The Sui community has taken a significant step towards recovering user funds lost in a $223 million exploit involving Cetus. A seven-day onchain vote was initiated on May 27 to authorize a critical transaction that could enable the full recovery of the funds. If passed, the vote will allow for the transfer of compromised tokens to a newly established multi-signature wallet controlled by multiple ecosystem stakeholders.
As of the latest update, the proposal is well on its way to approval. Out of 56 validators who have cast their votes, 54 voted in favor and only 2 voted against, showing strong support for the recovery plan. With both majority and participation thresholds already met, the outcome is unlikely to change unless a significant portion of the remaining validators vote against it before the deadline on June 3.
Notably, the vote could conclude early if the uncast stake is unable to affect the final result. This scenario may lead to early passage as soon as one day from now. The Sui Foundation has emphasized that the affected assets were frozen immediately after the breach and have remained untouched. The current vote represents the only community-backed mechanism to return the funds and restore user balances.
Cetus Protocol, a decentralized exchange on the Sui blockchain, was the target of the exploit, losing over $200 million in digital assets. The team initially downplayed the incident as a “bug,” but later acknowledged the severity of the situation. Cetus has offered a bounty to the hackers and has pledged full reimbursement to users, dependent on the outcome of the community vote.
According to Cetus, the necessary capital, including token reserves, fiat liquidity, and a loan facility from the Sui Foundation, has been secured to cover all stolen assets. The team has expressed deep regret for the incident and is committed to restoring user trust. Recovery efforts will begin immediately after the vote ends, with full user repayment contingent on access to the frozen assets.
The proposed recovery structure includes the creation of a secure multi-signature wallet to hold and disburse the recovered funds. Governed by six independent signers, including Cetus representatives and ecosystem stakeholders, the wallet will require approval from at least four signers for any transaction. Before funds are disbursed, a detailed user repayment list will be reviewed by OtterSec, a blockchain security firm tasked with verifying all claims.
The Sui Foundation has released code for an onchain community vote, allowing validators to cast their votes and Sui holders to vote directly through stake delegation. The Foundation will not vote on the proposal to preserve decentralization but reserves the right to act as a backup signer in the multi-sig if needed.
Overall, the Sui community is making significant progress in the recovery efforts following the exploit, demonstrating a commitment to restoring user funds and confidence in the ecosystem.