Sui’s Validator Community Takes Swift Action to Freeze $162 Million in Stolen Funds, Sparking New Discussions on “On-Chain Governance” and “Funds Recovery” Mechanisms
Sui Validators Exercise Autonomy to Quickly Lock Down Attack Addresses
The Sui Foundation stated that the validator nodes of the Sui blockchain possess an important configuration authority: they can specify to ignore transactions from certain addresses. This feature was originally designed to allow nodes to autonomously choose whether to process transactions from certain addresses based on their risk tolerance or legal compliance needs.
In this incident, more than one-third of Sui validators (calculated by stake proportion) jointly decided to ignore transactions from two addresses suspected to be related to the attack, successfully “freezing” the crypto assets that the attackers had yet to transfer.
Not a Unique Feature, Sui Foundation: Rapid Response
In fact, the ability to “ignore transactions from specific addresses” is not unique to Sui; theoretically, validators on any blockchain network possess similar capabilities. However, in this attack incident, the Sui Foundation noted that the Sui validator community responded swiftly, successfully freezing approximately $162 million in funds before the hacker could transfer the assets across chains.
While this emergency measure cannot recover all the funds, it has created negotiation space for the victims. Unfortunately, as of now, the attackers have not responded to the Cetus team’s outreach.
Freezing Not the Final Solution, Cetus Proposes Community Vote
Following the freezing action, the Cetus team called for the community to vote on a special proposal: to return the frozen funds to users through a protocol upgrade, without rewriting on-chain history or rolling back transactions.
This proposal has received initial support from the Sui Foundation but comes with two key conditions:
1. Maintain Neutrality and Transparency: The Sui officials will not participate in the vote itself but will focus on designing and executing a governance process that reflects the community’s will, committing to publicly disclose the relevant designs and code.
2. Cetus Commits to Full Compensation: Cetus must publicly commit to deploying all its financial resources to ensure that every affected user can ultimately retrieve their funds.
Risk Warning
Investing in cryptocurrency carries a high level of risk, and its prices can be extremely volatile; you may lose your entire principal. Please assess the risks carefully.