Decentralized exchange Bunni has announced it is shutting down following an $8.4 million exploit in September, becoming the second crypto project to cease operations this week. The team revealed in a Thursday post on X that financial constraints stemming from the security breach have forced them to halt growth and wind down the protocol. “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 and monitoring expenses alone — requiring capital that we simply don’t have,” they explained.
Bunni suffered a major attack on September 2, losing $8.4 million across Ethereum and the layer-2 network Unichain, which immediately halted operations. The protocol, built on Uniswap v4, used an innovative Liquidity Distribution Function designed to optimize returns for liquidity providers. Prior to the attack, Bunni was experiencing rapid growth, with its total value locked rocketing from $2.23 million in June to nearly $80 million by mid-August.
Despite shutting down, the Bunni team has open-sourced its v2 smart contracts by shifting their license from Business Source License to the MIT license. This move allows developers worldwide to freely access Bunni’s unique features like liquidity distribution functions, surge fees, and autonomous rebalancing.
Users can still withdraw their assets through the website until further notice. Additionally, remaining treasury funds will be distributed to BUNNI, LIT, and veBUNNI token holders pending necessary legal approvals, though team members will not receive any payouts.
The team continues their cooperation with law enforcement to recover the stolen $8.4 million. Bunni’s closure comes just days after the founding team behind the layer-1 blockchain Kadena announced it would also be ceasing operations amid tough market conditions. While the Kadena network remains community-driven, its native token KDA has plummeted 70% since the announcement.
Read more: https://cointelegraph.com/news/bunni-dex-becomes-second-crypto-project-shutter-this-week