Sonic Labs Wins Court Order to Liquidate Multichain Foundation

Sonic Labs CEO Michael Kong announced that the Singapore High Court has approved the liquidation of Multichain Foundation, appointing KPMG’s Singapore branch as liquidators.

Multichain’s Refusal to Cooperate Forced Sonic Labs’ Hand

Sonic Labs CEO Michael Kong said the Singapore High Court has approved his firm’s application to liquidate Multichain Foundation. Kong revealed that the court, which issued its ruling on May 9, also appointed personnel from the accounting firm KPMG’s Singapore branch as liquidators.

In a post on X, Kong justified Sonic Labs’ decision to seek Multichain’s liquidation, stating that the foundation’s refusal to cooperate had forced the company’s hand. As reported by Bitcoin.com News in July 2024, Sonic Labs (formerly Fantom Foundation) was awarded $2.19 million in damages in a case against Multichain Foundation. The case stemmed from Multichain’s failure to deliver 4.175 million FTM tokens or their equivalent value.

Sonic Labs sought damages after a security breach on July 7, 2023, which led to the loss of more than $210 million in assets, including stablecoins ( USDT, USDC, DAI) and wrapped tokens held on the Multichain Bridge. On Sept. 18, 2023, the court assessed the diminished value of the lost assets and awarded Sonic Labs $58,620.55 for stablecoins and $2,129,250 for 4.175 million FTM tokens, based on market value calculations.

Despite the court ruling, Multichain Foundation has yet to comply, prompting Sonic Labs to seek further legal action.

“Unfortunately, since Multichain and its former employees have been completely uncooperative, we were compelled to file a lawsuit against Multichain and forcibly wind up the company. If Multichain had not hidden from victims, this entire process would have been unnecessary, and we would have saved more than a year,” Kong stated on X.

Kong said the appointed liquidators will now begin working with other parties to secure funds that could eventually be returned to affected users, pending the outcome of legal proceedings.