Cross-chain protocol Multichain revealed on May 31 that its team has been unable to contact its CEO, Zhaojun, fueling rumors that the protocol’s leadership may have been arrested in China amid ongoing technical issues.
“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,” noted a Twitter thread. As reported by Cointelegraph, the protocol has experienced technical problems over the past week, with transactions delayed across multiple cross-chain bridges without a clear explanation.
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…
— Multichain (Previously Anyswap) (@MultichainOrg) May 31, 2023
According to rumors circulating on Twitter, the Chinese police arrested Multichain’s team and confiscated $1.5 billion in smart contract funds. Cointelegraph reached out to Multichain but did not receive an immediate response. As of now, the rumors remain unconfirmed.
It’s rumored that the multichain team has been arrested by the Chinese police, with 1.5 billion dollars of contract funds under control, and some team members transferred 494200 multi tokens from the team address to gate today. Please be aware of the risks.$multi #MultiChain pic.twitter.com/KpB9ehl5ls
— 0xfleet (@0xfleet) May 24, 2023
Based on Multichain’s tweet, some protocols were affected by problems on the Router5 node, which supports connections between chains. Having been unable to contact the CEO and lacking permission to address the issue, the team suspended services for over 10 chains, including Kekchain, Public Mint, DynoChain, Redlight Chain, Dexit, Ekta, HPB, Onus, Omax, Findora and Planq.
“In order to protect the interests of our users, we have decided to suspend the corresponding cross-chain service for the affected chain on the UI,” noted the protocol’s team.
On Twitter, crypto community members pointed out that Multichain’s inability to access the server and solve the problem shows the protocol is a “backward step” from decentralization.
I don’t get how such large profile projects are having issues like this. I mean really one dude so everything’s screwed. That kind of seems like a backward step as far as organizational structure goes not a forward step towards decentralization.
— Wonderwilds (@JerbzWee) May 31, 2023
In response to the ongoing issues without clear explanations, Binance suspended deposits for 10 bridged tokens on the BNB Smart Chain, Fantom, Ethereum and Avalanche blockchain networks on May 25. The unexplained downtime also led the Fantom Foundation to remove 449,740 MULTI ($2.4 million) from liquidity on the decentralized exchange SushiSwap. Blockchain analytics firm Lookonchain reported $3 million worth of MULTI outflows related to smart money accounts last week.