Hector Network is the latest project to have been affected by the Multichain shutdown.
The majority of votes move to liquidate assets
The Hector Network, a team behind a decentralized finance (defi) project on the Fantom ecosystem, is taking steps to prevent further losses following the bridge hack on Multichain.
The project put forth a proposal to the decentralized autonomous organization (DAO), suggesting either to liquidate assets in the treasury or to migrate the Hector Network, the assets, and the HEC token to another chain under a different brand.
The snapshot reveals that 196 governance token holders have cast their votes, with 77.68% favoring liquidation over migration at the time of writing.
According to the proposal, the voting period will last for 48 hours, with two hours left before the time lapses. The Hector Network team said the reason for the timeframe was to “prevent further negative impact the Multichain hack may have on the Hector Network Treasury.”
Hector Network accused of depleting treasury funds
The Hector Network treasury, which was once worth more than $100 million, has seen a steady depletion over time. Currently, the project’s treasury holds assets worth $16.6 million and over one million HEC tokens, all of which could be liquidated.
The defi project forked from Olympus DAO, has faced some controversies, especially regarding its handling of the treasury.
Community members have criticized the project for its continuous lavish spending of the treasury without bringing any returns to token holders, which is often referred to as “slow rugging.” In June, Hector Network reported a hack on its bridge smart contract that resulted in the loss of over 600,000 USDC.
As previously reported by crypto.news, Multichain suffered a bridge hack that saw the abnormal movement of over $125 million on July 6 to several third-party wallets. Following the incident, major stablecoin issuers Circle and Tether froze assets worth over $65 million belonging to wallet addresses associated with the hack.
The cross-chain bridging protocol also halted operations after Chinese authorities arrested its CEO, who had sole control of investors’ funds, and his sister, who moved the remaining assets to a wallet address she controlled. According to the Multichain team, the project could not continue to function without access to operational funds.