The Fantom Foundation has reported a significant legal win, as the Singapore High Court has directed Multichain to provide compensation following a breach of contract. In response, Fantom plans to pursue liquidation proceedings through the court to recover community assets, including approximately $65 million in frozen stablecoins.
This legal development follows a dispute dating back to July 2023 when the Multichain bridge suffered an exploit, resulting in substantial losses across various chains, including Fantom. Despite attempts to communicate with Multichain’s former directors and key personnel, Fantom alleges that they were unable to resolve the matter, leading to legal action for breach of contract and fraudulent misrepresentations regarding incurred losses.
The Singapore High Court recently granted Fantom a default judgment ruling in its favor, affirming the breach of contract and fraudulent representations by Multichain. Fantom now intends to leverage its financial losses to request the court to initiate Multichain’s dissolution and appoint a liquidator to facilitate the recovery and equitable distribution of assets.
The liquidator, once appointed, will possess the expertise to trace and recover assets, with legal powers including the authority to retrieve or dispose of property, recover fraudulent transactions, and pursue legal actions. They will act in the best interests of all creditors and engage with relevant parties on behalf of the Multichain Foundation.
Multichain, a cross-chain bridge protocol, experienced unauthorized withdrawals totaling $210 million, prompting the cessation of operations after its CEO went missing and was subsequently arrested by Chinese authorities.
