Multichain Foundation to pay $2.1M to Fantom for losses

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The High Court of Singapore has ordered the Multichain Foundation, a cross-chain router protocol, to compensate the Fantom Foundation, a layer-1 platform, for losses incurred during a $210 million hack.

In July 2023, the Chinese cross-chain protocol Multichain Foundation witnessed abnormally large outflows, later confirmed as a hack. As a result, many protocols associated with the chain fell victim to the attack, leading to the loss of over $210 million in assets across multiple chains, including Fantom, Ethereum, BNB, Cronos, Polygon, Arbitrum, zkSync, Optimism and Moonbeam.

Holding Multichain Foundation accountable in court

The Fantom Foundation reported its financial losses to the Singapore High Court and sought compensation for the losses incurred. 

During a recent court hearing on June 3, Fantom’s representatives presented evidence collected to the Singapore court, while Multichain’s representatives were absent from the proceedings. Fantom representatives stated:

“The Claimant’s position is that the breach was possible because the CEO of the First Defendant had ultimate privileges and control over the cryptocurrency assets stored in the Multichain Bridge.”

The court found that Multichain admitted this claim on X and breached the user agreement as well.

Fantom Foundation recovers losses

On July 8, the court awarded Fantom $2.187 million for losses suffered during the hack. However, Fantom previously claimed that its ecosystem losses amounted to approximately one-third of the total losses worth $210 million.

Related: Crypto exploits near $1.4B this year as hackers target CeFi — report

Crypto losses from hacks and scams more than doubled in the second quarter of 2024 compared to the same period in 2023, according to research from blockchain security platform Immunefi.

Two biggest hacks of Q2 2024. Source: Immunefi

Over $572 million was lost to hacks in Q2, compared to $220 million in Q2 2023. Centralized exchange hacks accounted for the bulk of the losses in the quarter.

Prior to the second quarter, losses from hacks and scams had been declining, with Immunefi reporting a 23% reduction in Q1. This decline continued through April and most of May but peaked at the end of May and June.

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