Full Sail, a decentralized finance protocol on the Sui blockchain, is shutting down after an attacker removed approximately $91,000 from three of its automated vaults. The incident stemmed from a suspected compromise of oracle provider Switchboard's infrastructure last week.
The protocol announced its winding down on Tuesday, immediately disabling new deposits and claims for liquidity provider rewards. Full Sail committed to using its remaining protocol-owned liquidity to compensate users, with its team covering any shortfall to ensure community depositors are fully repaid.
Regular pools on Full Sail will transition to withdrawal-only mode following final security checks. The protocol expects to publish detailed instructions for withdrawals and claims within the coming days.
Switchboard posted on X last Saturday stating it was investigating a potential compromise of its Move-based implementations. The oracle network subsequently halted operations across Aptos, Sui, IOTA, and Movement blockchains.
The oracle compromise extended beyond Full Sail. Virtue, a stablecoin lending protocol built on IOTA, separately reported losses of about $455,000, which impaired the backing of its VUSD stablecoin.
Oracle networks supply external data to on-chain protocols for asset pricing and collateral valuation. A breach in such a data feed allows malicious actors to manipulate prices and drain funds from dependent DeFi applications.
