‍Key Takeaways

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• Cetus is a pioneer liquidity infrastructure on Sui, designed to bring high capital efficiency to DeFi trading using a Concentrated Liquidity AMM model. It addresses the need for better on-chain liquidity and trading experiences for various stakeholders.
  
  
• Backed by major investors and partners: The project secured seed funding from notable backers, including OKX Ventures, KuCoin Ventures, Animoca Ventures, Sui Foundation, and others.
  
  
• Unique features and benefits: Cetus offers concentrated liquidity pools (CLMM) for higher fee earnings, a “Super Aggregator” that sources the best prices from across the Sui network, permissionless pool creation for listing new tokens, a developer SDK for easy integration, and a dual-token staking model (CETUS and xCETUS) for governance and rewards.
  
  
• Token launch and tokenomics: Cetus held its Token Generation Event (TGE) in May 2023, coinciding with Sui’s mainnet launch. The CETUS token is now trading on major exchanges (e.g., Binance, OKX), and the project has detailed tokenomics with
  1 billion total supply allocated to community incentives, team, investors, and a treasury. 

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Introduction
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Cetus is a next-generation crypto exchange protocol bringing decentralized finance to the forefront of the Sui network. As a decentralized exchange (DEX), Cetus enables users to swap tokens, provide liquidity, and earn yields tailored to different trading strategies. The platform’s core innovation is its use of concentrated liquidity market-making, similar to Uniswap v3’s model, which vastly improves capital efficiency for liquidity providers. In this beginner-friendly guide, we’ll introduce Cetus’s purpose and features, its backing by major investors, and how it fits into the growing DeFi on Sui. We’ll also cover its token launch (TGE), tokenomics, and a step-by-step guide to start using Cetus with a Sui wallet like Backpack. By the end, you’ll understand how Cetus works and why it’s considered a cornerstone of the Sui DeFi landscape.

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What is Cetus?
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Cetus is a decentralized exchange (DEX) and liquidity protocol built on the Move based blockchain Sui. It aims to provide a flexible and efficient on-chain trading experience through two core components:

• Concentrated Liquidity Market Maker (CLMM): this feature allows liquidity providers to allocate their assets within specific price ranges, enhancing capital efficiency and enabling better fee earnings compared to traditional AMMs.
  
  
• Super Aggregator: This tool aggregates liquidity from major liquidity sources  within the Sui ecosystem with the support of smart ordering and gas considerations, ensuring traders receive optimal pricing and deep liquidity for their swaps.
  

Cetus is fully permissionless, allowing anyone to trade, add liquidity, or create new trading pools without restrictions. Developers can integrate Cetus's liquidity into their applications via its SDK or API, fostering a vibrant ecosystem of DeFi applications.

Launched as the first protocol on Sui in May 2023, Cetus has positioned itself as a foundational infrastructure within the ecosystem, similar to Uniswap's role on Ethereum. Its design leverages the high throughput and low fees qualities of Sui to deliver a seamless DeFi trading experience.

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Funding and Backing
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Cetus Protocol has secured substantial backing from prominent crypto investors, enhancing both its development and credibility within the community. Notable supporters include OKX Ventures, KuCoin Ventures, Animoca Ventures, and the Sui Foundation, among others. This strong institutional support underscores confidence in Cetus's role as a leading decentralized exchange and liquidity provider on Sui.

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Key Features and Benefits
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Cetus distinguishes itself through a range of features that cater to traders, liquidity providers (LPs), and developers:

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1. Concentrated Liquidity (CLMM) via Infinity Pools
Cetus adopts a Uniswap v3-style model, allowing liquidity providers (LPs) to deploy capital in specific price ranges. This boosts capital efficiency and fee earnings while giving traders deeper liquidity and lower slippage. LPs can automate strategies using Cetus Vault, which manages and rebalances positions.

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‍2. Super Aggregator for Best Swaps
Cetus routes trades through its own pools and other DeFi protocols on Sui using an in-built aggregator. This ensures users always get the best execution price and lowest slippage—similar to 1inch, but native to Cetus.

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3. Permissionless Pool Creation
Anyone can launch a token pair and set custom fees without approval. This fosters decentralization and rapid listing of community tokens or experimental assets, fueling long-tail growth in the Sui ecosystem.

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4. Developer SDK & API
Cetus offers dev-friendly tools for integrating swaps, liquidity, and pool data. Projects have the choice between embedding the full swap SDKs as well as out-the-box mini DEX widgets with minimal coding required, wallets can route trades, and yield protocols can automate liquidity flows—all using Cetus as backend liquidity infrastructure.

