On May 22, 2025, the blockchain community witnessed a shocking incident. Cetus Protocol, a distributed finance (DEFI) platform built on a SUI network, was hacked and lost $260 million.
The event caused serious economic damage and sparked a fierce debate on decentralization, a core principle of blockchain technology.
Is SUI networks really decentralized?
Immediately after the hack, Cetus immediately suspended the smart contract, preventing further losses. In its latest announcement, the project said it provided hackers with a white hat deal to collect stolen funds.
The intention behind the contract suspension may have been good, but many experts argue that this action is inconsistent with the spirit of decentralization, the core values of blockchain. Legion founder Jesus Martinez argued that this was clear evidence that SUI is not truly decentralized.
“Decentralization is a lie. They’re blocking the $200 million “hack” transaction that took place in SUI. The masks are off,” said Jesus Martinez.
His statement quickly attracted the attention of the community and sparked widespread agreement. YCC founder Duo Nine admitted that Cetus and Sui may have made the right decision. However, he argued that decentralization is merely a marketing term for most projects, with the exception of Bitcoin and Ethereum.
“In this case, this is a good thing, but this shows that SUI networks can freeze funds on demand. Decentralization is marketing other than BTC/ETH,” Duonine said.
Furthermore, doubts about the decentralization of SUIs are not new. In May 2024, Cybercapital founder and CIO Justin Bonds publicly filed accusations of SUI. He claimed that the founder controls 84% of the tokens he stained. He argued that if a small group controls most of the tokens, founders can undermine decentralization, and founders can freely manipulate the system.
The SUI network responded, claiming that its founder had no control over tokens assigned to the Ministry of Finance or investors, but these questions persisted. After Cetus Hack, concerns resurfaced with new intensity.
“SUI validators are currently conspired to censor the hacker TXS! Is SUI centralized? The short answer is yes. Why the key is that the ‘founders’ own most of the supply, and only 114 ballots,” Justin Bonds said.
These sharp responses indicate the sensitivity of blockchain users to any indication of centralized control.
Infinite Discussion: Systems without Control and Permission
Cetus is not the first case that causes such a controversy. In fact, the DAO hack at Ethereum in 2016 encouraged hard forks and recreated the Ethereum Classic. Solana also needs silent consensus from Validators to fix the unlimited token issuance bug.
The Bitcoin Network has also discovered a significant inflation bug. At the time, Bitcoin core developers had to quietly contact the mining pool to patch the vulnerability before they could be made public. Moreover, Tether has frozen billions of dollars to support law enforcement efforts.
More recently, Thorchain faced criticism that it was used by criminals to wash stolen funds from Bybit and Coinbase.
“Cryptocurrency is a lie. We were promised pure decentralization, unstoppable code, and unreliable systems.
If a project like Thorchain chooses not to intervene, it faces legal and ethical criticism. If it decides to intervene and prevent damage, it is accused of centralization. Both seem to have a valid argument.
“The crypto world is split.” If we can freeze funds, is it really decentralized? ” vs. “They saved $162 million from being stolen forever.” Both sides have valid points, but here’s what’s important. This changes everything about L1 security assumptions.”
Decentralization was once a core ideal and is being tested by the harsh reality of security threats. Can projects like SUI balance security and decentralization? Or have you witnessed the decline of decentralisation ideals?
The issue of decentralization remains unanswered. But one thing is clear. The event deeply shakes trust in decentralization.
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