On May 22, 2025, Cetus, the largest decentralized exchange (DEX) and liquidity provider on the Sui blockchain, was hacked. The attacker stole over $260 million in assets. While most funds were recovered, the incident shook confidence in Sui’s growing DeFi ecosystem.
What Went Wrong?
The hacker found a bug in Cetus’s Concentrated Liquidity Market Maker (CLMM) code. A key flaw in the tick account system—used to manage liquidity positions—allowed for an arithmetic overflow. This mistake let the attacker withdraw far more than they deposited.
Using just a small amount of funds, the hacker launched a flash swap of 10 billion fake tokens (haSUI). They then opened a wide liquidity range with barely any real liquidity. When they pulled out their position, the overflow bug gave them a huge payout.
Token Chaos and Market Impact
The exploit led to chaos across the Sui network. The attacker used fake tokens to manipulate price feeds and drain more assets. Key losses included:
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12.9M SUI (~$54M)
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$60M USDC
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$4.9M in staked SUI
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$19.5M TOILET token
Other tokens like HIPPO and LOFI crashed by up to 80%, wiping out user funds.
Quick Response: $162M Frozen
After the attack, the hacker tried to launder USDC through Ethereum and mixers like Tornado Cash. But Sui validators acted fast, freezing around $162 million of the stolen assets.
The Cetus team worked with the Sui Foundation and security firm Hacken to patch the code and bring the platform back online. An investigation is still ongoing.
Why This Matters for Crypto Users
This was the largest DeFi hack on Sui to date. It raises serious questions about smart contract audits and the security of new blockchains. While recovery efforts were strong, the damage to user trust may take time to heal.
As crypto enters a bull market, users should be cautious. Platforms like Cetus may offer high returns, but they also carry risks. Always research DeFi protocols before investing.
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