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5. CETUS & xCETUS Governance
Users stake CETUS to receive xCETUS, a non-transferable governance token. xCETUS unlocks protocol revenue share on a weekly basis, as well as other perks such as launchpad access, higher yields, and governance rights. This system aligns incentives for long-term protocol growth.
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Incentive Programs & Point Systems

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Since its launch, Cetus has implemented various incentive programs to encourage adoption and reward early users. In early 2023, during its pre-launch phase, Cetus introduced a testnet "points" campaign on Sui's permanent testnet. Users could interact with Cetus's alpha version—performing swaps, adding liquidity, and providing feedback—to earn points. While there was no guaranteed airdrop, active participation was suggested to potentially qualify for future rewards, attracting early adopters and power users.

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Beyond testnet incentives, Cetus engaged its community through platforms like Zealy (formerly Crew³). These platforms offered gamified tasks—such as joining Discord, sharing content, and completing tutorials—where users accumulated points on leaderboards. Top contributors were often rewarded with whitelist spots for token sales or exclusive NFTs, fostering community growth across SocialFi platforms.

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Following its launch, Cetus allocated a significant portion of its token supply (50% reserved for the community) to liquidity mining incentives. Notably, the "Mining the Alpha" campaign distributed 1,000,000 CETUS tokens to enhance liquidity in specific pools for flagship assets on Sui. Users providing liquidity or staking LP tokens earned CETUS emissions in addition to regular swap fees, improving pool depth and trading experiences.
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Token Generation Event (TGE) & Airdrop Timeline
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Cetus conducted its Token Generation Event in May 2023, aligning with the launch of Sui’s mainnet. The token launch was executed via a community IDO (Initial DEX Offering) on Cetus’s launchpad platform, followed by listings on major exchanges. According to official reports, the CETUS IDO took place on May 8, 2023, on Cetus Launchpad, allowing early supporters to buy CETUS tokens directly. Shortly after, on May 10, 2023, CETUS trading went live on prominent centralized exchanges OKX, and Binance the following year. This provided immediate liquidity and price discovery for the token. The TGE price (IDO price) and initial market cap were relatively modest, reflecting a community-focused launch without an overblown valuation. Within the first days of trading, CETUS saw significant volume (CoinMarketCap data showed daily volumes in the tens of millions of USD), indicating high interest. The token’s value performance post-TGE was volatile but generally trended upward as the Sui ecosystem hype grew in mid-2023.

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Tokens & Tokenomics

Cetus employs a carefully designed tokenomics model involving its CETUS token and the derived xCETUS token, along with a clear allocation breakdown to ensure long-term growth.
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‍Cetus Token (CETUS): Utility and Tokenomics Overview

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Cetus’s native utility token, CETUS, operates on the Sui blockchain with a maximum supply of 1,000,000,000 CETUS.

Token Utility

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CETUS is a cryptographically-secure fungible token designed exclusively for use within the Cetus ecosystem. It serves multiple purposes:

• Medium of Exchange: CETUS facilitates decentralized transactions within the protocol, enabling users to exchange value without intermediaries.
  
• Ecosystem Incentives: Distributed through liquidity mining, farming, and activity-based rewards to encourage user participation and contribution.
  
• Utility Functions: Used for various interactions and features across the Cetus protocol.
  
• Governance (Future Scope): While not explicitly mentioned, similar utility tokens often evolve to include governance features over time.

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Token Allocation

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• Community & LP: 50%
  
  
  • Distributed via mining, farming, and other liquidity incentivization schemes and marketing campaigns.
    
• Team & Advisors: 20%
  
  
  • Owned by the founding team contributors and key advisors; subject to a 12-month lock-up followed by 24 months of monthly vesting.
    
• Investors: 15%
  
  
  • Allocations to private investors; subject to a 6-month lock-up followed by 12 months of monthly vesting.
    
• Liquidity Treasury: 15%
  
  
  • Reserved for initial liquidity and long-term CEX/DEX liquidity maintenance.

Cetus Protocol has officially launched its escrowed governance token with the ticker symbol: xCETUS.

The ecosystem features multiple tokens for different purposes, including:

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• Liquidity Provider (LP) tokens: Representing shares in liquidity pools.
  
• Staked tokens (xCETUS): Used to earn rewards or unlock staking benefits.
  
• Governance tokens (xCETUS): Allowing token holders to vote on protocol decisions.
  
• Reward tokens: Incentivizing user participation through campaigns.
  
• Utility tokens (CETUS): Facilitating transactions or powering specific features within the ecosystem.

