Multichain, a cross-chain router protocol that recently fell victim to hacking, has made the difficult decision to cease its operations. The company cited a dire lack of operational funds as the primary reason behind this unfortunate development. Furthermore, the whereabouts of Multichain’s CEO, Zhaojun, have become a cause for concern, as he is currently in the custody of the Chinese police.
In a recent update, Multichain took to Twitter on July 14 to confirm the rumors surrounding Zhaojun’s arrest. It was revealed that the CEO had been apprehended at his residence and has since been out of contact with the Multichain team. Disturbingly, his sister has also been taken into custody.
Upon reaching out to the MPC (Multi-Party Computation) node operators, Multichain discovered that their access keys to the MPC node servers had been revoked. The team explained that these servers were hosted under Zhaojun’s personal cloud server account, which he had exclusive control over. Furthermore, it was discovered that the authorities had confiscated all of Zhaojun’s electronic devices, including computers, phones, hardware wallets, and mnemonic phrases.
The Multichain team revealed that Zhaojun had complete control over all operational funds and investments since the inception of the project. Consequently, this meant that all of the team’s funds and access to the servers were in the possession of Zhaojun and the police. Following the advice of their legal counsel, the team refrained from disclosing any unauthorized information about the case to the public.
In order to continue their daily operations, Multichain relied on the remaining access to servers that had not been revoked. Additionally, they received assistance from Zhaojun’s sister, who facilitated the transfer of the remaining user assets in the router pool. Subsequently, the team notified various project parties about this asset preservation action. However, the current status of these preserved assets remains uncertain due to the unavailability of Zhaojun’s sister.
Multichain, formerly known as Anyswap, had already faced a major setback earlier this year when it fell victim to an $8 million exploit. However, their troubles escalated in late May when rumors surfaced about the arrest of the protocol’s management team in Shanghai following Zhaojun’s mysterious disappearance. The situation took a turn for the worse with the recent occurrence of a $130 million exploit.
Multichain has been compelled to shut down its operations due to the severe lack of operational funds. The arrest and subsequent unavailability of their CEO, Zhaojun, have further exacerbated the situation. Despite making efforts to preserve the remaining user assets, the uncertainty surrounding their status persists. Multichain’s struggles serve as a cautionary tale about the challenges faced by blockchain projects and the need for robust security measures.
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