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Singapore High Court Orders Multichain to Compensate Fantom Foundation $2.187M for Hack Losses

The High Court of Singapore has mandated that the Multichain Foundation, a cross-chain router protocol, compensate the Fantom Foundation, a layer-1 platform, for losses resulting from a $210 million hack.

In July 2023, the Multichain Foundation, a Chinese cross-chain protocol, experienced unusually large outflows, later identified as a hack.

This attack impacted many protocols associated with the chain, resulting in over $210 million in asset losses across multiple chains, including Fantom, Ethereum, BNB, Cronos, Polygon, Arbitrum, zkSync, Optimism, and Moonbeam.

Fantom Foundation pursued legal action to hold the Multichain Foundation accountable.

They reported their financial losses to the Singapore High Court and sought compensation.

During a court hearing on June 3, Fantom’s representatives presented evidence to the Singapore court, but Multichain’s representatives did not attend. 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.

On July 8, the court awarded Fantom $2.187 million for losses suffered during the hack.

However, Fantom had previously claimed that its ecosystem losses amounted to approximately one-third of the total losses worth $210 million.

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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.

Over $572 million was lost to hacks in Q2 2024, compared to $220 million in Q2 2023. Centralized exchange hacks accounted for the bulk of the losses in the quarter.

Before 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 surged at the end of May and June.

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Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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