Recently, Asia has been once again thrown into a flurry of crypto-related news, with the Multichain saga in China and Binance‘s large-scale layoffs making headlines.
Multichain, a Chinese decentralized cross-chain bridge protocol, experienced a significant blow when its co-founder and CEO Zhao Jun was arrested. Zhao Jun was the sole possessor of the private keys to over $1.5 billion in user assets stored on Multichain. Even after his arrest in May, the protocol operated for two months without notifying users of this significant event. Instead, they cited delayed fund transfers on a backend node upgrade.
The situation progressed from an unsettled sense of worry to a flurry of panic when unauthorized withdrawals of over $100 million were detected. This ignited concerns that the operation’s security may have been compromised internally. With the subsequent arrest of Zhao Jun’s sister, who reportedly made asset transfers after her brother’s arrest, there was a grim realization that all operational control was concentrated in the hands of two individuals.
This episode not only highlights the risks laden in a decentralized protocol that is ironically under the control of a singular authority but also raises questions about the future and safety of user assets. Currently, it remains unclear why Zhao Jun was arrested and how this could impact the user assets held under his control.
In a parallel narrative, Binance, the crypto exchange, has been making news for all the wrong reasons. The company, which recently celebrated its sixth anniversary, surprisingly marked the occasion with mass layoffs. As per reports, approximately 1,000 staff members, mostly from the global and customer service sectors, were shown the door.
This comes at a time when Binance is staring at an upcoming investigation by the U.S. Department of Justice, a formidable challenge for any company. In response to the layoffs, CZ, the company’s CEO, played down the situation by claiming that such actions are common in every company. Despite the layoffs, Binance announced that it is still hiring and listed 96 positions on its website.
However, it seems that the ripple effects of the layoffs continue to disrupt employee benefits. Binance reportedly ceased reimbursements for mobile phones, fitness, and remote work allowances, citing discouraging market conditions and the regulatory environment. These events underscore significant operational challenges for Binance, which is already grappling with legal battles with the U.S. Securities and Exchange Commission and the U.S. Commodities and Futures Trading Commission.
Overall, these events shine a spotlight on the uncertainty and vulnerabilities that can arise in the crypto and blockchain frontier, reaffirming the importance of prudent oversight, security, and transparency.
Source: Cointelegraph
