Case Details
- Citation: [2024] SGHC 173
- Title: Fantom Foundation Ltd v Multichain Foundation Ltd and another
- Court: High Court of the Republic of Singapore (General Division)
- Originating Claim No: 621 of 2023
- Assessment of Damages No: Assessment of Damages No 2 of 2024
- Date of Judgment: 8 July 2024
- Judge: Mohamed Faizal JC
- Hearing/Reservation: Judgment reserved; heard on 3 June 2024
- Plaintiff/Applicant: Fantom Foundation Ltd
- Defendants/Respondents: (1) Multichain Foundation Ltd; (2) Multichain Pte Ltd
- Legal Area: Damages — Assessment
- Statutes Referenced: Evidence Act; Evidence Act 1893; Sale of Goods Act
- Cases Cited: [2023] SGHC 323; [2024] SGHC 173
- Procedural Posture: Assessment of damages following a default judgment obtained on 30 January 2024
- Key Remedies in Default Judgment: Damages to be assessed; delivery of 4.175m FTM or, alternatively, the value of the FTM
- Judgment Length: 30 pages; 8,888 words
Summary
This decision concerns the assessment of damages arising from a default judgment obtained by Fantom Foundation Ltd (“Fantom”) against Multichain Foundation Ltd (“Multichain Foundation”) and Multichain Pte Ltd (“Multichain Pte”). While the liability aspects were determined by the earlier default judgment, the High Court was required to quantify the Claimant’s monetary entitlement. The case is notable for its focus on the valuation of cryptocurrency—particularly the valuation of Fantom’s native token (FTM) and the evidential and methodological challenges that arise when market prices are volatile.
After hearing the Claimant in the assessment proceedings (the Defendants did not participate), Mohamed Faizal JC awarded Fantom (i) US$58,620.55 in relation to the “damages claim” and (ii) US$2,129,250 in relation to the “FTM claim”, being the alternative value of 4.175 million FTM. The court’s reasoning emphasised the need to select an appropriate valuation “point in time” and to apply a coherent approach to market value in a context where cryptocurrencies do not behave like traditional commodities or fiat currency.
What Were the Facts of This Case?
Fantom is an exempted foundation company incorporated in the Cayman Islands. It developed and operates “Fantom Opera Chain”, an open-source smart contract platform. Fantom’s native cryptocurrency is FTM, which functions as a utility token within its ecosystem: it can be used to pay transaction fees, participate in governance, and be “staked” to secure the network. Like many cryptocurrencies, FTM’s financial value is not backed by a central reserve and can fluctuate significantly based on market forces.
The dispute centres on Fantom’s relationship with Multichain Foundation and Multichain Pte, which operate a cross-chain bridge and router protocol known as the “Multichain Bridge”. The bridge facilitates interoperability between blockchain networks by locking “source assets” on one chain and releasing wrapped tokens on another chain. In simplified terms, the mechanism operates like an IOU system: the user deposits collateral (source assets) and receives wrapped assets of equivalent value on a different network, which can then be traded more freely due to improved liquidity.
Fantom’s damages arise from the loss of cryptocurrency assets allegedly deposited into the Multichain Bridge pursuant to three agreements. Two agreements were written: (1) an “Integration Agreement” for integrating Fantom’s blockchain with Multichain’s platform, and (2) a “User Agreement” setting the terms for use of the bridge. The third agreement was said to be inferred from a course of conduct. The Integration Agreement permitted integration of multiple cryptocurrencies, including stablecoins (USDC, USDT, DAI) and wrapped tokens (WEth and WBTC). The User Agreement, as asserted by Fantom, contained key conditions relating to decentralised control via multi-party computation (MPC) nodes, the holding of source assets as collateral on a 1:1 basis in a “decentralised management account”, and the entitlement of a bearer presenting a validly encrypted wrapped asset to unwrap and collect the underlying source asset.
As of 6 July 2023, Fantom had deposited source assets into the Multichain Bridge to mint wrapped assets on the other side. Those deposits were said to have an equivalent value of about US$61,829.70, comprising USDT (US$9,991.40), USDC (US$28.80), and DAI (US$51,809.50). Fantom also described a “liquidity facility” arrangement in which it provided liquidity to Multichain Foundation in tranches upon request. The assessment judgment, however, focuses on quantifying the losses that flowed from the default judgment and the court’s task of converting cryptocurrency entitlements into monetary damages.
What Were the Key Legal Issues?
The principal issue was the assessment of damages following a default judgment. In such proceedings, the court must quantify the claimant’s loss on the basis of the evidence adduced by the claimant, while bearing in mind that the defendants have not contested the factual assertions. Here, the court had to determine the monetary value of two distinct heads of relief: (a) the “damages claim” (a cash sum) and (b) the “FTM claim”, which was framed in the alternative as delivery of 4.175 million FTM or, if delivery was not ordered or not feasible, payment of the value of that FTM.
A second, more technically challenging issue concerned valuation methodology. Cryptocurrency markets are inherently volatile, and prices can move sharply within short timeframes. The court therefore had to decide how to ascertain “market value” of cryptocurrency at a relevant point in time. This required the court to grapple with what constitutes the appropriate valuation date (or time) for damages purposes, particularly where the relevant entitlement is tied to a quantity of tokens rather than a fixed fiat amount.
