The Sui Foundation announced it has provided a secured loan to Cetus Protocol so it can fully compensate users whose funds were stolen in a recent hack. 

Cetus will use this loan alongside its own cash and token reserves. If the Sui community approves a vote to unlock frozen assets, affected users could receive full reimbursement.

Full Compensation For Victims

Cetus Protocol made the offer public on May 28 via a post on X(Twitter). The team said it is ready to cover all assets taken by hackers, using money from its treasury and a loan from the Sui Foundation.

📢 New Progress Update – A Path Forward Together!

Since the incident, we have reflected deeply on the incident and its impact on our users, partners, and the broader ecosystem. We are deeply sorry and take this responsibility seriously. Today, we want to share a meaningful step…

— Cetus🐳 (@CetusProtocol) May 27, 2025

The funds will make up for any assets that were bridged out of the Sui network before validators froze the attacker’s wallet. However, full recovery depends on the outcome of a community vote. 

Cetus asked the community to support the vote so that the locked funds can be reclaimed. If the vote passes, Cetus will begin returning funds immediately.

Also Read: Cetus Protocol Offers $6M Bounty To Hacker In Return Of $56.3M, After $223M Sui DEX Exploit

Details of the Loan and Coverage

In its statement, the Sui Foundation explained that the loan strictly covers losses from assets that left the Sui chain. The foundation noted that Cetus could not fund these losses on its own.

Sui Foundation is providing Cetus with a secured loan as part of a plan to quickly compensate user losses in full. The Cetus team will use these loan proceeds together with assets from their treasury to cover losses from the stolen funds that have been bridged out of the Sui… https://t.co/QYq14lGsl6

— Sui (@SuiNetwork) May 27, 2025

The loan is separate from any funds already frozen on-chain. Cetus will deploy its own cash and token holdings to cover any other stolen assets. This plan allows Cetus to offer 100% reimbursement to users affected by the hack, should the community approve unlocking the frozen assets.

The Hack and Immediate Response

The breach occurred after hackers found a hidden error in open-source code used by Cetus in its smart contracts. This flaw weakened security and let attackers steal about $223 million. 

Once the team and Sui network validators detected the breach, they quickly froze the attacker’s address. This action stopped further transactions from the hacker’s wallet.

Cetus said it regrets the incident and is committed to making things right. In its message, the team apologised to users, partners, and the wider ecosystem for the exposure. They stressed that user trust is their top priority and that they have learned from the event.

Next Steps and Outlook

If the community vote succeeds, Cetus will follow a detailed plan to return funds to users. The team said it will share that plan after the vote. 

Even if the vote fails, Cetus will still start recovering assets it can access. The company urged the Sui community to back the vote to restore user losses and strengthen the DeFi ecosystem on Sui.

The loan from the Sui Foundation gives Cetus a chance to make its users whole after one of the largest hacks on the network. By using this funding and its own resources, Cetus aims to repay every affected user.

Also Read: Sui-Based Protocol Haedal Halts Key Service Amid Cetus Security Breach