Sui validators approved a governance proposal to return $162 million in frozen assets related to the recent vulnerability incident at the decentralized exchange Cetus, marking a key step towards full reimbursement for users.

Cetus suffered a vulnerability attack on May 22, resulting in the loss of over $220 million in digital assets, but validators successfully froze $162 million in funds shortly after the incident occurred.

According to the official governance page of the network, in the governance vote that ended on May 29, Sui validators passed the recovery proposal with 90.9% in favor, 1.5% abstaining, and 7.2% not participating.

"Based on this result, the affected funds will be transferred to a multi-signature wallet for custody until they can be returned to users according to the plan led by Cetus," Sui stated in a post on the X platform on May 29.

This decision was made after a debate in the crypto community regarding the role of validators in freezing on-chain funds.

While some decentralized advocates criticized the ability of validators to freeze funds, other industry observers praised this quick response as a step forward in combating the increasing vulnerability attacks in the crypto industry.

The community vote is part of a broader recovery plan that includes utilizing Cetus's fund pool and emergency loans from the Sui Foundation.

Cetus expressed gratitude for the community's swift support and shared its recovery roadmap after the vote concluded.

First, Sui validators will implement an upgrade to transfer the frozen funds to the Cetus multi-signature wallet, after which Cetus can initiate the upgrade of its emergency recovery pool and complete data recovery.

"Cetus aims to complete full recovery and restart in about a week," the protocol wrote in a post on the X platform on May 29, adding:

"A dedicated compensation contract is being developed and will undergo auditor review before deployment."

After the protocol fully restarts, all liquidity providers in the affected pool will regain access to their recovered liquidity, while remaining losses will be "claimable through the compensation contract," the protocol added.

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Original: “Sui community votes to reimburse $162 million to Cetus vulnerability victims”

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