Nemo Protocol, a well-known project on the SUI blockchain, recently suffered a major hack, making headlines today. The attacker stole approximately $2.4 million and moved the funds between Arbitrum and Ethereum via the Circle CCTP bridge. This incident was a significant blow to both the project and its users. In response, Nemo Protocol has announced plans to compensate affected users and restore trust, acknowledging that the damage is manageable with the right steps.
How the Hack Happened
The exploit occurred between September 7 and 8, 2025, targeting a bug in Nemo’s code originally designed to reduce slippage. The hacker exploited this vulnerability to gain control of the system and steal funds. Nemo admitted that the code had not been audited prior to deployment, which made it easier for the attacker to find weaknesses. The breach caused many users to lose confidence and withdraw their investments.
The NEOM Token Compensation Plan
To compensate affected users, Nemo Protocol introduced a new debt-based token called NEOM. Under this plan, users receive 1 NEOM token for each loss incurred. Nemo intends to repay these tokens either in cash over time or through future profits. The unsafe flash loan feature has been removed, and the new code is undergoing an audit by the security firm Asymptotic.
Community Reactions
The response from the crypto community has been mixed. Some users view the NEOM plan as a positive, collaborative step toward recovery, while others remain concerned about potential future risks, such as the possibility of NEOM oversupply reducing its value. Despite these concerns, many users have expressed support for the initiative, sharing posts on social media encouraging others to “HODL” their tokens and back the protocol’s revival efforts.
