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Volo Protocol Loses $3.5 Million in Sui Vault Exploit Amid DeFi Hack Streak

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Volo Protocol Loses $3.5 Million in Sui Vault Exploit Amid DeFi Hack Streak

Sui-based liquid staking platform Volo Protocol said on Wednesday that an attacker drained roughly $3.5 million from three of its vaults, the latest DeFi security breach in a month already shaken by nine-figure exploits.

Volo froze every vault after detecting the attack and notified the Sui Foundation. The stolen assets included Wrapped Bitcoin (WBTC), gold-backed XAUm, and USD Coin (USDC). The team said the remaining $28 million in total value locked across other vaults carries no shared attack vector.

Inside the Volo Protocol Exploit

Volo described the breach as a security incident in a statement posted on X early Wednesday. Only three vaults were affected, and the team said no other part of the protocol shares the same vulnerability.

The project is working with on-chain investigators and ecosystem partners to trace and recover the stolen funds. A full post-mortem will follow once the internal review concludes.

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Volo originally launched as a dedicated SUI liquid staking platform, issuing the Volo Staked SUI (vSUI) token, before being acquired by Sui lending protocol NAVI in early 2024. The vault products targeted in this incident sit on top of that staking layer and accept wrapped assets and stablecoins as collateral for yield strategies.

Volo also moved to reassure users that any losses would not be passed on.

“Volo is prepared to absorb this loss. We will do our best not to pass this to our users,” Volo team, said.

The protocol said a remediation plan would follow once damage control operations finish, adding that rebuilding user trust depends on actions rather than promises.

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Latest Hit in a Brutal Month for DeFi

Volo’s loss follows a string of major April incidents that have battered decentralized finance. Solana-based Drift Protocol lost about $285 million on April 1, in what Elliptic has linked to a suspected North Korean infiltration operation.

Less than three weeks later, restaking protocol Kelp DAO was drained of 116,500 restaked ether (rsETH) worth roughly $292 million through a compromised LayerZero bridge. Ethereum DeFi has since lost more than 17% of its total value locked.

Balancer also lost more than $128 million to an exploit earlier in the year. A targeted wallet drain cost one individual investor over $280 million across Ethereum and Arbitrum.

The Sui ecosystem has faced similar crises before. Attackers exploited the Cetus exchange for about 223 million dollars in May 2025. A flaw in concentrated liquidity pools enabled the attack. Sui validators and the community recovered most stolen funds. Total value locked on Sui exceeded 2.6 billion dollars in late 2025. This growth expanded the attack surface for exploiters. Attackers now target vault logic and oracle dependencies more often.

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Volo promises to cover the 3.5 million dollar loss without external help. Depositors will watch closely when withdrawals reopen. The post-mortem should clarify the root cause. It will show whether the flaw was isolated or systemic. The findings may impact trust in the Sui DeFi ecosystem.

The post Volo Protocol Loses $3.5 Million in Sui Vault Exploit Amid DeFi Hack Streak appeared first on BeInCrypto.

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Crypto World

Uzbekistan Launches Crypto Mining Zone in Karakalpakstan

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Uzbekistan Launches Crypto Mining Zone in Karakalpakstan

Uzbekistan has created a special crypto mining zone across Karakalpakstan under a presidential resolution signed on April 17, opening a supervised framework that lets approved mining companies sell mined digital assets on foreign platforms while keeping the proceeds inside the country’s banking system.

A presidential decree effective April 20 creates the “Besqala Mining Valley,” a special mining zone across the Republic of Karakalpakstan, where registered legal entities can carry out crypto mining, use a mix of power sources and apply for resident status through a new directorate under the republic’s Council of Ministers.

The framework gives miners in the zone the right to sell crypto assets obtained through mining on national crypto exchanges or foreign platforms, including through direct contracts, and to exchange them for other liquid crypto assets. Still, the opening comes with strict controls over how mining revenues move through the financial system, and proceeds from those sales must be transferred to bank accounts in Uzbekistan.

Tax breaks aim to lure miners

The decree also provides for a tax exemption through Jan. 1, 2035, while requiring them to pay a monthly fee equal to 1% of income from mining activity to the zone’s directorate. The resolution separately instructs officials to submit draft amendments to Uzbekistan’s tax code within two months.

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The new decree adds to Uzbekistan’s recent use of special-zone incentives in Karakalpakstan to attract investment into a region that a 2025 United Nations Development Programme report described as having high poverty rates and limited industrial development.

The new framework also adjusts Uzbekistan’s earlier approach to crypto mining. In 2023, Uzbekistan’s National Agency for Perspective Projects (NAPP) issued a decree on licensing crypto mining operations, requiring firms to only use solar power to mine digital assets. 

The new decree allows a wider mix of power sources within the zone, including renewable, hydrogen and grid electricity, with higher tariffs applied for grid usage.

Related: Uzbekistan increases fees for crypto operations

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Uzbekistan expands special-zone strategy to draw investment

The move also fits a broader investment strategy in Karakalpakstan. According to a Reuters report in November 2025, the government had established a separate tax-free zone for artificial intelligence and data center projects, offering discounted electricity and tax exemptions to draw foreign investors. 

Under the initiative, foreign firms investing $100 million or more get full tax and duty exemptions until 2040. According to the report, Uzbekistan expects to attract over $1 billion in foreign investment by 2030 from the AI special zone project. 

Related: Uzbekistan greenlights stablecoins for payments under new sandbox regime

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