Hodlnaut Seeks Creditor Protection In Singapore
Cryptocurrency lender Hodlnaut recently halted production by filing an application in Singapore to place it under a form of creditor protection.
The move allowed for a temporary halt to the lawsuits and proceedings, allowing the company to focus on its recovery plans.
According to Hodlnaut, they will work with lawyers to stabilize his financial situation. He added that, despite being in a difficult financial situation, it is not necessary that all his assets are lost.
The Hodlnaut firm aims to avoid forced liquidation of assets, which would make it "suboptimal" i.e. not at the best level due to having to sell its clients' cryptocurrencies at a low price.
In addition, the company did not set a date for resuming production as well as how its research allows users to take advantage of emergency exit liquidity. However, the matter needs to be approved by various stakeholders.
Hodlnaut is the latest crypto company to suffer in the digital asset sector following a leveraged spike that erupted and wiped out US$40 billion of the Terraform Labs ecosystem and associated stablecoins.
Accordingly, Holdnaut has allowed investors to earn interest from their cryptocurrency by lending its tokens since 2019.
It is understood that the firm has more than US$100 million in client funds through more than 1,000 users.
