Sui Validators Approve $162M Return to Cetus After Exploit

Sui's latest price was $3.22, down 8.873% in the last 24 hours. Validators representing nearly 91% of Sui stake approved an on-chain proposal to release about $162 million seized during last week’s Cetus exploit, allowing the DEX to reimburse users and restore full operations. The 48-hour referendum closed on May 29 when more than two-thirds of the network endorsed the measure. The approved transaction instructs validators to transfer the frozen tokens to a multi-signature wallet controlled by Cetus, security auditor OtterSec, and the Sui Foundation. The foundation confirmed the outcome and said the funds will remain in trust until Cetus executes its repayment plan. “Protocol governance is only possible through your active participation,” the foundation told stakers and node operators, crediting them for concluding the vote swiftly. The decision resolves a key uncertainty that followed the May 22 attack, which drained an estimated $223 million in liquidity. Attackers bridged roughly $61 million to Ethereum before validators halted the address, leaving $162 million stranded on Sui. Cetus told users on May 27 that it could cover the bridged amount through its reserves and a short-term loan from the foundation, but it needed the community’s consent to unlock the frozen balance. Cetus outlined an eight-step recovery schedule, targeting a complete relaunch within one week. Validators will first execute the protocol upgrade, which transfers the locked assets into the tri-party wallet. Engineers have already completed an emergency update to the concentrated-liquidity market-maker contract and sent it for audit. The team will then restore pool data, calculate individual liquidity deficits, and convert the retrieved tokens back to their original composition. Because attackers executed extensive swaps during the exploit, Cetus plans to use “minimal-impact strategies” to avoid further slippage while rebalancing pools. Developers are creating a compensation contract that will distribute any unrecovered amounts once the auditors complete their review. Cetus is committed to transparent progress reports during the recovery week and stated that staff are “fully mobilized” to meet the timeline. Funds will be transferred to the multi-sig wallet once the validators finalize the upgrade, clearing the way for Cetus to reimburse users and bring its exchange back online. A $200 million-plus exploit targeting Cetus, a decentralized exchange on the Sui network, has reignited debate over decentralization in blockchain protocols after Sui validators collectively froze $162 million of the stolen funds. Some decentralization advocates called foul, criticizing Sui validators’ ability to pause fund transfers on the blockchain as a sign of centralization. Other investors applauded the rapid response and coordination against the attackers. Industry watchers are now waiting for Cetus to initiate its recovery roadmap after the Sui governance vote for returning the frozen $162 million was passed on May 29. Sui validators approved a governance proposal to return $162 million in frozen assets linked to a recent exploit of the decentralized exchange Cetus, marking a key step toward full user repayment. Cetus was exploited for over $220 million worth of digital assets on May 22, but validators managed to freeze $162 million of the funds shortly after the incident. In a governance vote concluded on May 29, Sui validators passed the recovery proposal with 90.9% voting in favor, 1.5% abstaining and 7.2% not participating, according to the network’s official governance page. “With this result, the impacted funds will be moved to a multisig wallet and held in trust until they can be returned to users according to the plan led by Cetus,” Sui said in a May 29 X post. The decision follows debate within the crypto community over the role of validators in freezing onchain funds.

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