The Fantom Foundation, the entity responsible for developing the Fantom Network, has secured a favorable judgement from the High Court of Singapore in its legal proceedings against Multichain, a cross-chain protocol.
The Foundation found itself at the receiving end of an exploit orchestrated by Multichain in July 2023, resulting in a substantial loss exceeding $210 million in assets. In response to this exploit, the Foundation initiated legal action against Multichain Foundation, citing “breach of contract and fraudulent misrepresentations” that contributed to Fantom’s financial losses.
In a statement posted on X (formerly Twitter), the company revealed that since the July 2023 Multichain exploit, both its management and legal team have been diligently working across various jurisdictions to devise a strategy for the partial recovery of lost assets by victims.
According to Fantom’s assertions, numerous attempts were made to engage with former directors and key individuals associated with the Multichain Foundation. However, these efforts proved fruitless, prompting the firm to pursue legal action against Multichain in Singapore, where the latter is incorporated.
The lack of cooperation from the Multichain team further complicated efforts to address the exploit, as detailed in a blog post released by Fantom on Monday. Despite the challenges posed by Multichain’s non-cooperation, Fantom remains steadfast in its commitment to seeking justice and recovering assets lost as a result of the exploit.
Fantom Plans Multichain Liquidation to Recover Funds
Fantom has submitted a petition to the Singapore court seeking the appointment of a liquidator for Multichain, with the aim of potentially recovering the funds lost due to the exploit.
According to Fantom, a court-appointed liquidator possesses the specialized expertise necessary to facilitate the tracing and retrieval of assets, thanks to their unique legal powers. Additionally, a liquidator will prioritize the interests of all creditors involved in the proceedings.
Furthermore, Fantom intends to leverage its legal triumph over Multichain to enlist suitably qualified experts in the endeavor to recover and distribute assets effectively.
Unfortunately, the Foundation faced another setback in October, experiencing a substantial loss of approximately $6.7 million in digital assets due to another hack. According to estimates by blockchain security firm Certik, the attackers managed to siphon off nearly $657,000 worth of crypto assets in this incident involving the Fantom Foundation.
