The High Court of Singapore has ruled in favor of the Fantom Foundation, ordering the Multichain Foundation, a cross-chain router protocol, to pay $2.1 million in compensation for losses incurred during a 2023 hack.
The hack took place in July last year when the Multichain Foundation experienced unusually large outflows, later confirmed to be a result of a hack.
Numerous protocols connected to the chain fell victim to the attack, resulting in over $210 million in asset losses across multiple chains, including Fantom, Ethereum, BNB, Cronos, Polygon, Arbitrum, zkSync, Optimism, and Moonbeam.
In response to the financial losses suffered, the Fantom Foundation brought the matter before the Singapore High Court, seeking compensation for the damages incurred.
Multichain’s Representatives Did Not Attened Court Hearing
During a court hearing held on June 3, representatives from Fantom presented evidence to the court, while Multichain’s representatives were absent from the proceedings.
Fantom’s representatives argued that the breach occurred due to the CEO of Multichain having ultimate privileges and control over the cryptocurrency assets stored in the Multichain Bridge.
The court, after considering the evidence presented, found that Multichain had admitted to the claim and had breached the user agreement.
Consequently, on July 8, the court awarded the Fantom Foundation $2.1 million for the losses suffered during the hack.
Fantom Foundation Update on Judgment Against Multichain.
https://t.co/Pi5RXJmhNW pic.twitter.com/ooseYW0NC2
— Fantom Foundation (@FantomFDN) July 8, 2024
However, it is worth noting that Fantom had claimed that its ecosystem losses accounted for approximately one-third of the total losses, which amounted to $210 million.
The ruling comes at a time when crypto-related losses from hacks and scams have surged.
According to research from blockchain security platform Immunefi, losses from hacks and scams in the second quarter of 2024 more than doubled compared to the same period in 2023.
In Q2, over $572 million was lost to hacks, compared to $220 million in Q2 2023.
The majority of these losses were attributed to centralized exchange hacks.
Crypto Market Recovers Over Half of Stolen Funds in Q2
The cryptocurrency market has shown great resilience in the face of adversity, achieving a record recovery rate of 77% for stolen funds in the second quarter of 2024.
In Q2 2024, $347.4 million of the stolen crypto funds were successfully recovered or frozen out of the total $512.9 million lost, according to Hacken’s Web3 Security Report Q2 2024.
“For the second consecutive quarter, the silver lining amid the alarming rate of theft in crypto is the amount of funds recovered,” the report wrote.
It is worth noting that cryptocurrency scams have thrived on X, with analysts attributing a significant portion of all crypto scams to scammers on the platform.
Scam Sniffer, a web3 anti-scam company present on X, conducted an analysis revealing that nearly $50 million is lost each month due to account impersonation on X.com.
Just recently, Binance co-founder Yi He raised concerns about the proliferation of cryptocurrency scams on X, questioning whether Musk would take action to tackle the issue.
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