Crypto Project Multichain Shuts Down, Says CEO Arrested in China

Multichain, a crypto project that connects different blockchains, said it’s shutting down after learning that its founder was taken away by Chinese police.

In a Twitter post on Friday, Multichain provided details around the sudden disappearance of its founder and chief executive, identified only by the name Zhaojun, in late May. Multichain is a so-called crypto bridge, which allows users to swap digital tokens across the various blockchains they run on.

Speculation around Zhaojun’s whereabouts has been swirling since his disappearance, fueled by Multichain’s announcement on July 7 that it had seen an unexpected outflow of assets of more than $120 million. After that, Zhaojun’s sister transferred remaining user assets to wallets she controlled before she was taken into custody as well, Multichain said on Friday.

Digital-asset security specialist BlockSec flagged additional outflows of $103 million from Multichain on July 11, linking them to her addresses.

Read more: Mystery $120 Million Outflow Hits Crypto Bridge With Missing CEO

In addition to taking Zhaojun away, “computers, phones, hardware wallets, and mnemonic phrases were confiscated by the authorities,” Multichain said. It didn’t say why Zhaojun was taken away.

China’s Ministry of Public Security didn’t immediately respond to a fax seeking comment.

“Since the inception of the project, all operational funds and investments from investors have been under Zhaojun’s control. This also means that all the team’s funds and access to the servers are with Zhaojun and the police,” the tweet said.

The total value of assets locked on Multichain has dropped from $1.2 billion on July 11 to just $139 million as of Friday, according to data from DefiLlama.

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