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Hodlnaut Faces Investigation From Singapore Authorities for Potential Fraud

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Crypto lender Hodlnaut is in for more trouble. The troubled cryptocurrency lender is now facing additional legal difficulties as Singapore’s police force announced that it is looking into Hodlnaut Pte and its directors for possible cheating and fraud offenses.

The investigation was started on Wednesday as a result of numerous reports alleging “false representations relating to the company’s exposure to a particular digital token,” according to a statement from the police.

The police received numerous reports between August and November of this year claiming that Hodlnaut or its directors had misrepresented the company’s exposure to a particular digital token.

The cryptocurrency lender is the subject of an investigation by the Commercial Affairs Department into alleged offenses.

“If you have deposited digital tokens with Hodlnaut and believe that you may have been defrauded through, among others, false representations made by Hodlnaut, you may wish to lodge a police report at the nearest Neighbourhood Police Centre, or online,” stated the police.

Hodlnaut halted withdrawals in August

The crypto lender stopped withdrawals in August and was given protection from creditors. Its interim judicial managers, who were appointed by the court, declined to comment.

The company is one of several crypto lenders who have been adversely affected by the near-70% decline in token prices over the past year and the failure of the TerraUSD stablecoin project. There are “pending proceedings” with the police, according to prior statements by the crypto lender.

According to a report by interim judicial managers published last month, the company had minimized its exposure to the defunct Terra digital-token ecosystem. Yet the wipeout caused a loss of almost $190 million for it.

Prior to their appointment, about 25% of Hodlnaut’s assets were being used on centralized exchanges, according to a Nov. 11 circular from EY, Hodlnaut’s interim judicial managers.

Nearly 71.8% of the digital assets that Hodlnaut had used on centralized exchanges were held by FTX, with a market value of about S$18.47 million.

The interim judicial managers repeatedly tried to withdraw the assets from FTX prior to the announcement of FTX’s demise but were unsuccessful. Singapore has tightened regulations for retail cryptocurrency investment to protect people from the dangers of a volatile market.

Crypto lender Hodlnaut deals with major layoffs along with police proceedings

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In a blog post published on Friday, Singaporean crypto lender Hodlnaut revealed significant layoffs and ongoing “police proceedings,” underscoring the precarious financial and legal predicament of the most recent company to suspend cryptocurrency withdrawals.

Hodlnaut said in the blog that in an effort to “stabilize our liquidity” and reduce costs, it let go 40 employees (or 80% of the workforce) and lowered interest rates to 0% APR. The company’s founders are still in Singapore and are “working hard on a recovery strategy.”

The cryptocurrency swap shop that pays interest claimed to be in “proceedings” with Singaporean authorities. Its blog kept quiet about the specifics but stated that the actions were taken to benefit users. Early in August, Hodlnaut froze the assets of those users; it is now looking for protection from its creditors.

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Source: Blog Post

Hodlnaut also withdrew its request for a licence from the Monetary Authority of Singapore, despite the fact that the central bank had given it in-principle approval in March.
The organization is the most recent in a long line of cryptocurrency lenders to falter this year due to market pressure, with Celsius Network and Voyager Digital both seeking bankruptcy protection. From more than $3 trillion in November, the total market valuation of cryptocurrencies has fallen to a little over $1 trillion today.

Along with Three Arrows Capital, Voyager Digital, and Celsius Network, Hodlnaut is one of the numerous cryptocurrency businesses that have failed due to depreciating market circumstances and collapsing businesses. Hodlnaut blamed “losses experienced” from the crash of TerraUSD in the blog post.

Hodlnaut seeks the appointment of a judicial manager

The Singapore High Court has received a request from the cryptocurrency lending platform to be placed under judicial management, which offers protection from creditors.
The application was submitted on August 13, 2022, five days after the corporation froze withdrawals, per a notice on Hodlnaut’s website. The application will provide the lender with a temporary barrier against any legal claims.

On August 22, 2022, the Singapore high court will hear the crypto lender’s request for legal protection. The company’s current directors may be replaced by an interim judicial manager who will be in charge of managing the company’s finances.

Hodlnaut increases Bitcoin interest rate to 7.5% APY; 2021 roadmap packed with updates with iOS App launch and token swap feature

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The cryptocurrency market’s rate of growth has required companies to keep up in terms of updates and developments. Singapore-based Hodlnaut managed to keep up with the pace and made a name for itself by releasing sought-after features that align with customer interests. Hodlnaut’s competitive interest rates make it stand out from the rest of the cryptocurrency lending platform, asserting its presence in the digital asset ecosystem.

The Singapore Fintech Association has certified Hodlnaut as a Fintech company, and this credential is recognized by the Monetary Authority of Singapore. Hodlnaut customers are asked to complete a Know-Your-Customer (KYC) process before they are allowed to deposit crypto to maintain the highest standards of user safety.

Priding itself on its convenience, Hodlnaut pays out the earned interest directly to the users’ wallets every Monday. Users can choose their payout in the preferred cryptocurrency of their choice. For those tired of contract-based partnerships, Hodlnaut is ideal as there is an absence of a lock-in period. The platform’s stellar interest rates make Hodlnaut a customer favorite amongst cryptocurrency lending platforms.

Hodlnaut’s annual compounded interest rates allow users to earn up to 12.73% APY in interest. Bitcoin (BTC) and Ethereum (ETH) hodlers can earn up to 7.46% interest while the interest rate shoots up even more for stablecoins. Holders of USD Coin (USDC) and Tether (USDT) have the option to earn up to 12.73%.

Hodlnaut Banner MediaKit 1
Hodlnaut increases Bitcoin interest rate to 7.5% APY; 2021 roadmap packed with updates with iOS App launch and token swap feature 4

Their token swap service was launched in early 2021. This feature allows Hodlnaut users to swap between supported asset pairs which include BTC, ETH, WBTC, DAI, USDC, and USDT. Users can make use of this feature and directly manage their trading pairs without a two-step process and additional trading fees.

Just recently, Hodlnaut welcomed the launch of its iOS application. Users are able to deposit, withdraw and check interest statements in the palm of their hands. The company also plans to launch the Android application by the end of 2021.

Hodlnaut Rates August2021
Hodlnaut increases Bitcoin interest rate to 7.5% APY; 2021 roadmap packed with updates with iOS App launch and token swap feature 5

“Our much-awaited iOS App will enable fast and transparent transactions while giving users the required information at their fingertips, enhancing the user experience of our platform,” said Juntao, CEO and Co-Founder of Hodlnaut. 

Hodlnaut’s iOS App is built by developers dedicated to providing the best application experience to its valued users. Download Hodlnaut’s iOS Application via Apple AppStore.