The attacker exploited Cetus using fake tokens to distort reserve data and drain real SUI and USDC assets from liquidity pools.
Around $162 million in stolen funds have been frozen while the remaining assets are being tracked across multiple blockchains.
The SUI token fell sharply by nearly 15 percent following the breach, reversing its earlier weekly high momentum.
Cetus Protocol, the leading decentralized exchange and liquidity platform on the SUI blockchain, has fallen victim to a major exploit totaling $260 million. On-chain data confirmed that the attacker used a wallet labeled “0xe28b50” to carry out the operation.
Initial investigations revealed that the exploiter converted stolen SUI tokens into USDC. The funds were then bridged to the Ethereum blockchain and swapped for ETH. Blockchain tracker Lookonchain reported that the wallet currently holds more than 12.9 million SUI, valued at approximately $54 million.
Fake Tokens Used to Manipulate Internal Reserves
Preliminary findings suggest that the attacker leveraged fake tokens such as BULLA to manipulate liquidity pool pricing. By exploiting internal calculations, the attacker added small amounts of liquidity to distort reserve balances and drain significant amounts of SUI and USDC.
https://twitter.com/lookonchain/status/1925520316044046809
Following the exploit, the Cetus development team paused all smart contracts. The team is actively investigating and coordinating with the Sui Foundation and key ecosystem players. Approximately $162 million worth of stolen funds have been frozen to prevent further outflows.
SUI Token Drops as Market Reacts to Exploit
The SUI token experienced immediate market pressure after news of the hack surfaced. It dropped nearly 15 percent within hours and is currently trading at $3.65. While the token had earlier surged due to OKX’s xBTC announcement, the breach quickly reversed gains.
Besides SUI, several other tokens within the Cetus ecosystem witnessed steep declines. Tokens, including LBTC and AXOL, lost nearly their entire value. Others, like LOFI, HIPPO, and SQUIRT, declined by over 80 percent in under six hours.
Binance founder Changpeng Zhao responded to the incident on X, expressing support for the SUI ecosystem. He assured users that efforts are underway to assist affected stakeholders and secure the network.
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