Hodlnaut heading for liquidation after failure of restructuring, sale efforts
Crypto lender Hodlnaut’s days appear to be numbered after the High Court of Singapore ended judicial management and ordered its liquidation. Users’ funds have been frozen since August 2022.
Former Hodlnaut interim judicial manager (IJM) Aaron Loh Cheng Lee announced in a letter dated Nov. 10 and posted on the website of EY that he and fellow IJM Ee Meng Yen Angela have been discharged from that position and appointed liquidators.
The liquidation decision was made by the Singapore court in a Winding-up Order in response to their application. According to an attachment to Lee’s letter, that decision is sealed at the moment.
Singapore-based Hodlnaut suspended deposits and withdrawals and simultaneously withdrew its licensing application before the Monetary Authority of Singapore on August 8, 2022. The company attributed its decision to “recent market conditions.” According to Lee’s letter, Hodlnaut’s creditors include 17,000 users. Major creditors included Samtrade Custodian, S.A.M. Fintech and the Algorand Foundation.
Related: Algorand Foundation outlines $35M exposure to crypto lender Hodlnaut
Hodlnaut was apparently a victim of the systemic turmoil that struck the industry with the collapse of the Terra ecosystem and Three Arrows Capital (3AC). It did not have exposure to 3AC, but reportedly held around $150 million in Terra stablecoin, since renamed TerraUSD Classic (USTC), at some time. It later took another financial hit with the collapse of FTX.
The value of FLEX token — the proposed settlement digital currency for Hodlnaut’s $30 million buyout — has plummeted 90% since the offer was made in early August. https://t.co/PDgFgiKp4P
Hodlnaut avoided forced liquidation by applying for and receiving court-appointed IJMs.
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