Cetus Recovery Plan on Sui Echoes Solana’s Strategy After $223 Million Exploit
The decentralized exchange (DEX) Cetus, based on the Sui network, is employing a recovery strategy that bears a striking resemblance to one previously used by a Solana project. This approach involves offering a bounty to the hacker in exchange for the return of stolen funds. As reported by Cointelegraph, the Cetus team is leveraging their past experience from a similar situation with Crema Finance, a Solana-based DeFi project.
The Cetus Recovery Plan
Cetus suffered a significant loss of $223 million due to an exploit on May 22. In response, they’re offering the hacker a deal: return all but $6 million (or 2,324 Ether) of the stolen funds, and Cetus will promise not to pursue legal action. This strategy mirrors a previous situation with Crema Finance, where a similar negotiation led to the recovery of a substantial portion of stolen funds.
However, the size of the bounty has drawn criticism from the community, with many advocating for a more formal compensation plan. Concerns have been raised that the damage to CETUS token holders, who saw the token’s value plummet after the hack, may be irreversible even if the funds are recovered.
Sui Validators Under Scrutiny
Sui validators have also faced criticism for their decision to freeze the hacker’s funds. While intended to aid in recovery, this move has sparked debate about the level of centralization within the Sui network. Critics argue that the validators’ actions highlight potential risks associated with centralized control.
Crema Finance Connection
The connection between Cetus and Crema Finance adds another layer to this story. The same development team is reportedly behind both projects. Crema Finance experienced a $9 million hack in 2022 and successfully recovered most of the funds through negotiation. The current recovery plan for Cetus appears to be a page out of the Crema Finance playbook.
Interestingly, the hacker involved in the Crema Finance incident was eventually caught and sentenced to prison in the US. This detail underscores the risks hackers face, even when initial deals are struck.
Centralization Concerns on Sui
The decision by Sui validators to freeze the stolen funds has ignited a debate about the network’s decentralization. With only 114 validators, Sui is seen by some as more centralized than other smart contract platforms. This action raises questions about the balance between security and censorship resistance in the crypto space. Justin Bons, founder of Cyber Capital, voiced his concerns on X, highlighting the potential for censorship due to the concentrated ownership and limited number of validators.
In Conclusion
The Cetus situation highlights the ongoing challenges and complexities within the DeFi space, particularly concerning security and decentralization. The outcome of Cetus’s recovery efforts will be closely watched by the crypto community, as it could set a precedent for how similar incidents are handled in the future. The incident also underscores the importance of thorough security audits and robust governance mechanisms in decentralized platforms. This comes just as Ethereum and Bitcoin face increased regulatory scrutiny.
Source: Cointelegraph
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