Hodlnaut Facing Liquidation
Hodlnaut, a Singapore-based crypto lending firm, is set to be liquidated by its judicial managers, as per a document published by auditing firm EY. This move comes after the judicial managers filed a winding-up order against Hodlnaut on Nov. 10. The firm had attempted to avoid liquidation but faced resistance from creditors.
Financial Losses and Salvage Attempt
Hodlnaut held over $13 million in assets in the now bankrupt FTX exchange and suffered a loss of $189.7 million in the Anchor Protocol, a failed DeFi platform for the Terra stablecoin UST. Last August, Hodlnaut informed its 17,000 users about halting withdrawals and pulling its license application with the Monetary Authority of Singapore. The company also applied for judicial management to prevent forced liquidation.
The company laid off 80% of its staff and disclosed a pending investigation by the Singapore police due to “false representations relating to the company’s exposure to a certain digital token.” However, creditors rejected the restructuring plan in January, expressing preference for liquidation to maximize remaining assets for distribution.
Hot Take: Hodlnaut’s Troubles Continue
Hodlnaut’s journey has come to an end with the decision for liquidation following significant financial losses and failed attempts at restructuring. This turn of events highlights the challenges faced by crypto firms in navigating regulatory compliance and financial stability, impacting not only their operations but also their users and stakeholders.
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