addresses until further notice. This coordinated effort aims to prevent the further movement of the stolen assets and facilitate their recovery.

The recovery efforts have sparked a range of reactions within the crypto community. While many users have expressed relief that a significant portion of the stolen funds has been frozen, others have raised concerns about the decentralization and censorship resistance of the Sui network. One user commented, "Good news for the victims, but if validators, only 114 in total, can freeze wallets when they want, it raises a major question about the network's censorship resistance. Sui is anything but decentralized." This highlights the ongoing debate within the crypto community about the balance between security and decentralization.

The Cetus hack is the latest in a series of high-profile incidents impacting the crypto and Web3 sectors in the first half of 2025. Cybersecurity remains a critical issue, with industry executives calling for the sector to enhance its defenses and establish more robust security measures. The ability of validators to freeze stolen funds demonstrates the potential for collaborative efforts within the ecosystem to mitigate the impact of such attacks. However, it also underscores the need for continuous improvement in security protocols to protect user funds and maintain trust in the decentralized finance (DeFi) ecosystem.