Decentralized exchange Bunni has officially announced that it will shut down operations following an $8.4 million exploit in early September, becoming the second crypto project to fold this week amid a wave of setbacks across the decentralized finance (DeFi) sector.
Key Takeaways:
- Bunni DEX is shutting down after a $8.4 million exploit drained funds across Ethereum and Unichain.
- The team cited a lack of capital to cover relaunch and security costs, halting all future development.
- Bunni’s v2 smart contracts have been open-sourced under the MIT License, allowing developers to reuse its technology in new DeFi projects.
In an X post on Thursday, the Bunni team said it could not continue operating due to a shortage of funds needed to rebuild and secure the platform.
“The recent exploit has forced Bunni’s growth to a halt, and in order to securely relaunch we’d need to pay 6-7 figures in audit & monitoring expenses alone – requiring capital that we simply don’t have,” the team wrote.
Bunni Exploit Drains $8.4M Across Ethereum and Unichain
The exploit, which took place on September 2, drained $8.4 million across Ethereum and layer-2 network Unichain, prompting an immediate halt to operations.
A subsequent blog post on September 4 confirmed that attackers had taken advantage of vulnerabilities within the protocol’s codebase.
Built on Uniswap v4, Bunni aimed to optimize returns for liquidity providers through a custom system known as the Liquidity Distribution Function.
Before the exploit, the protocol had seen explosive growth. Its total value locked (TVL) jumped from $2.23 million in June to nearly $80 million by mid-August, according to DeFiLlama.
While Bunni will no longer operate, the team has open-sourced its Bunni v2 smart contracts, relicensing them from Business Source License (BSL) to the MIT License.
The move allows developers to freely integrate Bunni’s innovations, including liquidity distribution functions, surge fees, and autonomous rebalancing, into new DeFi projects.
The decision drew praise from parts of the community for preserving the project’s technical contributions.
Users will still be able to withdraw assets through the Bunni website until further notice, and remaining treasury assets will be distributed to BUNNI, LIT, and veBUNNI tokenholders once legal approvals are secured.
Team members will not receive any portion of these funds. The team added that it continues to cooperate with law enforcement to recover the stolen funds.
Kadena Announces Shutdown Amid “Difficult Market Conditions”
Bunni’s closure follows the recent shutdown of Kadena’s founding team, which also cited “difficult market conditions.”
Despite the exit, Kadena’s network remains operational, though its native token KDA has dropped over 70% since the announcement, currently trading near $0.06, per CoinGecko.
Kadena’s mainnet went live in January 2020, promising to combine Bitcoin-style security with high throughput through an architecture known as “braided chains.”
At its peak in 2021, Kadena’s token reached a market capitalization of nearly $4 billion, supported by a growing community and a $100 million grant program for Web3 developers. But the network struggled to attract sustained adoption.
According to data from DeFiLlama, Kadena’s total value locked in DeFi has plunged to just $128,000, down 71% in 24 hours and a far cry from its all-time high of $11 million in August 2022.
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