Gateio denies liquidity issues amidst Multichain CEO’s disappearance
The centralized cryptocurrency exchange Gate.io has denied rumors of financial instability on May 31, by stating that “there are no issues with our operations or withdrawals as rumored.” This statement was released after various Twitter channels had alleged that the exchange was experiencing a lack of liquidity due to an alleged connection with the cross-chain router protocol Multichain (MULTI).
The team at Gate.io has stated that the company’s “operations are running healthily” and that it is focused on creating an affiliated trading platform in Hong Kong called Gate.HK.
The rumors about Gate.io’s insolvency originated from a series of events related to Multichain. On May 24, blockchain analytics firm Arkham Intelligence posted data that showed large inflows of MULTI to Gate.io, which Arkham claimed was related to rumors that the protocol’s team was “allegedly being arrested in Shanghai.”
Following rumors of the @MultichainOrg team being allegedly arrested in Shanghai, some large holders of $MULTI have begun moving funds. Team wallets moving ~$3M of $MULTI to https://t.co/5ecSG3rKek have also spooked some investors, with $MULTI price falling 26.5% in 24h. pic.twitter.com/p2sQpu9Ass
- Microsoft’s CSO supports the idea that AI will aid humanity, but still endorses a letter warning of AI’s potential dangers
- Optimism drops 33% after token unlocks, more pain possible
- Indian banks advised to adopt AI and blockchain for future readiness
— Arkham (@ArkhamIntel) May 24, 2023
On May 25, Binance suspended deposits for various bridged tokens that relied on the Multichain protocol, including bridged versions of Polkastarter (POLS), Alpaca Finance (ALPACA), and Fantom (FTM). Binance said that these tokens were experiencing delayed transactions and temporarily paused deposits while seeking clarity from Multichain.
On May 31, Multichain posted a statement that its CEO was missing, adding that some of the protocol’s routers no longer work because only the CEO had access to the relevant servers. The same day, some Twitter users began posting images of transactions that were allegedly large deposits of FTM from Multichain team members to Gate.io.
[] JUST IN: There are rumors that the https://t.co/5YQLO0SsVt team has been arrested. The Multichain team has sent https://t.co/5YQLO0SsVt $10M USD in $FTM. Is this an ongoing larger-scale issue? ☠️ https://t.co/s29KYytChM pic.twitter.com/1XXbwGMoPs
— CoinSumption (@CoinSumption) May 31, 2023
Blockchain data confirms that more than $10 million of FTM was transferred from an unknown user to Gate.io on May 25-26. However, Cointelegraph was not able to determine the identity of the account owner who performed the transaction.
Related: Gate Group launches new virtual asset trading platform in Hong Kong
After seeing multiple deposits of MULTI and Fantom to Gate.io, some Twitter users suspected that the exchange was exposed to fallout from Multichain. However, the team at Gate.io has denied these rumors, stating that the exchange is processing all withdrawals and operating normally.
