Following a significant security breach in the Cetus Protocol, the Sui Network has taken decisive and commendable action to protect users and stabilize its ecosystem. By committing to both user compensation and long-term security, Sui Network is setting a new standard for responsible blockchain governance and resilience.
What Happened to Cetus Protocol?
On May 28, 2025, Cetus Protocol, a decentralized exchange (DEX) built on the Sui blockchain, reported a major exploit. In this attack, a portion of user assets was stolen and bridged out of the Sui Network, triggering concern across the DeFi ecosystem.
In response on X , the Sui Foundation immediately issued a secured loan to Cetus to cover the affected users’ losses. Combined with Cetus’ own treasury, this fund is being used to ensure full compensation.
“We are providing Cetus with a secured loan to quickly repair the damage to users.” — Sui Foundation
This response showcases the Sui Foundation’s commitment to user protection and platform accountability.
Cetus Protocol’s Commitment to Recovery
Cetus Protocol has announced its readiness to cover all stolen assets, contingent upon the outcome of an upcoming on-chain community vote to release certain locked funds. The team emphasized that restoring user trust is its highest priority and promised a detailed reimbursement plan.
By being transparent and collaborative, Cetus is actively working to repair its reputation and rebuild confidence among users and developers.
Sui Network Launches a $10 Million Security Initiative
As a broader response to the hack, the Sui Network unveiled a $10 million fund dedicated to enhancing the security of its ecosystem. This initiative is not just reactive—it reflects a long-term strategy for strengthening DeFi protocols and supporting developers.
Key areas of the initiative include:
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Smart contract audits to proactively detect vulnerabilities
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Bug bounty programs to engage ethical hackers
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Advanced developer tools for building secure applications
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Security education programs to train developers in best practices
This initiative reaffirms that security is the backbone of sustainable blockchain growth.
Governance Vote Sparks Decentralization Debate
The proposal to release locked funds through an on-chain vote has triggered a broader discussion within the Sui community about decentralization versus user interest.
While the Sui Foundation has maintained neutrality, critics have expressed concerns about:
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Validator influence over governance
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Comparisons to Ethereum’s 2016 DAO rollback
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Potential erosion of blockchain immutability
This incident has reignited vital conversations around how governance in blockchain should evolve to preserve decentralization while remaining adaptable during crises.
Hacker Bounty Program Launched
In parallel with their compensation efforts, both Cetus Protocol and the Sui Foundation have launched a joint bounty campaign to track down the attacker and encourage community involvement in recovery efforts.
The rewards include:
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$6 million white-hat bounty from Cetus
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$5 million tip reward from the Sui Foundation
These incentives aim to involve ethical hackers and security researchers in locating vulnerabilities and identifying malicious actors, creating a community-driven defense network.
Market Reaction and Recovery Signs
The initial market response was sharp. The SUI token price dropped approximately 17.5%, falling from around $4.30 to $3.54 shortly after the incident. However, indicators of stabilization are beginning to emerge.
Notable recovery metrics include:
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Price stabilizing in the $3.40–$3.60 range
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Total Value Locked (TVL) in the Sui ecosystem showing growth
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Developer engagement remaining high
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User activity gradually rebounding
This resilience suggests that the Sui Network has retained user confidence, even amid a security setback.
A Teachable Moment for Blockchain Security
The Cetus exploit and the Sui Network’s reaction serve as a critical lesson for the broader blockchain and DeFi sectors. Rather than deflect responsibility, Sui chose to address the issue head-on with financial support, technical improvements, and community engagement.
Key takeaways:
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Security must be proactive, not just reactive
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User trust is the most valuable asset for a DeFi protocol
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Governance must be clearly defined and community-led
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Transparent communication helps maintain credibility during crises
In doing so, Sui Network has demonstrated that responsibility, not perfection, defines the future leaders of Web3.
Conclusion: A Defining Moment for Sui Network
The response to the Cetus hack illustrates that Sui Network is more than just a blockchain platform—it is a maturing ecosystem committed to transparency, security, and user-first values. From issuing a $10 million security fund to supporting a full compensation plan, Sui has responded with both urgency and vision.
As the ecosystem continues to recover and grow, the incident may ultimately serve as a turning point—one where the foundations of trust and innovation are made stronger through action.