The Sui blockchain is facing backlash from the crypto community following a controversial move by its validators. After a major exploit on Cetus Protocol, the largest DEX on the Sui network, validators acted quickly to freeze millions in stolen funds — but this response has triggered a heated debate about Sui’s decentralization.
SUI is down 5% in 24 hours
While the Sui community remains divided over the proposed network upgrade to recover frozen assets, the SUI token continues to feel the pressure. It is currently trading at $3.63, down 6.57% in the past 24 hours, amid a broader market correction triggered by Bitcoin’s recent surge to a new all-time high of $112,000. Adding to the token’s woes, the Cetus Protocol exploit caused a sharp drop, with SUI falling over 13% from $4.19 to $3.62 immediately after the incident. Meanwhile, CETUS, the protocol’s native token, has not recovered either—down 5% today and plunging more than 17% over the past week, currently hovering around $0.1640.
$223M Hack Shakes Cetus Protocol
On May 22, 2025, a smart contract vulnerability allowed attackers to siphon off $223 million from Cetus Protocol. The breach became one of the largest on the Sui blockchain to date.
Validators stepped in to freeze around $162 million in funds, blocking transactions from addresses linked to the exploit.
While this quick action likely prevented further losses, it raised serious questions about the power of validators in the supposedly decentralized network.
Community Questions Decentralization
“If validators can freeze funds at will, is this really decentralized?” asked one Sui token holder on social media.
The community is divided. Some applaud the action as a necessary safeguard, while others criticize it as a centralized overreach that contradicts the core values of decentralized finance (DeFi).
“Decentralization means no single party should control or stop transactions,” said DeFi researcher Mia Thompson. “This event undermines trust in that principle.”
Governance Vote Proposed
In response to the backlash, Cetus Protocol has proposed a governance vote involving SUI stakers and validators to decide what to do with the frozen funds.
The Sui Foundation confirmed it will facilitate the vote but will not participate, maintaining a neutral stance.
Cetus has promised to fully return all recovered funds to affected users, emphasizing transparency in the recovery process.
SUI Price Drops Then Rebounds
The controversy hit SUI’s market value. The token fell to $1.13, reflecting a 12% drop following news of the exploit and fund freeze. However, within hours, it rebounded by 15%, stabilizing around $1.30, showing some investor confidence in Sui’s damage control.
As of now, SUI is trading at $3.65, still down 5.7% from the previous close.
Conclusion: A Crucial Moment for Sui
The Cetus exploit and the validator response have thrown the spotlight on a critical issue: Can a blockchain still be called decentralized if insiders can freeze assets?
The outcome of the community vote will determine not just the fate of the frozen funds, but the future credibility of the Sui network.