Multichain Liquidators Win Key Ruling as New York Court Extends Freeze on Stolen USDC

A New York bankruptcy court has granted provisional relief to Singapore-based liquidators overseeing the collapse of Multichain Foundation Ltd., directing stablecoin issuer Circle to keep wallets holding millions of dollars in stolen USD Coin (USDC) ￰3￱ David ￰4￱ of the ￰5￱ Court for the Southern District of New York issued the order on Thursday, extending the freeze on three Ethereum wallets tied to the July 2023 Multichain ￰6￱ ruling requires Circle to maintain the addresses on its blacklist, effectively blocking any movement of the roughly $63 million in stolen USDC until further ￰7￱ court’s decision marks a major step in the cross-border effort to recover assets drained from Multichain’s cross-chain bridge protocol, which lost more than $210 million in one of 2023’s largest DeFi ￰8￱ the Multichain Case: How Liquidators Win by Freezing USDC The order, issued under Section 1519 of the ￰9￱ Code, allows temporary relief before a foreign case receives formal recognition under Chapter 15, the framework that governs cooperation between ￰10￱ and foreign insolvency proceedings.), which obtained a seizure warrant shortly after the ￰11￱ DOJ later lifted the warrant after failing to identify the hackers, leaving Circle without a legal basis to keep the wallets ￰12￱ latest order restores that ￰13￱ Breach Forces Circle to Freeze $63 Million in USDC #USD Coin issuer @circle has frozen $63 million belonging to three wallet addresses associated with the hack of the cross-chain bridge platform Multichain. #CryptoNews #USDC ￰0￱ — ￰14￱ (@cryptonews) July 8, 2023 According to the court filing, the freeze is necessary to prevent competing claims over the same funds.

A group of ￰15￱ had filed a separate class action lawsuit against Circle in New York State court, seeking control of the stolen ￰16￱ case has now been paused following the federal court’s ￰17￱ moved the matter to the Southern District of New York under the Class Action Fairness Act, which allows large, multi-jurisdictional class actions to be heard in federal ￰18￱ the $125M Hack, Multichain Faces Its Final Chapter in Court The Multichain collapse, one of the most high-profile failures in the decentralized finance sector, stemmed from an exploit discovered in July ￰19￱ attackers drained over $125 million from Multichain’s bridge contracts on Fantom, Moonriver, and Dogechain, transferring funds to unknown ￰20￱ Bridge Exploit: Trader’s $280K Becomes $1.9 M Windfall A wallet address has transformed nearly 1.9 million #Fantom tokens, initially worth $280,000, into $1.9 million after the long-frozen Multichain Bridge momentarily opened. #CryptoNews ￰1￱ — ￰21￱ (@cryptonews) November 2, 2023 Multichain, formerly known as Anyswap, operated as one of the largest cross-chain bridge protocols, allowing users to move assets across blockchains like Ethereum, BNB Chain, Avalanche, and ￰22￱ platform had a total value locked of about $9.2 billion in early 2022, according to data from DeFiLlama, before its troubles began in ￰23￱ later surfaced that the company’s CEO, known as Zhaojun, had been detained in China , leaving the project in ￰24￱ the hack, affected projects, including the Fantom Foundation, launched legal actions in ￰25￱ March 2024, the High Court of Singapore issued a default judgment in Fantom’s favor , finding that Multichain had breached contractual ￰26￱ High Court of Singapore has ruled in favor of the Fantom Foundation, ordering the Multichain Foundation to pay $2.1 million. #Singapore #Fantom ￰2￱ — ￰27￱ (@cryptonews) July 9, 2024 By May 2025, the same court approved a winding-up order against Multichain Foundation Ltd. , appointing KPMG’s Bob Yap Cheng Ghee, Toh Ai Ling, and Tan Yen Chiaw as joint liquidators to oversee asset recovery and ￰28￱ frozen $63 million in USDC represents a portion of the total $210 million stolen from ￰29￱ liquidators are seeking to recover these assets as part of the broader winding-up ￰30￱ their U.

S. filing, they described the New York court’s provisional relief as “an effective mechanism to implement Chapter 15’s policies of promoting cooperation between courts of the United States and foreign courts involved in cross-border restructuring cases.”