Multichain Ceases Operations Due to Insufficient Funding

Multichain, a prominent cross-chain router protocol, has announced the unfortunate decision to halt its operations due to a lack of operational funds. The announcement comes in the wake of a report from blockchain analytics firm Chainalysis, which suggested that internal insiders may have orchestrated a “rug pull” leading to significant withdrawals.

In a tweet from Multichain’s official Twitter account on July 14, the team conveyed the distressing news of their impending closure. They cited an insurmountable challenge resulting from the absence of alternative sources of information and the corresponding operational funds, ultimately leaving them with no choice but to cease their business activities.

The team also drew attention to the fact that they have been unable to establish contact with their CEO, referred to as “Zhaojun,” ever since his detainment by Chinese authorities. According to the team, they have been in contact with Zhaojun’s family, who informed them that his computers, phones, wallets, and mnemonic phrases were confiscated by the authorities. In a statement, they expressed:

“Since the project’s inception, all operational funds and investor investments have been under Zhaojun’s control. Consequently, all team funds and server access are in Zhaojun’s possession, which is now inaccessible due to his detainment by the police.”

Additionally, the team revealed that Zhaojun’s sister had initiated an asset preservation act, transferring some funds to addresses under her control. However, subsequent news arrived that Zhaojun’s sister had also been detained by the police and was now uncontactable. Consequently, the Multichain team announced their decision to halt operations.

The Multichain predicament began in May when the platform’s routes were suspended for an upgrade, resulting in delays in fund transfers. Compounding the situation, cryptocurrency exchange Binance suspended deposit and withdrawal support for certain Multichain bridged tokens due to uncertainties surrounding the protocol.

Further exacerbating the platform’s woes, significant outflows from the Multichain MPC bridge platform raised concerns of an exploit. On July 6, on-chain observers concluded that the protocol had been hacked, as over $100 million worth of assets were withdrawn from its Fantom bridge on the Ethereum side.

As Multichain grapples with the lack of operational funds and the uncertain circumstances surrounding its CEO, the unfortunate decision to cease operations marks a disheartening chapter for the once-promising cross-chain router protocol.

For more news, find me on Twitter or subscribe to my YouTube channel.

What is your opinion on this issue? Leave me your comment below! I’m always interested in your opinion!

Leave a Reply

Your email address will not be published. Required fields are marked *

Recommended for you