Following on from Celsius, Voyager, BlockFi and others, Hodlnaut is the latest crypto lending platform to halt withdrawals, token swaps and deposits, citing difficult market conditions.
The ongoing liquidity crisis has spread to crypto lender Hodlnaut. The company put out a message to all users on its website. The main reason given was difficult market conditions and an effort to stabilise liquidity.
“We understand that this is disappointing news and understand its impact on you. We would like to reassure you that this difficult decision was taken for us to focus on stabilising our liquidity and preserving assets, while we work to find the best way to protect our users’ long-term interests.”
The process being followed by Hodlnaut is very much akin to that followed by other distressed crypto lenders in a similar situation. In addition to the actions taken, Hodlnaut has also informed its users that it has withdrawn its licence application with the Monetary Authority of Singapore (MAS), which entails the withdrawal of its token swap feature.
While stating that it will continue to pay interest to users until further notice, the platform has also said that it has turned off its social media platforms except for the odd official channel. Its YouTube channel has been deleted, and the personal Twitter account of founder Juntao Zhu has been set to private.
In addition, the team page on the Hodlnaut website, which formerly had both founders, five team members, and an advisor, has also been removed.
The message to users does say that a recovery plan is being worked on and that an update on this will come out as soon as possible.
“We are actively working on the recovery plan that we hope to provide updates and details on as soon as permissible. We are consulting with Damodara Ong LLC on the feasibility and timelines of our intended execution plan and are strategising our recovery plan with our users’ best interests in mind.”
The message to users contained a FAQ which stated that potential restructuring options were being explored with the Hodlnaut legal advisors, and that an update would be posted on Friday, 19 August 2022.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice
