SpiritSwap, a decentralized exchange built on Fantom, informed users that it would be shutting down the protocol due to a lack of treasury funds to support its operations.
“The unfortunate Multichain hack has left our treasury drained, and without the means to finance essential aspects of our operation – from regular development costs to operational salaries, from monthly costs to marketing,” said the SpiritSwap team in a Discord message to its community.
They're looking for a team to hand things to; otherwise operations will cease on September 1; a guide to help users withdraw $SPIRIT dregs as they unlock will be developed 🪦 pic.twitter.com/Syu2wqNlAY
— The Fantom Ecologist 👻🌿 (@ftm_ecologist) August 9, 2023
SpiritSwap is one of the many Fantom-based protocols that have been dealt a devastating blow by the alleged exploit of cross-chain platform Multichain. Last month, more than $100 million worth of crypto was withdrawn from Multichain’s Fantom bridge contract on Ethereum.
Shortly after the incident, Geist Finance, a lending protocol that uses Fantom’s smart contracts, confirmed plans to shut down permanently owing to the Multichain situation.
“We are exploring all options at this point, working with relevant organizations to try and recover assets. Beyond that also looking into other backstops or helping recovery, even using foundation treasury,” wrote Fantom founder Andre Cronje on the protocol’s governance forum.
SpiritSwap, however, appears optimistic about the continued existence of the protocol and is on the lookout for a new team to take over its management.
“Unless we can find a team, the winding down process will happen automatically,” the SpiritSwap team noted, adding that operations would continue until Sept. 1 so that users have enough time to safely remove their liquidity.
SpiritSwap was once one of the most used DEXes on Fantom, and boasted a peak of $373 million in Total Value Locked (TVL) in January 2022. At the time of writing, TVL on the protocol stands at around $2.83 million.