Zhaojun He, CEO of troubled cross-chain protocol Multichain, has shown activity on his Telegram account for the first time since being detained by Chinese authorities in May 2023.
Zhaojun’s account now displays a “last seen recently” status, indicating the CEO has regained access to his phone and social media. This comes after Multichain suffered a catastrophic incident last year in which $1.6 billion in user assets were mysteriously drained from the platform.
He was apprehended in May during an unexplained investigation by Chinese police. With the CEO’s centralized control over Multichain’s assets and infrastructure, his detention left the protocol locked and inoperable. Users’ funds were subsequently moved without authorization to unknown wallet addresses.
In a recent message, Andre Cronje of Fantom confirmed rumors that the Chinese police had tracked stolen funds being laundered through Multichain, leading to the protocol operators’ arrest. Police then seized control of Multichain’s infrastructure to confiscate the laundered assets.
Fantom and other victims are pursuing legal action to recover lost funds. However, efforts within mainland China remain stalled without the ability to represent impacted foreign users.
Zhaojun’s resurfacing on social media may indicate that Chinese authorities have ended their investigation of the CEO himself. However, the status of detained Multichain developers and the misappropriated user funds remains unclear.
The incident illustrates the risks of protocols closely tied to founders with centralized control, especially within China’s crackdown on crypto. While reduced money laundering was an intended effect, collateral damage dealt to foreign investors has been substantial.