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xCETUS is a non-transferable, escrowed token obtained by staking CETUS. It serves multiple roles within the Cetus ecosystem:

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• Governance: xCETUS holders can propose and vote on protocol decisions, with voting power proportional to their xCETUS balance. Only xCETUS held in wallets (not in vesting) counts towards voting power.
  
• Launchpad Participation: xCETUS balances are considered for whitelist eligibility and determining allocation quotas in Cetus Launchpad events. xCETUS in vesting also contributes to these calculations.
  
• Loyalty Tiers: Holding xCETUS may grant users access to premium features, exclusive services, or enhanced rewards, depending on their loyalty tier determined by xCETUS holdings and user activity.
  
  

Conversion & Redemption:

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• CETUS to xCETUS: Users can convert CETUS to xCETUS instantly at a 1:1 ratio.
  

• xCETUS to CETUS: Redeeming xCETUS back to CETUS requires a vesting period selected by the user:
  
  • 15 days: 1 xCETUS → 0.5 CETUS
    
  • 180 days: 1 xCETUS → 1 CETUS
    
  • Intermediate durations yield proportional conversion ratios.
    
  • Unclaimed CETUS from shorter vesting periods is forfeited and transferred to the Eco Treasury for protocol sustainability and community incentives.
    
• Cancel Redemption: Users can cancel the redemption before the vesting period ends, retrieving their xCETUS without receiving any CETUS.

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How to Get Started with Cetus
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Getting started with Cetus is straightforward, even if you’re new to using a Sui wallet or DeFi platform. Follow these steps to begin trading or providing liquidity on Cetus:

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1. Set Up a Sui Wallet (e.g., Backpack): Install the Backpack Wallet app (available for mobile and browser). Create a new wallet and securely back up your recovery phrase. Ensure the Sui network is enabled within the app.

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2. Access the Cetus App: Open the Cetus app from Explore tab on Backpack wallet. The Cetus app is a web-based DEX interface. Now, connect your wallet by clicking “Connect Wallet”  choose Backpack from the list. Approve the connection in your wallet. You are now connected to Cetus and ready to use its features. The interface will show options for Swap, Pools, Farm, and Stake, along with your wallet balances.

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3. Swap Tokens on Cetus: To trade tokens on Cetus, go to the Swap tab, choose the token you want to swap and the one you want to receive (e.g., SUI for CETUS), enter the amount, and the app will auto-route the trade using its Super Aggregator for the best rate. Review the estimated output and price impact, then confirm and approve the transaction in your wallet.

4. Provide Liquidity (Become an LP): To provide liquidity on Cetus, go to the Pools tab, select a token pair (e.g., SUI/CETUS), choose a fee tier, set a price range, and deposit both tokens. Confirm the transaction in your wallet to start earning trading fees. Track your earnings in “ Positions.”

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Future Prospects
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Cetus Protocol is emerging as a pivotal decentralized exchange (DEX) and liquidity provider within the Sui ecosystem. As these Layer-1 blockchains expand, Cetus is poised to serve as the foundational liquidity infrastructure for a growing array of decentralized applications (dApps), including those in gaming, NFTs, and financial services. Notably, dApp integrations with wallets like Backpack enable seamless token swaps, enhancing user experience and broadening Cetus's reach.

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The protocol's emphasis on composability allows developers to build diverse financial products atop its platform, such as yield optimizers and automated liquidity managers. Cetus's "Liquidity as a Service" model, coupled with its developer-friendly SDK, facilitates integration into various applications, including games and cross-chain platforms. With existing cross-chain capabilities via partners like Wormhole and others, Cetus is well-positioned to evolve into a multi-chain DEX, enabling users to swap assets across different blockchains seamlessly.

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Governance is transitioning towards decentralization through the xCETUS token, granting holders voting rights on protocol decisions. This move fosters community involvement in areas like fee structures, treasury management, and incentive programs. Additionally, the introduction of fee-sharing mechanisms for xCETUS stakers further aligns user interests with the platform's success.Medium

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Looking ahead, Cetus aims to maintain its leadership by introducing new features to optimize  the user experiences for LPs and traders alike. Some notable upcoming releases to watch out for include introducing alternative approaches to fulfilling pricing demands leveraging the liquidity and capabilities of professional traders, and an expansion to the existing liquidity protocol with expected to double in scale to serve different LPs and asset classes with enhanced flexibility and on-chain yield opportunities. These developments, combined with its robust infrastructure and community-centric approach, position Cetus to play a central role in the future of DeFi on Sui and beyond.

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