Multichain Shuts Down as CEO Remains Missing in China

Multichain, previously known as Anyswap, said it is ceasing operations on July 14, citing a lack of operational funds and limited resources. The decision comes after the project’s CEO went missing in May, causing the Multichain team to lose access to its servers.

Multichain Shuts Down Due to Lack of Funds and Information

Cross-chain router protocol Multichain announced on Friday it is shutting down “due to the lack of alternative sources of information and corresponding operational funds.” The move was announced in an extensive Twitter thread post, in which Multichain elaborated on the various challenges it encountered that ultimately led to its demise.

The protocol’s woes began on May 21, 2023, when the Chinese police detained Multichain CEO Zhaojun. Since then, the global Multichain team has been unable to contact their boss. Furthermore, the team completely lost access to the multi-party computation (MPC) node servers because they were running under Zhaojun’s cloud server account.

The rest of the Multichain squad then contacted Zhaojun’s family, from whom they learned authorities had confiscated all of Zhaojun’s electronic devices. This left the Multichain team with limited resources, given that the project’s funds and server access are with Zhaojun and the police.

A Dramatic Story or Just a Typical Rug Pull?

Later on, Zhaojun’s family established contact with the police and notified the Multichain team that the CEO would soon be released. The employees were asked to continue maintaining the system and await further updates. However, on July 7, user assets locked on the MPC addresses were unexpectedly transferred to unknown addresses.

“According to Zhaojun’s sister, 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.”

– Multichain wrote on Twitter.

Two days later, Zhaojun’s sister moved the remaining user funds to the router pool and informed Multichain of this move. However, on July 14, the Chinese police detained Zhaojun’s sister, who has been out of contact ever since.

“The status of the assets she has preserved is uncertain, so the team believes it is necessary to inform the community about all the known circumstances.”

– it added.

The latest developments prompted some in the crypto community to believe that the ongoing Multichain drama is just a facade and that the whole thing may be a rug pull – a fraudulent act in the cryptocurrency space where the project creators abruptly exit, taking investors’ funds with them. Before it was confirmed that Zhaojun was arrested, the Multichain team promised to compensate the users affected by network issues.

This article originally appeared on The Tokenist

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