Multichain Liquidators Win Key Ruling as New York Court Extends Freeze on Stolen USDC

A bankruptcy court in New York has granted preliminary relief to the Singapore-based trustees overseeing the collapse of Multichain Foundation Ltd., ordering stablecoin issuer Circle to keep wallets containing millions of dollars in stolen USD coins (USDC) frozen.

Judge David S. Jones of the United States Bankruptcy Court for the Southern District of New York issued the order on Thursday, extending the freeze on three Ethereum wallets linked to the July 2023 Multichain hack.

The ruling requires Circle to maintain the blacklisted addresses, effectively blocking any movement of the approximately $63 million in stolen USDC until further notice.

The court’s decision marks a significant step in the cross-border effort to recover assets extracted from Multichain’s cross-chain bridge protocol, which lost more than $210 million in one of the biggest DeFi exploits of 2023.

Inside the Multichain Case: How Liquidators Win by Freezing USDC

The order, issued under Section 1519 of the US Bankruptcy Code allows temporary relief before a foreign case receives formal recognition under Chapter 15, the framework governing cooperation between US courts and foreign insolvency proceedings.

Singapore-appointed liquidators of KPMG Services Pte. Ltd. filed for a preliminary injunction on Oct. 23, arguing that lifting Circle’s freeze could cause “immediate and irreparable harm” by making stolen assets impossible to recover.

The request was intended to safeguard the funds until the U.S. court decides whether the Singapore case should be recognized as a “foreign main proceeding,” a designation that would allow the administrators to pursue recovery efforts in all jurisdictions.

Circle, which issues the US dollar-pegged USDC stablecoin, typically enforces freezes by blacklisting addresses directly through the token’s smart contract, a feature that blocks all transfers involving these wallets.

The company first froze the three hacker-linked addresses in October 2023 at the direction of the US Department of Justice (DOJ), which obtained a seizure order shortly after the exploit.

The DOJ later revoked the order after they were unable to identify the hackers, leaving Circle without a legal basis to keep the wallets locked. The final order restores that authority.

According to the court, the freeze is necessary to prevent competing claims over the same funds. A group of US investors had filed a separate class action lawsuit against Circle in New York State court, seeking control of the stolen USDC.

That case is here now paused after the federal court ruling. Circle moved the case to the Southern District of New York under the Class Action Fairness Act, which allows large, multi-jurisdictional class actions to be heard in federal court.

After the $125 million hack, Multichain faces its final chapter in court

The collapse of Multichain, one of the most high-profile failures in the decentralized finance industry, stemmed from an exploit discovered in July 2023.

Unidentified attackers withdrew more than $125 million from Multichain’s bridge contracts on Fantom, Moonriver and Dogechain, transferring funds to unknown addresses.

Multichain, formerly known as Anyswap, served as one of the largest cross-chain bridge protocols, allowing users to move assets across blockchains such as Ethereum, BNB Chain, Avalanche and Polygon.

The platform had a total value of approximately $9.2 billion at the beginning of 2022, according to on data from DeFiLlama, before the problems started in mid-2023.

Reports later surfaced that the company’s CEO, known as Zhaojun, had been arrested in China, leaving the project in disarray.

Following the hack, affected projects, including the Fantom Foundation, took legal action in Singapore. In March 2024, the High Court of Singapore issued a default judgment in Fantom’s favor, ruling that Multichain had breached contractual obligations.

In May 2025, the same court granted a liquidation order against Multichain Foundation Ltd., appointing KPMG’s Bob Yap Cheng Ghee, Toh Ai Ling and Tan Yen Chiaw as joint administrators to oversee the recovery and winding up of assets.

The frozen $63 million in USDC represents a portion of the total $210 million stolen from Multichain. The liquidators are seeking to recover these assets as part of the wider liquidation process.

In their U.S. filing, they described the New York court’s preliminary injunction as “an effective mechanism to implement Chapter 15’s policy of promoting cooperation between United States courts and foreign courts involved in cross-border restructuring cases.”

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