$260M Cetus Hack: Sui Freezing Funds Sparks Decentralization Concerns
Cetus Protocol, one of Sui blockchain’s leading DEXs, just took a massive hit—$260 million drained from its liquidity pools in what’s now the biggest crypto hack of 2025 so far.
The Cetus hack exploit, which occurred on May 22, targeted a smart contract bug tied to an oracle vulnerability. Cetus quickly paused smart contracts to stop the bleeding. But what really grabbed headlines? Sui validators stepped in and froze over $160M of the hacker’s stolen funds.
That move saved 73% of the loot. But it also sparked a huge debate in the crypto world.
Sui’s intervention raised eyebrows about how “decentralized” the network actually is. Critics argue that if validators can freeze funds at will, then Sui isn’t truly decentralized. Justin Bons from Cyber Capital even slammed the chain, saying its founders hold most of the token supply and only 114 validators exist.
On the flip side, Sui defenders like Matteo, an anon ambassador from SuiLend, say the validators acted responsibly. “Decentralization doesn’t mean being powerless—it means coordinating without central permission,” he said on X.
Meanwhile, Cetus is offering a $6M bounty to the hacker to return the rest of the funds. About $60M was bridged to Ethereum, and $53M of that has already been laundered.
The hack triggered a deeper conversation: Should blockchains be able to freeze assets to protect users, or does that cross a line?
One thing’s clear—this cetus hack event could be a major turning point in how we define decentralization in crypto.
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