Fantom Foundation Wins Legal Battle Against Multichain
The Fantom Foundation has announced that it has been granted a default judgment against Multichain by the Singapore High Court. This follows the breach of contract and fraudulent misrepresentations made by Multichain, resulting in significant losses for Fantom and other chains.
Fantom Plans for Multichain Liquidation
With this legal victory, Fantom is now seeking to liquidate Multichain through the court system. The objective is to retrieve community assets, including approximately $65 million in frozen stablecoins. Here’s what you need to know:
- Fantom suffered losses of around one-third of the total damages caused by the security breach.
- Efforts to communicate with Multichain’s former directors and key personnel were unsuccessful.
- Fantom initiated legal action for breach of contract and fraudulent misrepresentations.
The Implications of Liquidation
If the court approves the liquidation process, here’s what will happen:
- A liquidator will be appointed by the court to evaluate the damages suffered due to Multichain’s actions.
- The liquidator will have expertise in tracing and recovering assets.
- They will have legal powers to retrieve or dispose of property, recover fraudulent transactions, initiate investigations, and pursue legal actions.
- All creditors will be represented, and assets will be distributed equitably.
Background on Multichain’s Breach
Multichain was a cross-chain bridge protocol that experienced unauthorized withdrawals totaling $210 million. The breach affected multiple chains, including Fantom, Ethereum, BNB, Cronos, Polygon, Arbitrum, zkSync, Optimism, and Moonbeam. The company’s CEO, Zhaojun, went missing and was later arrested by Chinese authorities.
Hot Take: Fantom’s Legal Victory
Fantom’s recent legal triumph against Multichain marks a significant step towards recovering the community’s assets. By obtaining a default judgment and pushing for liquidation, Fantom aims to hold Multichain accountable for its actions and ensure a fair distribution of assets. This case highlights the importance of contract integrity and transparency in the crypto industry. As the legal proceedings continue, all eyes will be on the Singaporean court to see how it handles the liquidation process and what it means for the future of decentralized finance.
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