Singapore High Court Sanctions Legal Liquidation for Hacked Multichain

# Singapore Court Greenlights Liquidation of Multichain Foundation Post SonicLabs Appeal A Singapore court has sanctioned the compulsory liquidation of the Multichain Foundation, following a motion by blockchain technology entity SonicLabs. The Singapore High Court delivered this verdict on May 9, spurred by the significant financial and operational crises plaguing Multichain Foundation. According to Bitcoin.com on May 16, SonicLabs' motion aimed to reclaim damages from a notable hacking incident affecting Multichain Foundation. Known for enabling asset transfers across various blockchains, the cross-chain bridge project encountered severe hurdles after a July 2023 security breach led to the theft of $210 million in digital assets, around KRW 292 billion. The hacking incident severely impaired Multichain’s operations, halting the project’s activities. Aggravating the situation, Zhaojun He, CEO of Multichain Foundation, was reportedly detained by Chinese authorities. SonicLabs asserted that Multichain Foundation failed to settle its debts and compensate hack victims, prompting the liquidation filing. The Singapore High Court has appointed KPMG Singapore as the official liquidator. KPMG will oversee the recovery and distribution of Multichain's remaining assets to the affected users. Michael Kong, CEO of SonicLabs, expressed optimism over the liquidation order's impact on victims. On X (formerly Twitter), he remarked, “Due to the lack of cooperation from former Multichain employees, legal action was necessary. We hope this liquidation is the first step towards restoring the rights of all victims.” Kong’s post confirmed that KPMG's appointment as liquidator coincided with the court’s decision. Under KPMG’s management, Multichain Foundation’s retained assets will be gathered and redistributed to users harmed by the hack. This liquidation represents a pivotal legal event in the cryptocurrency sector, underscoring challenges in managing security breaches and handling resulting legal conflicts in blockchain projects. Additionally, it raises critical questions about governance, accountability, and user compensation in decentralized finance (DeFi) ventures.