Crypto lending platform Hodlnaut suspends services due to liquidity crisis
Singapore-based crypto lending platform Hodlnaut has become the latest firm to suspend withdrawals, and deposits blaming market conditions and lack of liquidity.
The crypto lending firm made an official announcement on Aug. 8, claiming that market conditions have forced it to suspend its services and that it is actively working on recovery plans.
Dear users, we regret to inform you that we will be halting withdrawals, token swaps and deposits immediately due to recent market conditions. We have also withdrawn our MAS licence application. Here is our full statement https://t.co/5KfHUBzWsn Our next update will be on 19 Aug.
Hodlnaut also stated that it has withdrawn its regulatory license application in Singapore and as a result, it would no longer be able to offer any token swaps features. The official announcement read:
The crypto lending platform said it would suspend all of its social media accounts except for the official Twitter and Telegram. Apart from the social media suspensions, founder Juntao Zhu has gone private on Twitter.
The crypto lending crisis began with the Terra ecosystem collapse followed by the bankruptcy of leading crypto hedge fund Three Arrow Capital (3AC). The back-to-back market turmoil created a domino effect for crypto lenders with exposure to the hedge fund as well as the Terra ecosystem. Voyager Digital, Celsius and Blockchain.com were some major crypto lenders that suspended their services.
Hodlnaut managed to avoid any 3AC exposure, but some reports have claimed that the firm was not transparent regarding its investments in Terra's now defunct algorithmic stablecoin. A report published by Twitter handle Fatman in June pointed toward the large exposure of Hodlnaut during the stablecoin’s depeg
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