SUI Struggles to Bounce Back After $223M Cetus Hack: Trading at $3.62

Devastating Hack Casts Shadow Over SUI Ecosystem

SUI is currently trading at a shaky $3.62, down 1% in the last 24 hours, as it battles to recover from the massive $223 million Cetus Protocol hack that rocked the crypto world on May 22. This attack, one of the biggest DeFi heists of the year, has thrown a major wrench in Sui's ecosystem, sparking fears about the network's decentralization and slamming the brakes on its bullish momentum. Before the attack, SUI was on a tear, soaring over 60% in a month and hitting a high of around $4.29 on May 12.

Rally Cut Short by Exploit

Sui's meteoric rise was fueled by the buzz around real-world asset tokenization and fresh institutional partnerships. But the rug was pulled out from under it when the attack triggered a brutal sell-off, sending SUI plummeting nearly 14% in a single day. Now, it's down almost 20% from its pre-hack levels, stuck in a tight range between $3.48 and $3.62.

Cetus Hack Exploits Smart Contract Vulnerabilities

The exploit targeted weaknesses in Cetus's smart contracts, using fake tokens like BULLA and MOJO to game price feeds and drain liquidity pools. The SUI/USDC pool alone lost about $11 million. Trading ground to a halt, and the total value locked on the Sui chain tanked from $2.13 billion to $1.92 billion.

Aftermath: Token Crash, Peg Loss, and Frozen Assets

Cetus protocol's native token crashed 40%, and the liquidity drain caused USD Coin (USDC) to briefly lose its dollar peg. In a bold move, Sui validators froze $162 million of the stolen assets by blacklisting the attacker's wallet, preventing most of the loot from escaping the network. But this raised eyebrows about the true power of validators. Critics argue that freezing transactions on demand flies in the face of decentralization, and some suspect that a small group of validators and insiders might be calling the shots, with very few users actually participating in governance.

Market Reactions and Technical Indicators

On the market front, derivatives volume has spiked nearly 40% to $3.57 billion in the last day, hinting at increased short-term interest from volatility traders. However, open interest has dipped 2.9% to $1.77 billion, suggesting that some traders might be pulling back or cashing in profits.

The technical indicators are sending mixed signals. The relative strength index is sitting at a neutral 50. Short-term momentum indicators are flashing green, hinting at a possible upside, but the moving average convergence divergence is showing a bearish crossover. Short-term moving averages are pointing down, while longer-term indicators are more bullish.

Long-Term Outlook: Can SUI Recover?

The 50-, 100-, and 200-day moving averages are all giving buy signals, suggesting that if SUI can weather the storm caused by the hack, it might still be on an upward trajectory in the long run. But for now, SUI is stuck below the $4 resistance level. Traders are watching like hawks to see if it can break through or if the fallout from the Cetus hack will keep dragging it down.