How Did the Court Analyse the Issues?
Because the matter proceeded on the basis of a default judgment, the court’s analysis concentrated on quantification rather than liability. Mohamed Faizal JC explained that the Defendants did not participate, and therefore the facts were primarily those asserted by Fantom. The court nevertheless required a structured approach to damages assessment: it had to identify what sums were sought by Fantom and then determine whether those sums were supported by the evidence and by a legally coherent valuation approach.
On the “damages claim”, the court awarded US$58,620.55. While the truncated extract does not reproduce the full evidential chain, the court’s conclusion indicates that it accepted Fantom’s quantification for that head of loss. In assessment proceedings, the court typically expects claimants to provide documentary and/or expert evidence sufficient to establish the quantum, and to connect the claimed figures to the contractual or restitutionary framework that underpinned the default judgment. The court’s final award suggests that Fantom’s evidence was sufficiently persuasive for the court to quantify the cash damages without needing adversarial testing.
The more distinctive part of the judgment lies in the “FTM claim”. The default judgment ordered delivery of 4.175 million FTM or, alternatively, payment of the value of that FTM. The court therefore had to convert a token quantity into a monetary figure. The court recognised the “unique nature of cryptocurrency” and the “valuation conundrum”: unlike conventional assets with stable valuation conventions, cryptocurrencies trade on markets that can be fragmented across exchanges, subject to liquidity differences, and prone to rapid price swings. The court also noted that market movements could be significant around the time of the decision, which underscored the practical importance of selecting a valuation point that is legally defensible.
In addressing the “which point in time should one use to value cryptocurrencies?” question, the court’s reasoning (as reflected in the judgment’s structure) indicates that it considered the legal function of damages: damages aim to compensate for loss, not to create speculative windfalls or to expose claimants to arbitrary market timing. The court therefore had to choose a valuation time that aligned with the compensatory purpose of damages and with the temporal logic of the underlying default judgment. The court ultimately awarded US$2,129,250 for the alternative value of 4.175 million FTM, meaning that the court adopted a valuation approach that produced that figure based on the relevant market price at the selected time.
Although the extract provided does not include the detailed valuation calculations, the judgment’s headings show that the court analysed (i) the need to ascertain market value of cryptocurrency at a single point in time, and (ii) the legal question of which point in time should be used. This demonstrates that the court did not treat valuation as a purely mechanical exercise. Instead, it treated valuation as a legal determination guided by evidential principles and the compensatory objective of damages. The court’s approach also reflects an awareness of the evidential challenges in cryptocurrency disputes, including reliance on market data and the need to ensure that the evidence is admissible and reliable under the Evidence Act framework.
What Was the Outcome?
The High Court granted Fantom the sum of US$58,620.55 in relation to the damages claim and US$2,129,250 in relation to the FTM claim. These were the sums sought by Fantom in the assessment proceedings, and the court’s orders reflect acceptance of Fantom’s quantification methodology and evidential basis.
Practically, the outcome confirms that where a default judgment includes an alternative monetary remedy for cryptocurrency delivery, the court will assess the monetary equivalent by selecting an appropriate valuation point and applying a coherent market-value approach. The award also provides a concrete reference figure for the value of 4.175 million FTM as determined by the court for damages purposes.
Why Does This Case Matter?
Fantom Foundation Ltd v Multichain Foundation Ltd is significant because it offers judicial guidance on how Singapore courts may approach the assessment of damages involving cryptocurrencies. While the case arises from a default judgment, the court’s detailed engagement with valuation methodology indicates that even in uncontested proceedings, the court will not simply accept token-to-fiat conversions without a legally defensible framework. For practitioners, this highlights the importance of preparing valuation evidence carefully, including evidence of market prices and a clear explanation of why a particular valuation date/time is appropriate.
The decision also matters for its treatment of volatility and timing. Cryptocurrency markets can move rapidly, and a claimant’s damages can vary dramatically depending on the valuation date selected. By explicitly addressing the “valuation conundrum” and the question of which point in time should be used, the court implicitly signals that damages assessment should be anchored to compensatory logic rather than to opportunistic timing. This is likely to influence how future claimants frame their valuation evidence and how defendants (where they participate) may challenge valuation dates.
From a broader precedent perspective, the judgment contributes to the developing Singapore jurisprudence on crypto-related disputes. Even though the extract references that the decision attracted attention in the cryptocurrency world, the court’s emphasis on transparency and on the inherent challenges of cryptocurrency valuation suggests that the judgment is intended to be more than a one-off quantification exercise. It provides a structured analytical template—identifying the valuation task, recognising volatility, and selecting a legally relevant valuation point—that lawyers can adapt in subsequent damages assessments.
Legislation Referenced
- Evidence Act (Singapore)
- Evidence Act 1893 (as referenced in the judgment)
- Sale of Goods Act (as referenced in the judgment)
Cases Cited
- [2023] SGHC 323
- [2024] SGHC 173
Source Documents
This article analyses [2024] SGHC 173 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the full judgment for the Court's complete reasoning.