Hodlnaut, a Singapore-based crypto lending venue, has become the new platform to halt deposits and withdrawals, with the company citing a lack of liquidity and the current state of the cryptocurrency market as justification. On August 8th, the crypto lending forum issued a public statement saying that market conditions had forced the venue to cease operations while it dynamically operated on some recovery strategy.
Hodlnaut Cancels Account Funds Withdrawal Services
Hodlnaut further noted that the company has withdrawn its application for a regulatory license in Singapore and will, therefore, be unable to offer any services involving token exchanges. The public announcement highlighted the fact that they are coordinating with Damodara Ong to determine whether or not their plans are feasible, how long it would take to put them into action, and how they will structure the recovery plan with the interests of consumers in mind.
With the exception of Telegram and Twitter, the cryptocurrency lending institution announced it will be suspending all of its social media accounts. Following the failure of the Terra ecosystem, well-known crypto hedge firm Three Arrows Capital declared bankruptcy, setting off a chain of events that led to the current crypto loan calamity. The Terra ecosystem and the hedge fund both had exposure to crypto lending institutions, which were negatively impacted by a prolonged market downturn.
After the collapse of Terra, the number of crypto platforms continues to decline.
Some significant cryptocurrency lending platforms, including Blockchain.com, Celsius, and Voyager Digital, have discontinued their operations. Hodlnaut has so far been successful in avoiding exposure to 3AC; nonetheless, a number of stories have claimed that the platform did not give accurate information regarding the investments it made in Terra’s algorithmic stablecoin (that is now defunct).
During the depeg of the stablecoin in June, a Twitter user going by the moniker “Fatman” released a report that highlighted Hodlnaut’s significant exposure. Zhu denied these assertions and said the corporation had not bought UST and hadn’t lost money because of UST yield services, but he offered no proof.
In response to Hodlnaut’s apparent collapse, the community has been critical, with some members advising investors to move their cryptocurrency holdings off-exchange. The remainder of the group hypothesized that the UST crash in May had set off a chain reaction that was responsible for the current difficulties.