Multichain Acknowledges CEO’s Detention by Chinese Authorities, Reveals Plans to Cease Operations

The recently compromised cross-chain router protocol Multichain has declared it will cease its operations, attributing this decision to insufficient operational funds and the situation involving its CEO Zhaojun, who is currently detained by Chinese authorities. The most recent update from the team has confirmed the speculation regarding the executive’s arrest.

On July 14, Multichain announced via Twitter that Zhaojun has been unreachable by the team since his detention by the Chinese police at his residence. His sister has also been taken into custody.

Multichain Ceases Operations

After reaching out to the MPC node operators, the team discovered that their operational access keys to the MPC node servers had been revoked. They clarified that the MPC node servers were operating under the CEO’s personal cloud server account, to which he had exclusive access.

The team further found out that all of Zhaojun’s computers, mobile devices, hardware wallets, and mnemonic phrases had been seized by the authorities.

“Since the project’s inception, all operational funds and investments from investors have been managed by Zhaojun. This also indicates that all the team’s funds and access to the servers are with Zhaojun and the police.”

The Multichain team stated they have avoided sharing unauthorized information regarding the case with the public, following their lawyers’ advice.

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Daily operations were maintained using the existing access to servers that had not been revoked, along with assistance from Zhaojun’s sister, who reportedly transferred the remaining user assets in the router pool and subsequently informed the team and several project stakeholders of this asset preservation effort.

With Zhaojun’s sister also unreachable, the Multichain team indicated that the status of the preserved assets remains unclear.

$130M Exploit and Subsequent Developments

Multichain – formerly known as Anyswap – experienced an $8 million exploit in 2021.

However, issues first emerged in late May of this year, involving rumors about the protocol’s management team being arrested in Shanghai following the CEO’s disappearance. This situation escalated after the $130 million exploit that occurred earlier this week.

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