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Crypto Lender Hodlnaut Under Investigation by Singaporean Authorities (Report)

Crypto Lender Hodlnaut Under Investigation by Singaporean Authorities (Report), Crypto Trading News
Law enforcement officials in Singapore have reportedly opened an investigation into ailing crypto lender Hodlnaut.

Police suspect the company’s executives may have scammed users and committed other crimes over the years.

Hodlnaut takes another punch

According to Bloomberg coverSingapore Police began investigating Hodlnaut for his alleged involvement in fraud and scams. This comes as a result of numerous reports accusing the company’s directors of “misrepresenting the company’s exposure to a particular digital token.”

“If you have deposited digital tokens with Hodlnaut and believe that you have been scammed, among other things, by providing false information from Hodlnaut, you may wish to file a police report at the nearest neighborhood police center or online,” police outlined.

The Singapore-based cryptocurrency lender stopped Withdrawals, deposits and token swaps in August citing “difficult market conditions”. It fire about 80% of its workforce and cut its interest rates almost a week after it stopped services.

Hodlnaut filed to be placed under judicial administration at the Singapore Supreme Court in hopes that it could “rehabilitate” his business and avoid compulsory liquidation of his assets:

“The Administration of Justice application provides for a moratorium (or temporary suspension) on legal claims and proceedings against Hodlnaut. This pause will give us the breathing space we need to focus our efforts on the recovery plan to turn the company around.”

Authorities approved the application and appointed Rajagopalan Seshadri, Paresh Jotangia and Ho May Kee as interim judicial managers at the firm.

Exposure to Terras UST

As CryptoPotato As recently reported, Hodlnaut was among the victims of the colossal Terra crash in May of this year. The company lost $190 million due to its exposure to algorithmic stablecoin VAT

“It appears that directors had downplayed the extent of the group’s exposure to Terra/Luna in both the period before and after the May 2022 Terra/Luna collapse.”

The crypto lender appears to have been hiding the facts from its users. Bloomberg data revealed that some employees at the company deleted over 1,000 “key” documents that could have shown the disclosure.

Terra’s native token – LUNA – and its stablecoin – UST – crashed to virtually zero, causing major panic among investors and distress across the market. Multiple sources revealed that some people had even committed suicide due to their millions of dollars in losses.

Source: Crypto News Deutsch

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