- A suspected multi-million dollar exploit led to a massive outflow of $122 million via the Fantom bridge, causing Multichain to suspend operations.
- Amidst already existing technical difficulties and an absent CEO, Multichain protocol further instructs users to suspend usage and revoke all related contract approvals.
In an extraordinary turn of events on July 6, Multichain, a cross-chain protocol, observed unusually large outflows from its platform in what appears to be a significant exploit. Following this development, Multichain announced the suspension of all operations.
The Incident and Aftermath
The alleged exploit saw multiple chain assets, valued at a staggering $125 million, outflowing to various wallets from Multichain. The Fantom bridge, with its entire holdings in wBTC, USDC, USDT, and other altcoins moving out, bore the brunt, accounting for an enormous $122 million outflow.
Post-incident, Multichain issued a public statement through its official Twitter account, announcing that it is investigating the situation. The tweet reads:
“The lockup assets on the Multichain MPC address have been moved to an unknown address abnormally. The team is not sure what happened and is currently investigating. It is recommended that all users suspend the use of Multichain services and revoke all contract approvals related to Multichain.”
This event follows a period of difficulty for Multichain as the protocol has been grappling with technical issues, compounded by the absence of its CEO. The crypto community had been on high alert after three unaccounted outflows from Multichain’s Fantom, Moonriver, and Dogecoin bridge contracts raised concerns of a possible security breach.
Ripples Across the Crypto World
As reported by crypto analyst Colin Wu, using data from deExplorer, some users are leveraging DLN Trade to swap assets on the Fantom chain for those on other chains at discounted rates. Recent transactions revealed Fantom 1 USDC could be converted into BSC 0.9 USDC, Polygon 0.88 USDT, and more, at approximately a 10% markdown.
In a related development, Binance, a leading crypto exchange, suspended deposits and withdrawals for eight altcoins tied to the Multichain protocol a day prior. This decision affects several altcoin projects, including Alchemy Pay (ACH) on the BNB Smart Chain, Spell Token (SPELL) on the Avalanche C-Chain, and six other projects with lower market caps on Ethereum and Fantom.