Singapore High Court Orders Multichain to Compensate Fantom Foundation for $210 Million Hack Losses

Singapore High Court Orders Multichain to Compensate Fantom Foundation for $210 Million Hack Losses

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

In July 2023, the Chinese cross-chain protocol Multichain Foundation experienced unusually large outflows, which were later confirmed to be the result of a hack. This incident led to significant losses for many protocols connected to the chain, resulting in over $210 million in assets being compromised across multiple chains, including Fantom, Ethereum, BNB, Cronos, Polygon, Arbitrum, zkSync, Optimism, and Moonbeam.

Holding the Multichain Foundation Accountable

The Fantom Foundation reported their financial losses to the Singapore High Court, seeking compensation. During a recent court hearing on June 3, Fantom’s representatives presented collected evidence to the Singapore court, while representatives from Multichain were absent. Fantom’s 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 had admitted this claim on X and had breached the user agreement.

Fantom Foundation Recovers Losses

On July 8, the court awarded Fantom $2.187 million for the losses they suffered during the hack. However, Fantom had previously claimed that its ecosystem losses amounted to approximately one-third of the total losses, which were worth $210 million.

According to research from blockchain security platform Immunefi, losses from crypto hacks and scams more than doubled in the second quarter of 2024 compared to the same period in 2023.

Over $572 million was lost to hacks in Q2, compared to $220 million in Q2 2023, with centralized exchange hacks accounting for the majority of the losses. 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 peaked at the end of May and June.