In a concerning turn of events for the Fantom ecosystem, data from DefiLlama reveals a significant drop in Fantom’s total value locked (TVL) over the past few months. Fantom, a blockchain platform known for its fast and scalable solutions, has seen its TVL dwindle from over $364 million in early May to approximately $69.56 million as of July 14, around 81%. This decline marks a substantial setback for the project, especially considering its TVL reached an all-time high of $7.5 billion in 2022.
Simultaneously, Fantom’s native coin, Fantom (FTM), has experienced a decline in its price during the same period. The coin’s value dropped from $0.41 to $0.275, reflecting the overall challenges faced by the Fantom ecosystem.
The decline in TVL and FTM’s price coincides with the recent announcement by Multichain, a key component of the Fantom ecosystem, about its shutdown. Multichain had previously provided server decentralization, access, and geolocation distribution assurances to Fantom. However, the arrest of Multichain’s CEO in May, who was the sole person controlling the company’s servers, prompted its closure.
The repercussions of Multichain’s shutdown were felt on July 6, when the platform was exploited, resulting in the withdrawal of over $125 million worth of cryptocurrencies from multiple wallets. This exploit significantly affected the Ethereum side of Fantom, Moonriver, and Dogechain bridges. The funds withdrawn represented a majority of the assets held on each of these bridges, posing a severe blow to the ecosystem.
In response to these challenges, Fantom’s co-founder Andre Cronje expressed frustration and acknowledged the difficulties in getting other teams on board. He mentioned working with relevant organizations to explore all available options and recover the lost assets. Additionally, Cronje stated that the team was engaging with Circle, Tether, TrueUSD, Binance, and others for native issuance, while also reviewing rollups for native bridge infrastructure.
“Multichain was a big blow, we had a lot of assurances from the team around the server decentralization, access, and geolocation distribution,” he wrote.
Cronje’s comments indicate that the foundation and its staff members were also affected by the exploited assets. Despite the setbacks, he reassured the community that the team would not leave the situation unresolved and would exert every effort to rectify the losses.
As AZCoin News recently reported, Geist Finance, a lending protocol, has made the unfortunate decision to permanently shut down following substantial losses resulting from an exploit on the Multichain platform. The announcement was conveyed through a social media post by Geist’s development team on July 14, leaving both its users and the wider crypto community in a state of astonishment.
Source: https://azcoinnews.com/fantoms-tvl-plummets-by-over-80-as-andre-cronje-says-multichain-was-a-big-blow.html