‘Multichain was a big blow,’ says Andre Cronje as Fantom TVL slumps

According to data from DefiLlama, Fantoms total value locked (TVL) dropped from over $364 million in early May to about $70 million on July 14. With its management apprehended and technical challenges installing, Multichain was made use of on July 6, with over $125 million worth of cryptocurrencies withdrawn from multiple wallets, affecting the Ethereum side of Fantom, Moonriver and Dogechain bridges. Prior to the hack, over $29 million worth of crypto assets were locked in agreements running on the Fantom network.

The Fantom networks co-founder Andre Cronje stated Multichains current ordeal was a “big blow” to the clever contract platform, which saw a sharp decline in activity in the past few weeks. According to information from DefiLlama, Fantoms total worth locked (TVL) dropped from over $364 million in early May to about $70 million on July 14. At its peak in 2022, Fantoms TVL topped $7.5 billion. The price of its native token, Fantom (FTM), declined from $0.41 to $0.28 in the very same duration.”Multichain was a huge blow,” Cronje wrote in a thread on Fantoms forum, adding that he “had a lot of guarantees from the [Multichain] team around the server geolocation, gain access to, and decentralization circulation.” “Dont trust, confirm (saying this to myself),” Cronje said.Fantoms TVL between May and July 2023. Source: DefiLlamaCronjes remarks follow Multichains statement on July 14 that it was closing down operations following the arrest of its CEO in May, the only individual in control of Multichains servers. With its leadership arrested and technical challenges mounting, Multichain was made use of on July 6, with over $125 million worth of cryptocurrencies withdrawn from numerous wallets, impacting the Ethereum side of Fantom, Moonriver and Dogechain bridges. These withdrawals represented the majority of funds hung on each bridge.Multichain was keeping all fragments of its private secrets in a “cloud server account” under the sole control of its CEO, Cointelegraph reported. This cloud server account was later on used by someone to drain funds from the protocol.The causal sequence of Multichains problems also impacted the loaning procedure Geist Finance, which was forced to close down permanently due to losses from the exploit. Prior to the hack, over $29 million worth of crypto properties were secured agreements operating on the Fantom network. Geist closing had an enormous impact on Fantoms TVL. In response to the exploit, stablecoin companies Circle and Tether have actually frozen over $65 million in properties connected to the attack. Fantom is said to be engaging with both business for native issuance and examining rollups for native bridge infrastructure. “We are checking out all options at this moment, working with relevant companies to try and recover assets,” Cronje stated. Gather this short article as an NFT to maintain this moment in history and show your assistance for independent journalism in the crypto space.

Other Questions People Ask

What did Andre Cronje mean by ‘Multichain was a big blow’ as Fantom TVL slumps?

Andre Cronje referred to the significant impact of Multichain's issues on the Fantom network's total value locked (TVL). He highlighted that the withdrawal of over $125 million from various wallets following the exploit severely affected the network's activity and trust. Cronje's comments indicate that the problems with Multichain have led to a drastic decline in user confidence and engagement within the Fantom ecosystem.

How did Multichain's problems affect Fantom's total value locked (TVL)?

The troubles with Multichain directly contributed to a sharp decline in Fantom's TVL, which plummeted from over $364 million in early May to around $70 million by July 14. This drop was exacerbated by the exploit that drained significant funds from the network, leading to decreased activity and investment. The situation was further worsened by the closure of Geist Finance, which had a substantial amount of assets locked on the Fantom network.

What actions are being taken by Fantom in response to Multichain’s issues?

In light of the challenges posed by Multichain, Fantom is actively engaging with stablecoin companies like Circle and Tether to recover frozen assets linked to the exploit. Additionally, Cronje mentioned that they are exploring various options, including rollups for native bridge infrastructure, to enhance security and restore confidence in the network. These measures aim to mitigate the damage caused by the recent events and stabilize Fantom's ecosystem.

What were the consequences of the Multichain exploit on other projects within the Fantom network?

The Multichain exploit had a ripple effect on other projects, notably causing Geist Finance to shut down permanently due to significant losses incurred from the incident. Prior to the hack, Geist had over $29 million worth of crypto assets locked in agreements on the Fantom network. This closure not only impacted Geist but also contributed to the overall decline in Fantom's TVL and user trust.

What does Andre Cronje suggest about trust in decentralized finance following Multichain’s issues?

Andre Cronje emphasized the importance of verifying trust in decentralized finance, stating, "Don't trust, confirm." His remarks reflect a growing concern about reliance on centralized entities within the DeFi space, particularly after Multichain's centralized control led to significant vulnerabilities. Cronje's perspective encourages users and developers alike to prioritize transparency and security in their engagements with blockchain projects. This directly relates to ‘Multichain was a big blow,’ says Andre Cronje as Fantom TVL slumps in practical terms.