DEFIREGULATION

Multichain Victims Rejoice! Fantom Seeks to Liquidate Multichain Assets, Aiming to Recover $60 Million in Losses

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Multichain Victims Rejoice! Fantom Seeks to Liquidate Multichain Assets, Aiming to Recover $60 Million in Losses

The public blockchain Fantom Foundation announced that it is planning to petition the High Court of Singapore to declare Multichain Foundation bankrupt and to help recover and distribute the lost or frozen assets through a designated liquidator. It is reported that the losses from the Multichain incident last year exceeded 65 million US dollars.

Review of the Multichain Asset Loss Incident

In July 2023, rumors surfaced about the well-known cross-chain protocol Multichain being hacked, team members being taken away by Chinese authorities, and an abnormal transfer of up to $126 million in user assets. The affected public chains include Fantom, Ethereum, and Polygon, among others.

Subsequently, the Multichain team confirmed that the founder, Zhao Jun, had sole control over the protocol's private keys and server control, and that the relevant equipment had been seized by authorities. To date, the lost assets remain unrecovered.

As an early infrastructure supported by Fantom, the Fantom Foundation has also declared the permanent shutdown of Multichain.

Multichain Confirms: Founder and Relatives Taken Away by Public Security, Operating Funds and Private Keys Whereabouts Unknown

Court Makes Preliminary Ruling in Favor of Fantom

The latest announcement from the Fantom Foundation revealed that, after multiple unsuccessful attempts to contact Multichain Foundation members, a lawsuit was filed last year alleging breach of contract and fraudulent representations to seek compensation for losses incurred in the Fantom ecosystem.

On January 30, the Singapore High Court issued a default judgment against the Multichain Foundation, which will favor the progression of subsequent compensation cases for Fantom:

Although Fantom is not responsible for the actions of third-party infrastructure partners and does not have the legal right to represent users in recovering funds, our legal team continues to track fund flows, report to authorities, and initiate lawsuits to enable other victims to recover lost assets.

Fantom Foundation Seeks Liquidation of Multichain Assets

Therefore, the Fantom Foundation plans to petition the court for the declaration of bankruptcy of the Multichain Foundation and the liquidation of its assets:

Following the recent judgment, we will petition the court with the Fantom Foundation's financial losses to appoint a liquidator to help recover and distribute assets that have been lost or frozen, similar to Chapter 7 bankruptcy proceedings in the United States.

In other words, if the petition is approved, the court will assess the losses suffered by Fantom and, through the liquidator, recover and take control of the Multichain Foundation's assets to repay creditors.