One of the largest cross-chain bridge protocols, Multichain, has announced that it is ceasing operations following recent events. The protocol experienced a significant security breach on July 6, resulting in the theft of $125 million. Consequently, the CEO and his sister, who had control over operational funds, were reportedly detained. These events have left the Multichain team without the necessary resources to continue operations.
The security breach, which involved the unauthorized withdrawals of $120 million from Multichain’s Fantom bridge, has been described as a possible rug pull by insiders, according to a report by blockchain security firm Chainalysis. This incident followed a previous event in which leading crypto exchange Binance suspended deposits and withdrawals of Multichain bridged tokens.
Multichain has faced various challenges in recent months, including the arrest of CEO Zhaojun by Chinese authorities in May. The CEO had control over operational funds and investments, and authorities confiscated several key assets, including computers, phones, hardware wallets, and mnemonic phrases. Now, Zhaojun’s sister, who transferred remaining user assets to an address under her control, has also been detained.
Due to the lack of alternative sources of information and operational funds, Multichain has been forced to halt operations. The future of the protocol and its native token, MULTI, remains uncertain. MULTI price has already dropped by 4% in the past 24 hours and over 16% in the past week, further decline is expected as a result of these recent events and concerns about rug pull moves.
Frequently Asked Questions (FAQ)
What is Multichain?
Multichain is a cross-chain bridge protocol that allows for interoperability between different blockchain networks.
What happened to Multichain?
Multichain recently suffered a security breach in which $125 million was stolen. The CEO and his sister, who controlled operational funds, were reportedly detained. As a result, Multichain has decided to cease operations.
What is a rug pull?
A rug pull refers to a deceptive maneuver in which the developers or insiders of a cryptocurrency project suddenly abandon the project, causing the value of the token to plummet.
What will happen to the MULTI token?
The future of the MULTI token is uncertain following Multichain’s decision to cease operations. The token’s price has already experienced a significant decline, and further drops are expected as a result of these recent developments.
Is there a possibility of recovering the stolen funds?
It is unclear whether the stolen funds will be recovered. The protocol’s announcement suggests that the status of the assets controlled by the CEO’s sister is uncertain, indicating that recovery may not be possible.
Is Multichain the only protocol to have faced such security breaches?
No, various blockchain protocols and projects have encountered security breaches and attacks in the past. Security remains a significant concern in the crypto industry, and investors should exercise caution when participating in these platforms.
Multichain, a leading cross-chain bridge protocol, has announced the cessation of its operations following a significant security breach and the subsequent detainment of the CEO and his sister. The theft of $125 million and the uncertainty surrounding operational funds have forced Multichain to halt its operations. The future of the protocol and its native token, MULTI, is uncertain, and the token’s price has already experienced a considerable decline. Investors are advised to stay updated on the situation and exercise caution when dealing with the MULTI token.