Singapore Crypto Platform Hodlnaut Suspends Withdrawals
2022.08.08 22:38
By Geoffrey Smith
Investing.com — Hodlnaut, a Singapore-based lending cryptocurrency lending platform, said on Monday it has suspended all withdrawals, swaps, and transfers, citing “recent market conditions”.
The platform, whose LinkedIn page claims $500 million in assets under management, is the latest in a lengthening line of crypto asset managers to have been caught out by the sharp drop in Bitcoin and alt-coins this year as central banks around the world have raised interest rates.
However, the announcement is notable for the fact that it comes several weeks after the rout in underlying asset values appeared to have ended, suggesting that the shake-out that started with the collapse of the Luna/Terra network and also brought down Three Arrows Capital, Voyager Digital (TSX:VOYG), and the Celsius Network is still reverberating through the system. With a relative lack of clear precedent, it is only gradually becoming clear whose claims on the collapsed platforms will be honored.
Last week, Zipmex – another Singapore-based crypto company – filed for bankruptcy protection due to losses on its exposure to Celsius and Babel Finance (another lender that has halted withdrawals).
Bitcoin rose above $24,000 on Monday to trade nearly 30% from its June low.
In a statement, the company said that “this difficult decision was taken for us to focus on stabilizing our liquidity and preserving assets, while we work to find the best way to protect our users’ long-term interests.”
The company also said that it intends to withdraw its application to the Monetary Authority of Singapore for an operating license.
“Hodlnaut is therefore no longer providing regulated digital payment token (DPT) services, i.e. our token swap feature,” it said, adding that it will also cease all borrowing and lending services.
The company has retained law firm Damodara Ong LLC as advisors on a recovery plan and promised an update “as soon as permissible”.
