Decentralized exchange Bunni has announced that it is halting its operations after suffering an $8.4 million exploit last month. This is the second crypto project to announce its cessation after blockchain firm Kadena declared bankruptcy and shut down its operations.
According to an official statement posted on X, the Bunni team mentioned that the project would halt operations due to a lack of funds. The team claimed that they had been struggling to rebuild after losing funds to hackers last month. “In order to securely relaunch we’d need to pay six to seven figures in audit and monitoring expenses alone, capital that we simply don’t have. It’d also take months of development and business development effort just to get Bunni back to where it was before the exploit, which we cannot afford. Thus, we have decided it’s best to shut down Bunni,” the team wrote.
Bunni halts operations after September hack
Bunni, a decentralized exchange based on Ethereum, suffered an exploit in September after one of its smart contracts was compromised. As reported by Cryptopolitan, its blockchain data showed that the attacker targeted stablecoin vaults holding USDT and USDC, before moving more than $2.3 million worth of assets through several decentralized finance (DeFi) protocols.
According to blockchain investigators, the hacker moved the stolen tokens by converting parts of the loot into Ethereum and other stablecoins. After detecting the breach, the Bunni team closed all active smart contracts to prevent further losses. Despite that, the hackers continued to swap funds through DeFi protocols in the hours that followed. Bunni halted withdrawals, alerting its users that the development was on hold until further notice.
The team also stated plans to distribute treasury assets to holders of BUNNI, LIT, and veBUNNI tokens based on a blockchain snapshot. “The validation of the legal process is ongoing, and the exact details of the distribution will be shared at a later date once the legal process is finalized. Team members will be excluded from the snapshot,” Bunni asserted.
Developers also announced that the Bunni v2 smart contracts have been relicensed from Business Source License (BUSL) to the more permissive MIT license. This change will allow the broader DeFi community to reuse its technologies, including Liquidity-Directed Fees (LDFs), surge fees, and autonomous rebalancing mechanisms. “We have pushed the AMM [automated market maker] space forward by a generation, and it would be a shame if our efforts went to waste,” the Bunni team stated.
Bunni also promised to continue its cooperation with law enforcement in a bid to recover the stolen assets. “Thank you to everyone who has supported us throughout our journey to push DeFi forward,” the post concluded. The decision to shut down prompted a response from security auditing and Sequoia Capital-backed firm FailSafe, which offered to assist Bunni to keep its operations going.
