Centralized crypto exchange Gate.io denied rumors of illiquidity on May 31. stating that "there are no problems with our trades or withdrawals as rumored." The statement comes after numerous Twitter channels alleged that the exchange was experiencing insolvency due to an alleged connection between it and the Multichain (MULTI) cross-chain router protocol.
The Gate.io team said that the company's "operations are running healthy" and that it is focused on establishing an affiliate t.reading deck in hong kong called Gate.HK.
Rumors about Gate.io's insolvency broke out after a series of events involving Multichain. On May 24, blockchain analytics firm Arkham Intelligence aware data showing large inputs from MULTI to Gate.io, which Arkham said was related to rumors that the protocol team was "supposedly arrested in Shanghai."
After the rumors of the @MultichainOrg equipment being allegedly arrested in Shanghai, some large holders of $MULTI They have started moving funds.
Team wallets moving ~$3M of $MULTI to https://t.co/5ecSG3rKek have also spooked some investors, with $MULTI the price falls 26.5% in 24 hours. pic.twitter.com/p2sQpu9Ass
โArkham (@ArkhamIntel) May 24, 2023
On May 25, Binance Deposits Suspended for various bridged tokens that were based on the Multichain protocol, including bridged versions of Polkastarter (POLS), Alpaca Finance (ALPACA), and Fantom (FTM). Binance said these tokens were experiencing delayed transactions and temporarily paused deposits while they sought clarity from Multichain.
On May 31, Multichain released 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 corresponding servers. On the same day, some Twitter users began posting images of transactions purporting to be large FTM deposits from members of the Multichain team on Gate.io.
[] ONLY IN:
There are rumors that the https://t.co/5YQLO0SsVt team has been arrested. The Multichain team has sent https://t.co/5YQLO0SsVt $10 million dollars in $FTM. Is this an ongoing problem on a larger scale? โโ ๏ธ https://t.co/s29KYytChM pic.twitter.com/1XXbwGMoPs
โ CoinSumption (@CoinSumption) May 31, 2023
blockchain data confirm that more than $10 million of FTM was transferred from an unknown user to Gate.io on May 25 and 26. Cointelegraph was unable to determine the identity of the account owner making the transaction.
Related: Gate Group launches new virtual asset trading platform in Hong Kong
After seeing multiple MULTI and Fantom deposits on Gate.io, some Twitter users suspected that the exchange was exposed to the fallout from Multichain.
The Gate.io team has denied these rumors, stating that the exchange is processing all withdrawals and operating normally.
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