Sui DeFi protocol Full Sail to wind down after Switchboard incident
Full Sail, a Sui DeFi protocol, is shutting down after an attacker removed about $91,000 from three automated vaults during a security incident linked to oracle provider Switchboard. The team has paused new deposits, prioritized user compensation, and will move remaining pools to withdrawal-only mode.
The wind-down marks one of the most visible fallout events on Sui this year and underscores how oracle failures can ripple across multiple chains. Full Sail disclosed the breach on Saturday before confirming the full scope of losses and its decision to close permanently on Tuesday.
Key Takeaways
- Full Sail, a Sui DeFi protocol, is winding down after roughly $91,000 was stolen from three vaults.
- The incident is tied to a suspected compromise of Switchboard's Move-based oracle infrastructure.
- New deposits and LP reward claims are disabled; existing pools will shift to withdrawal-only mode.
- Full Sail plans to compensate users from protocol-owned liquidity, with the team covering any shortfall.
- Switchboard halted its network on Sui, Aptos, IOTA, and Movement while investigating.
What happened to the Sui DeFi protocol Full Sail?
Full Sail operates automated vaults on the Sui blockchain. Last week, a security incident affecting those vaults prompted the protocol to pause deposits and withdrawals while it investigated.
On Saturday, Full Sail confirmed a loss of funds tied to Switchboard, the oracle provider feeding price data into its systems. By Tuesday, the team announced on X that the Sui DeFi protocol Full Sail would wind down entirely rather than attempt a restart.
The attacker removed approximately $91,000 from three vaults. Full Sail immediately disabled new deposits and liquidity provider reward claims. Regular pools are expected to enter withdrawal-only mode after final security checks are complete.
How did the Switchboard oracle incident unfold?
Switchboard said in a Saturday post on X that it was investigating a potential compromise of its Move-based oracle implementations. As a precaution, it halted its network on Aptos, Sui, IOTA, and Movement.
Full Sail's automated vaults relied on Switchboard for pricing data. When that infrastructure was suspected of being compromised, vault logic on Sui was exposed to manipulation. The result was direct user losses inside Full Sail's three affected vaults.
The incident was not isolated to Sui. Virtue, a stablecoin lending protocol on IOTA, separately reported about $455,000 in losses and said the backing of its VUSD stablecoin had been impaired. Together, the events highlight cross-chain exposure when a shared oracle provider fails.
For broader context on how DeFi security events shape market sentiment, see our Fintech & Crypto Alerts coverage hub.
What compensation is Full Sail offering users?
Full Sail said repaying community depositors is its top priority. The protocol plans to use its remaining protocol-owned liquidity to compensate affected users. If those funds fall short, the team committed to covering the gap so depositors are repaid first.
Withdrawal and claim instructions are expected within the coming days. Users should monitor official Full Sail and Switchboard channels for verified updates rather than acting on unconfirmed social media posts.
Why does Full Sail's shutdown matter for Sui DeFi?
Oracle dependencies remain one of DeFi's weakest links. When a price feed provider serving multiple chains is compromised, protocols built on different networks can fail simultaneously.
Full Sail's permanent closure, rather than a temporary pause, signals the team judged the damage and reputational risk too severe to continue. For Sui DeFi users, the episode is a reminder to review which oracles underpin any protocol they use.
CoinTelegraph reported the initial disclosure and wind-down announcement in its coverage of the Full Sail shutdown, citing the protocol's public statements on X.