Cetus mounts full-scale recovery after $162M attack

The Cetus protocol, a Sui-based decentralized exchange (DEX), suffered an exploit of its Concentrated Liquidity Market Maker (CLMM) pools on 22nd May 2025. That left it scrambling to prevent the loss of $223 million of its investors’ funds.

Unfortunately, the team’s best efforts couldn’t stop the attacker from making away with $60M of those funds. Consequently, the DEX paused its operations momentarily to audit the incident, 

Fast forward to 6th June, and the firm teased about relaunching its activities two days later, boldly proclaiming, “This isn’t just about recovery or bouncing back — it’s about resilience, rebuilding, and an unwavering long-term commitment to the entire Sui ecosystem. “

This announcement tore the Cetus community right through the middle, indicating that it would take plenty of effort and goodwill from all the parties to stitch it together. While the decision to relaunch its CLMM pools service is commendable, the DEX has a long way to go in regaining its users’ trust 

Cetus mounts full-scale recovery after $162M attack

Throughout the May 22nd debacle, the Cetus team pulled all stops to contain the situation. Together with its Sui blockchain counterparts, it managed to pause the transfer of $162M of the stolen funds. It then initiated moves to protect itself from further attacks, including identifying and patching the vulnerability that exposed it to hackers. 

It also rallied its community to work with Sui validators to free the assets they had quarantined after the attack. At the same time, it secured a $30M line of credit from the latter’s foundation to boost its recovery. Next, it resets all the affected pool data to its original settings while aligning it with prevailing market conditions. 

Additionally, it rebalanced its assets in preparation for pool refills and drew up a compensation contract for the affected. These efforts and many pledges of future enhancements did little to erase the mistrust some held on the DEX’s restart.

Investors continue to express misgivings about Cetus’s relaunch

Even as Cetus embarks on the audacious relaunch, it can’t play deaf to the concerns part of its community holds regarding the exercise. One such fear is that the token may turn inflationary, as some of its members suggested. 

Lady Cardano, for instance, was skeptical about the relaunch, suggesting that the DEX would inject 76 million new $CETUS tokens (a 5% supply increase) into circulation. The member concluded that the recipients could sell their allocations, potentially reducing the token’s value. 

Many members also complained that they’d lost significant portions of their investments. For example, Nikolai (@Nikolai7035) decried losing 30% of his position and swore never to return to that dump (Cetus again). His counterpart Stas (@staasbtc) reiterated this point, asking the protocol if it was using them to cover for the 30% of the liquidity lost in the hacking. 

It didn’t help that others could not access liquidity pools or remove their funds. If true, this latest failure indicates that technical or organizational hurdles continue to plague trust in the weapon system’s performance.

As resentment over Cetus’s slow recovery of full service mounted, some investors like Wesley_ (Redwhite2626) began to call the project a scam. Reservations of such a kind reveal a lack of trust and resentment toward the team and their project.

How can Cetus regain its users’s trust? 

If Cetus had imagined having a smooth restart after the hack, then it had another thing coming. That’s because winning over a community plagued with discontentment and mistrust is exacting. It will require more than PR stunts to pacify people who strongly feel the exchange let them down by failing to provide their investments with the protections they trusted it with. 

So, with time, tact, and sustained effort the protocol may still cultivate its community’s trust to the pre-hack day levels. However, it must be forthright with its users to achieve that feat. That entails coming clean on the claims that its issuance of 70M+ $CETUS tokens will erode the crypto asset’s value. It should enlighten its users on why making such a huge allocation was necessary and commit to buybacks and token burns to prop up the asset’s value. 

Secondly, the team should move fast to quell its users’ other concerns: they might have lost some of their funds forever. That calls for a full and timely restoration of the protocol to its pre-hack state, including a full restitution of investor positions and liquidity pools. This move will bolster users’ confidence in the project’s recovery efforts/sustainability. 

Again, the DEX should double down on allaying its investors’ qualms about its long-term security. Some quarters have questioned the robustness of its systems’ overhaul, given the pace of its relaunch. In this instance, a public and detailed update of the process will go a long way in easing those uncertainties. Add to the platform’s improved operability post-restart, and it’ll inspire more confidence in its offerings. 

Cetus’s resurgence is about more than just recovering lost funds or lost market share; it is about demonstrating that DeFi can move past its pain points. If it can use the disaster of recent weeks as a spark for reform, it may actually end up stronger, providing, over time, a more secure and stable foundation for the future.

Yet, for that to occur, it will need to move beyond this moment of crisis and make security, transparency, and user trust paramount above all else. The DeFi community is watching and waiting for now but knows the next chapter is up to them to write.

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Original reporting: cryptopolitan.com