Is Sui Decentralized If It Can Freeze $160M? Solana’s Co-Founder Says No

Sun May 25 2025
After the $220M CETUS hack on Sui, Solana's Anatoly Yakovenko questions Sui's decentralization claims. Is freezing funds proof of control—or responsible governance?

🧨 220M Stolen. 160M Frozen. But Is Sui Still Decentralized?

After a 220M exploit rocked CETUS DEX on Sui, the real question isn’t just how it happened — it’s what happened next.

Sui validators froze 160M in stolen funds. And that single move? Lit a fire under the decentralization debate.

Solana co-founder Anatoly Yakovenko didn’t hold back: “If a minority can override the network, it’s not decentralized.”


🛠️ What Happened: The CETUS Overflow Hack

On May 22, attackers found an overflow bug in the CETUS smart contract — specifically in the add_liquidity() function.

Result?

  • 🧨 220M siphoned out
  • 💸 CETUS token down 40% in hours
  • 🔒 Sui validators froze 160M to stop the bleeding

Quick response? Yes. But also a centralized power move in the eyes of many.


🧠 Yakovenko’s Decentralization Test

Forget vibes. Anatoly wants metrics.

“If a small group can freeze or veto the majority’s will — that’s not decentralization. That’s just branding.”

His statement came after Sui’s validator set froze the hacker’s wallet via coordinated action, without an on-chain vote.


🔥 Industry Response: Firestorm

Critics say:

  • ❌ “Freezing = Fintech, not blockchain”
  • 🧱 “If you can override the code, it’s not code-is-law”
  • 🧑‍⚖️ “It’s a slippery slope to full-blown central control”

Cyber Capital’s Justin Bons called the action “purely centralized,” while user @Loonies posted:

“You froze it. You own it. You’re a fintech company.”


⚖️ Defenders Say: It Was the Right Call

But not everyone’s mad.

Amogh Gupta from the Sui Foundation claims it was distributed governance in action.

And others point out:

  • 🧠 Ethereum and Solana have also intervened in past exploits
  • 🛡 “Security and sovereignty don’t always align”
  • 🗳 “Decentralized doesn’t mean passive”

DeFi advocate Cassie put it simply:

“Freezing a hacker isn’t centralization. It’s called showing up.”


📉 Forensics? Still Weak

Adding to the tension: Sui’s on-chain visibility is limited — making it hard for researchers to trace what happened and how.

No real-time analytics = no community oversight. Which raises the decentralization red flag even higher.


🧠 TL;DR: Sui Froze the Hacker’s Funds — But Also Froze the Decentralization Narrative

  • 🧱 CETUS DEX hacked for 220M on Sui
  • 🔒 160M frozen by validator coordination
  • 🧠 Solana’s Yakovenko says: this proves Sui isn’t decentralized
  • 🧑‍⚖️ Critics say: “It’s fintech in Web3 clothing”
  • ⚖️ Defenders say: “It’s smart, not centralized”
  • 🔍 Meanwhile, Sui’s on-chain forensics are lagging

Lesson: If your blockchain can stop the code, then code isn't law — human judgment is.

And the crypto world? Still can’t agree if that’s good or dangerous.

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