Cetus Relaunches After $200 Million May Hack

Cetus Protocol, a Sui-native decentralized exchange that suffered a huge $220 million exploit in May, says it is now working on going open-source following its recent relaunch. 

An attacker exploited a pricing mechanism flaw to drain tokens from Cetus’ major liquidity pools on May 22. The protocol managed to freeze $162 million of the stolen funds shortly after. 

Trade volume on Cetus had been trending upward before the attack, registering over $5 billion in April and another $5 billion in May, despite shutting down after May 22. 

Cetus liquidity pools replenished with loan and reserves 

In a June 7 Medium post, a day before its relaunch, the Cetus team said it’s moving toward being fully open-sourced, with a new white bounty program, to “encourage collective technical and security contributions.”

As part of the relaunch, the team says it “worked around the clock” and patched the software vulnerability, which allowed the hack, restored pool data to the correct pricing and conducted security audits on all code fixes and contract upgrades.

Affected liquidity pools were replenished using a combination of $7 million in cash reserves, a $30 million USDC (USDC) loan from the Sui Foundation and some of the recovered assets from the attacker.

However, not all affected pools were fully restored, with the current recovery rate between 85% and 99%, depending on how much pool was drained during the attack, according to the Cetus team.

Cetus sets aside tokens for compensation plan 

As part of a compensation plan for affected users, 15% of the protocol’s native token supply, CETUS, is being set aside, with 5% available immediately and 10% linearly unlocked every month over the next year, starting June 10.

The Cetus token is down over 12% in the last 24 hours, trading at $0.11, according to CoinGecko.

There are also plans to upgrade the protocol monitoring system and have additional rounds of security audits.

Protocol is still chasing funds 

Cetus said legal action is still on the cards, with legal proceedings launched in “multiple jurisdictions” and law enforcement agencies “actively involved” as well.

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“The attacker ignored our previous white hat offer and has begun attempting to launder assets — a futile and traceable act. We are highly confident that successful arrest and recovering the remaining assets is only a matter of time,” the team said.

The day after the hack, Cetus offered a white hat bounty of up to $6 million to the exploiter if they returned the stolen 20,920 Ether (ETH), worth over $55 million, along with the $162 million in stolen funds frozen on the Sui blockchain.

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