Linea, an Ethereum layer-2 blockchain, faced criticism after it revealed it had unilaterally halted block production due to a hack at Velocore, a decentralized exchange operating on its network. Over the weekend, Velocore suffered a hack resulting in the transfer of 700 ETH, worth over $2.6 million, off Linea's layer-2 network through a third-party bridge. In total, $6.8 million was lost from Velocore.

Linea explained its decision to pause the sequencer at block numbers 5081800 and 5081801, stating it was to prevent further funds from leaving via bridges and to give Velocore time to address the vulnerability. The blockchain also censored the hacker's addresses during the pause to mitigate the impact on Linea users, citing concerns that the hacker intended to sell tokens for ETH, which could disrupt the ecosystem further by draining liquidity pools.

While Linea's actions were deemed necessary by some due to the circumstances, critics within the crypto community argued that halting block production contradicted the decentralized ethos of the industry. Mert Mumtaz, CEO of Helius Labs and a supporter of Solana, acknowledged the rationale behind Linea's move but expressed concerns about its implications for the industry's integrity.

Alex Gluchowski, CEO of Matter Labs, emphasized the importance of decentralization in blockchain sequencers, urging all layer-2 solutions to prioritize decentralization to avoid such incidents in the future. He underscored that decentralizing the sequencer is crucial for maintaining a censorship-resistant environment and enhancing network security.

In response, Linea affirmed its commitment to decentralizing its network and sequencer to prevent similar occurrences. It outlined decentralization as a primary goal to achieve a censorship-resistant environment where block production cannot be halted or addresses censored. Despite highlighting the centralized operational support of rival networks, Linea reiterated its core value of promoting a permissionless environment for its ecosystem participants.