Multichain halts operations following CEO’s arrest; MULTI plunges 15% Multichain halts operations following CEO’s arrest; MULTI plunges 15%
The Multichain team said the protocol nodes and servers are under the control of its detained CEO.
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Updated: Jul. 14, 2023 at 3:32 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Cross-chain protocol Multichain (MULTI) is ceasing operations because CEO Zhaojun and his sister were “taken away” by the Chinese police, according to a July 14 statement on its official Twitter handle.
In its statement, the protocol explained how Zhaojun’s unavailability since May impacted its operation as all MPC nodes and ordinary servers were running under the CEO’s personal account. Additionally, the protocol’s operational funds and investments were under the control of the detained CEO.
Multichain said:
“Due to the lack of information about the case, the team could only maintain project operations to the best of their abilities through the remaining access on some non-MPC servers that hadn’t been revoked yet.”
Zhaojun’s sister’s role in Multichain’s situation
The protocol’s situation was exacerbated on July 7 after users’ assets on its MPC addresses were illegally transferred to an unknown address.
The Multichain team said Zhaojun’s sister informed them that “login information from an IP address in Kunming was found on the cloud server platform, along with a series of operations transferring funds from the MPC addresses.”
On July 9, the sister transferred the remaining funds from the MPC addresses to two new wallets under her control. However, recent information from Zhaojun’s family indicates that the sister was also detained on July 13, leaving the status of the digital assets she held uncertain.
Due to these incidences, Multichain also halted the bridge activities because of “the lack of alternative sources of information and corresponding operational funds.”
The Multichain team clarified their current limitations, including a lack of access to the domain account required for redirecting or shutting down the front end. Consequently, they requested the community’s assistance in spreading the news regarding Multichain’s cessation of operations.
Following this news, Multichain’s MULTI token plunged nearly 15% to $1.95 at the time of writing, according to CryptoSlate’s data.
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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