The decentralized exchange cites lack of funds for audits and recovery efforts, while open-sourcing its code earns praise from developers.
Decentralized exchange (DEX) Bunni has announced that it will cease operations following a devastating $8.4 million exploit in September. The shutdown makes Bunni the second major crypto project to fold this week, following the closure of the Kadena blockchain founding team amid worsening market conditions.
Bunni DEX Forced to Shut Down After Exploit
In an official post on X (formerly Twitter), the Bunni team confirmed that it would wind down operations due to an inability to fund crucial audits and relaunch costs.
The exploit on Sept. 2 drained $8.4 million from the protocol across Ethereum and the Unichain layer-2 network, halting all activity. A subsequent investigation revealed vulnerabilities in the protocol’s codebase, prompting Bunni to suspend operations indefinitely.
Before the attack, Bunni had been one of the fastest-growing DEXs, with its total value locked (TVL) soaring from $2.23 million in June to nearly $80 million by mid-August, according to DefiLlama.
Open-Sourcing Bunni v2 Code Draws Community Praise
Despite shutting down, the team made a decision that has been widely applauded by the developer community: relicensing its v2 smart contracts from the Business Source License to the MIT open-source license.
This move allows developers to freely use and expand upon Bunni’s core innovations, including its Liquidity Distribution Function, surge fees, and autonomous rebalancing mechanisms.
The team stated that users will be able to withdraw their assets through the official website until further notice. Additionally, remaining treasury funds will be distributed among BUNNI, LIT, and veBUNNI tokenholders once legal clearance is obtained. Team members themselves will not receive any portion of the remaining assets.
Bunni also confirmed that it continues to cooperate with law enforcement agencies to recover the stolen $8.4 million.
Just days before Bunni’s announcement, the founding team behind layer-1 blockchain Kadena also declared that it would cease operations due to difficult market conditions. While the Kadena network will remain community-driven, its native token (KDA) has plummeted by 70% since the announcement and now trades around $0.06, according to CoinGecko.
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