Crypto Lender Hodlnaut Under Investigation by Singapore Authorities

Singapore Authorities Investigate Hodlnaut

Hodlnaut, a cryptocurrency lending firm, is under investigation by Singapore authorities for suspected fraud. The probe, initiated by the Singapore Police Force, focuses on potential cheating and fraud by the company and its directors. This investigation follows reports of possible false representations concerning the company's exposure to specific digital tokens.

Suspension of Operations

In August, Hodlnaut suspended withdrawals and deposits, attributing the decision to adverse market conditions. Subsequently, the firm sought creditor protection, which the Singapore High Court granted. This move aimed to stabilize the company's precarious financial situation.

Financial Losses and Liabilities

The company revealed a significant financial loss of nearly $190 million, linked to the collapse of Do Kwon’s Terra empire. Additionally, Hodlnaut disclosed a financial shortfall, with outstanding liabilities amounting to approximately $281 million, as documented in a filed affidavit.

Worsening Crypto Market Conditions

The cryptocurrency market continues to face challenges, with numerous firms experiencing financial difficulties. The collapse of Terra was a significant event, but the subsequent fall of FTX exacerbated the situation, affecting many associated companies and creating widespread uncertainty.

Regulatory Response

In response to these crises, global regulators are intensifying efforts to safeguard investors and stabilize the crypto market. Singapore is actively working to implement protective measures to prevent similar financial disruptions in the future.