The Cetus Protocol Relaunches with New Roadmap, Open-Source Plans, and Compensation Programme
The Sui network-based Cetus Protocol has made a comeback after a $223 million exploit, unveiling a new roadmap, open-source initiatives, and a compensation programme for affected users.
In a blog post on June 8, the decentralized exchange detailed its post-relaunch strategy, which includes measures to enhance protocol security, upgrade monitoring systems, and transition towards full open-sourcing. Additionally, a white hat bounty programme has been revamped to support community-driven security efforts.
Following the exploit, all affected CLMM pools have been replenished using a combination of recovered assets, treasury funds, and a $30 million loan from the Sui Foundation. Liquidity providers will regain access to their previous positions, with recovery rates varying from 85% to 99% depending on the extent of damage to each pool.
To compensate for unrecovered losses, Cetus has allocated 15% of its native CETUS token supply to affected users. Of this allocation, 5% will be immediately claimable, while the remaining 10% will be unlocked monthly over the next year, starting June 10. Importantly, the 15% CETUS allocation does not introduce new inflation, as it repurposes unvested team tokens within the existing supply cap.
Compensation claims will be tied to LP position NFTs, ensuring that users can redeem CETUS even after withdrawing liquidity. The protocol has undergone new security audits to fortify its resilience, covering all code patches, contract upgrades, and the compensation contract. Additional audits and real-time threat detection upgrades are in the pipeline to further bolster protocol security.
The exploit on May 22 prompted the Cetus team to freeze operations and collaborate with Sui validators to recover assets. A governance vote on May 29 approved the transfer of $162 million in frozen funds to a multisig wallet for recovery, with the Sui Foundation providing a USDC loan to mitigate off-chain losses.
Legal proceedings are underway in multiple jurisdictions, with law enforcement actively involved in pursuing the attacker. Despite the attacker declining a $6 million white-hat bounty, attempts to launder assets are being monitored, with most movements traceable according to the team.
If additional funds are recovered during the compensation period, users will have the option to redeem CETUS for USDC. Once the period concludes, remaining funds will be utilized for token buybacks and deposited into the community treasury.
Despite these efforts, CETUS saw a 7% decline on the day of the announcement, continuing a downward trend that began in May. The Cetus Protocol remains focused on recovery, security enhancements, and community support as it moves forward with its relaunch.