In recent developments, the Multichain MPC bridge platform has witnessed significant outflows, with fears emerging of a potential exploit. Withdrawals exceeding half of the deposits in certain Multichain contracts on Ethereum have raised concerns among on-chain investigators and observers. This article delves into the details of the situation, explores the affected platforms, and highlights the ongoing investigations.
Unprecedented Outflows from Multichain MPC Bridge Platform
On July 6, crypto enthusiasts and blockchain analysts noticed substantial outflows from the Multichain MPC bridge platform, raising suspicions of a multi-million dollar exploit. Withdrawals amounting to approximately $102 million were observed from Multichain’s Fantom bridge on the Ethereum side. Additionally, $666,000 was withdrawn from the Dogechain bridge, while the Multichain Moonriver bridge contracts experienced outflows of $5,872,661.
The withdrawals from the Fantom bridge’s Ethereum smart contract comprised 7,214 Wrapped Ether (WETH) tokens worth $13.6 million, 1,024 Wrapped Bitcoin (WBTC) valued at $31 million, and $58 million worth of US Dollar Coin (USDC). The Dogechain bridge’s Ethereum contract saw a withdrawal of $666,000, representing over 86% of its total deposits, leaving only approximately $100,000 in remaining assets. Similarly, the Multichain Moonriver bridge contracts suffered a withdrawal of $5,872,661, resulting in only around $700,000 remaining on the platform.
Speculations and Investigations Sparked by Abnormal Transactions
The abnormal outflows triggered speculation among on-chain investigators and industry observers, with concerns of a potential exploit or hack. Peckshield, a prominent blockchain security firm, shared the transactions from the Fantom bridge on Twitter and tagged the Multichain team, suggesting they look into the matter. This led to one commenter referring to it as “another massive hack.” On-chain investigator Spreek also posted the Dogechain transactions, highlighting the depletion of funds with the comment “dogechain multichain drained.”
However, it is important to note that, at the time of publication, there was no confirmation whether the contracts were completely drained or if the withdrawals were made by authorized users. Cointelegraph reached out to the Multichain team on their Discord channel but had not received a response by the time of reporting.
Multichain, in a subsequent tweet, acknowledged the abnormal nature of the transactions and stated that they were uncertain about the cause. The team assured followers that an investigation was underway. Multichain functions as a multi-party computation (MPC) bridging network, employing a process where assets are locked on one chain and derivative assets are minted on another chain.
Technical Challenges and Recent Issues for Multichain
In recent weeks, Multichain has encountered technical problems, which have not been specified in detail. On May 31, the company announced that their CEO had gone missing, and they were facing multiple issues due to unforeseeable circumstances, leading to delayed transactions. These technical challenges could be contributing factors to the current situation.
Furthermore, on July 5, Binance, one of the prominent cryptocurrency exchanges, suspended withdrawals of certain Multichain derivative tokens. The halt was attributed to the network’s failure to process transactions in a timely manner.
Conclusion
The substantial outflows from the Multichain MPC bridge platform, including the Fantom, Dogechain, and Moonriver bridges, have raised concerns and sparked fears of a potential exploit. While investigations are underway, the Multichain team has acknowledged the abnormal nature of the transactions and is actively working to determine the cause. The situation highlights the importance of robust security measures and ongoing vigilance within the blockchain ecosystem to safeguard user assets and maintain trust in the industry.
