In a dramatic culmination to a turbulent period for Hodlnaut, the Singapore High Court has ordered the crypto lender’s liquidation, tasked with the daunting goal of reimbursing its 17,000 customers. The judicial decree follows Hodlnaut’s entanglement with the fallout of Terra’s decline and the company’s subsequent $193 million deficit.
Crypto Lender Hodlnaut Winds Up, Facing $193M Shortfall
The trouble for Hodlnaut surfaced after the crypto lender paused customer withdrawals in July 2022, blaming worsening market conditions for its plight. Not long after, the firm sought the court’s protection via judicial management, aiming to salvage its operations. Court filings revealed the extent of the financial abyss Hodlnaut faces, with a staggering shortfall of around $193 million, laying bare the vulnerability of crypto lenders to market volatility.
OPNX, whose founding ties to the infamous Three Arrows Capital (3AC) have cast a dubious shadow, proposed a takeover of Hodlnaut, offering $30 million in FLEX tokens. However, Hodlnaut’s interim judicial managers criticized the offer as inadequate, given the tokens’ illiquidity. Hodlnaut was ordered to wind up on November 10, 2023, by Judge Aedit Abdullah over its insolvency.
As liquidators take the helm, Hodlnaut faces the complex task of unwinding its operations. According to a circular from EY Corporate Advisors, the process will prioritize transparency and regular updates to creditors. “Responding to all creditor queries individually may not be practicable or economical,” Aaron Loh Cheng Lee, one of the appointed liquidators from EY said. “Liquidators will instead consolidate their answers to creditor queries within their updates to all potential creditors.”
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from Bitcoin News https://ift.tt/6wGdEXo
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