Crypto lender Hodlnaut halts withdrawals, cites market downtrend

Key Takeaways:

  • Law firm Damodara Ong is working with Hodlnaut on a recovery plan.
  • Hodlnaut is scheduled to give more updates on August 19.
  • Hodlnaut has opted out of its application to be regulated in Singapore.
Hodlnaut has halted withdrawals on its platform.
Hodlnaut has halted withdrawals on its platform.

LAGOS (CoinChapter.com) — In another unfortunate development for cryptocurrency investors, Hodlnaut, a digital currency lender, has announced the suspension of withdrawals, swaps, and deposits on its platform.

Hodlnaut, Crypto lender Hodlnaut halts withdrawals, cites market downtrend

In detail, the Singapore-based crypto lending firm explained that the halt in withdrawal was due to the recent downtrend experienced across the crypto industry.

Hodlnaut, in its statement, disclosed that the decision was taken to stabilize liquidity and preserve assets in its custody. In addition, it explained that the pause would enable it to find a solution to the current crypto price collapse in the industry.

“To all users, we regret to inform you that we will be halting withdrawals, token swaps and deposits with immediate effect. We have reached this difficult decision due to recent market conditions.”

Hodlnaut said.

Additionally, the firm disclosed that it is consulting with Singapore-based law firm Damodara Ong to find a solution to preserve user assets. According to Hodlnaut’s LinkedIn page, the firm currently has more than $500 million in assets under management.

Moreover, the crypto lender also noted that it would provide an update on the current situation on August 19. However, for now, it plans to continue paying interest to customers to minimize liabilities.

Hodlnaut Opts Out Of MAS

Meanwhile, Hodlnaut has also withdrawn its license application to the Monetary Authority of Singapore (MAS). It halted the license application after receiving in-principle approval from the central bank in March.

It said:

“We would also like to inform our users that, […] Hodlnaut is therefore no longer providing regulated digital payment token (DPT) services, ie our token swap feature.”

Notably, cryptocurrency firms in Singapore are required to register with the MAS before operating or offering services in the country.

Additionally, Hodlnaut is the latest crypto firm to run into difficulties following the downtrend that started in May. Recall that U.S. crypto lender Celsius, and Singapore-based fund Three Arrows Capital, recently filed for bankruptcy.

Moreover, Vauld, a Singapore-based crypto lending, and trading firm, recently suspended withdrawals due to unfavorable market conditions. Similarly, last month Zipmex, a Southeast Asia-focused crypto exchange, suspended withdrawals, though it has since resumed them for some products.

Hodlnaut

It is also worth noting that Hodlnaut was named as one of Celsius’ institutional clients, according to court filings. However, the firm has since debunked the claim saying it has no exposure or loans with Three Arrows Capital or Celsius.

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Hodlnaut, Crypto lender Hodlnaut halts withdrawals, cites market downtrend

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