The SUI blockchain ecosystem suffered a devastating blow when its flagship decentralized exchange, Cetus Protocol, fell victim to a sophisticated $260 million hack that sent shockwaves throughout the crypto community.
The massive security breach triggered an immediate market reaction, with SUI’s native token plummeting approximately 15% to trade around $3.81 as investors rushed to exit positions amid growing concerns about the platform’s security infrastructure.
Blockchain analytics firm Lookonchain identified the perpetrator as operating through wallet address “0xe28b50,” revealing the sophisticated nature of the attack.
Cetus(@CetusProtocol) on #SUI was hacked and lost more than $260M!
The hacker is converting the stolen funds into $USDC and cross-chaining to #Ethereum to exchange for $ETH, with ~60M $USDC already cross-chained.https://t.co/b0uGu8icXrhttps://t.co/0BpKSaygmr pic.twitter.com/txfxLoImOd
— Lookonchain (@lookonchain) May 22, 2025
Clever Strategy
The hacker employed a clever manipulation strategy, introducing fake tokens including one labeled “BULLA” to deceive the protocol’s smart contracts. By exploiting vulnerabilities in the liquidity pool mechanisms, the attacker successfully drained legitimate assets from the exchange’s reserves.
The stolen funds consisted of approximately 12.9 million SUI tokens valued at $54 million, along with $60 million worth of USDC stablecoin. This dual-asset theft demonstrates the hacker’s strategic approach to maximizing the value extracted from the compromised system while targeting both the platform’s native token and widely-accepted stablecoins.
Rapid Response And Support
Following the discovery of the security breach at 3:52 AM Pacific Time, Cetus Protocol’s development team immediately implemented emergency measures to contain the damage. The team suspended all smart contract operations to prevent additional fund drainage and launched a comprehensive investigation to identify the attack vector and assess the full scope of the compromise.
The hacker wasted no time in attempting to obscure the stolen funds’ trail, converting the majority of the pilfered USDC into Ethereum. On-chain data reveals that $58.3 million USDC was used to purchase 21,938 ETH at an average price of $2,658 per token, suggesting a calculated effort to launder the proceeds through cryptocurrency exchanges and mixing services.
The market impact extended beyond the immediate price decline, with trading volumes surging as investors processed the implications of such a significant breach on a major blockchain platform. SUI had briefly experienced positive momentum following OKX’s launch of xBTC, gaining nearly 5% over 24 hours before the hack news triggered the sharp reversal.
Recovery efforts remain ongoing as the Cetus team works around the clock to identify the root cause of the vulnerability and explore options for fund recovery. The incident highlights the persistent security challenges facing decentralized finance platforms and underscores the importance of robust smart contract auditing and security protocols in protecting user assets.
With most altcoins on a tear so far this week, the crypto community now watches closely as investigators work to trace the stolen funds and determine whether or not any immediate recovery mechanisms might be available to affected users.
