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SpiritSwap, a decentralized exchange (DEX) operating on Fantom, will not cease operations in September as previously anticipated, following the entrapment of treasury funds in the problematic cross-chain protocol Multichain.
In a community vote held on Aug. 16, SpiritSwap participants approved a resolution to transition the project to Power, another nonfungible token platform and DEX also situated on Fantom. In exchange, Power will allocate 200,000 USD Coin (USDC) to the SpiritSwap treasury.
“Initially, I had requested a deposit of 20-30K to the treasury to cover the essential costs of SpiritSwap. However, the Power team is willing to go above and beyond by depositing 200,000 USDC,” stated Nzaru, the head manager at SpiritSwap, who announced his intention to leave the DEX after receiving a new job offer. “On the 30th, I will finalize the new team and conduct orientation sessions to prepare for the upcoming month,” he added.
Snapshot of the SpiritSwap takeover proposal. Source: Snapshot
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Before the acquisition, Power developers remarked: “We have the means and the desire to inherit SpiritSwap. This would be a direct benefit to the PNFT holders, the POWER community, and the SpiritSwap community.”
On Aug. 9, SpiritSwap announced it would cease operations by Sept. 1 if a team could not be found to take over following the Multichain exploit that depleted its entire treasury. Notably, Power was also affected by the Multichain incident but only experienced “small” losses, as its treasury assets were not bridged to Multichain.
After months of speculation, Multichain’s developers revealed in July that co-founder and CEO Zhanojung He was arrested by Chinese authorities in May on undisclosed charges. He reportedly held all access to Multichain’s private keys and servers for the $1.5 billion protocol at the time of his detention. Despite the lack of details regarding his arrest, funds belonging to Multichain and its users have been converted into stablecoins and private coins and moved out of the protocol. Some victims have since claimed that the Chinese police are involved in a complex embezzlement scheme concerning users’ funds.
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