Cryptocurrency Platform Hodlnaut Faces Liquidation After Massive Losses
The High Court has officially initiated the dissolution process for Hodlnaut, a cryptocurrency lending platform headquartered in Singapore.
The appointment of joint liquidators, Aaron Loh Cheng Lee and Ee Meng Yen Angela from EY, marks a significant development following their interim managerial role in August. This interim responsibility was assumed to oversee Hodlnaut’s affairs after it suffered substantial losses, totaling around $190 million, attributed to investments in the faltering Terra ecosystem.
An investigative report suggests that Hodlnaut’s directors are under scrutiny for purportedly withholding information regarding their ties to the Terra/Luna platform, both before and after its collapse in May 2022.
This places Hodlnaut in a category alongside other financial institutions, including Celsius, Voyager Digital, and Three Arrows Capital, all grappling with repercussions stemming from their involvement with Terra’s algorithmic stablecoin, UST.
The recent court decree, dated November 10, mandates the liquidation of Hodlnaut, raising uncertainties among the platform’s 17,000-plus users about the fate of their funds. Hodlnaut, previously recognized for offering interest rates as high as 12.73% on deposits, had already suspended customer withdrawals back in July 2022.
In light of the considerable number of creditors involved, the appointed liquidators are exploring the feasibility of delivering comprehensive updates collectively online, acknowledging the impracticality of addressing each individual separately.