On Thursday, Multichain Protocol announced on Twitter that it could not contact its CEO, who had exclusive access to the project’s troubled servers. The announcement sent Multichain’s native token, MULTI, tumbling around 10%.
Rumors of Multichain’s Team Getting Arrested Becoming Stronger
MULTI token crashed over 10% on Thursday after reports broke that Zhaojun, CEO of the Multichain cross-chain protocol, is missing, giving strength to earlier rumors that the project’s top executives have been arrested in China. MULTI, the native token of Multichain, stood at $4.01 at press time.
“In the past two days, the Multichain protocol has experienced multiple issues due to unforeseeable circumstances. The team has done everything possible to maintain the protocol running, but we are currently unable to contact CEO Zhaojun and obtain the necessary server access for maintenance.”
– Multichain wrote on Twitter.
The multichain team also explained that Zhaojun was the only person with direct access to servers, which have grappled with technical issues in the past week, resulting in significant delays across cross-chain bridges. The protocol’s instability and speculations that the locked assets might have been compromised drove MULTI’s price down.
The reports of Zhaojun possibly going missing come roughly a week after rumors spread on social media that Chinese law authorities arrested Multichain’s top managers and confiscated $1.5 billion in smart contract funds.
A Potential Second Exploit in Two Years
If speculators are true, the latest developments will mark the second time Multichain was compromised. Previously known as Anyswap, the protocol was hacked in 2021, resulting in a $3.2 million exploit.
In May 2022, Multichain launched the MULTI token, airdropping the token to all users who had previously held Anyswap tokens. Multichain users use the token for several purposes, including paying fees, participating in governance, and accessing exclusive content.
The token’s launch was a major milestone for the Multichain project. It transitioned from a decentralized exchange protocol to a full-fledged cross-chain infrastructure platform. The protocol leverages smart contracts and decentralized liquidity pools to allow blockchains like Ethereum, Binance Smart Chain, Polygon, and others to interact with each other.
This article originally appeared on The Tokenist
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