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The troubled cryptocurrency lender Hodlnaut has disclosed that it laid off most of its workforce and is currently under investigation by the police. The Singapore-based cryptocurrency company stated there are "pending procedures" between itself and the Singapore Attorney-General and Singapore Police Force in a blog post that was published this morning. https://twitter.com/hodlnautdotcom/status/1560455009455980545
Hodlnaut Halted Withdrawals
To give itself more time to address its financial problems, Hodlnaut halted withdrawals early this month and applied for creditor protection in Singapore. In the wake of the failure of Terra, the blockchain that supported the now-defunct stablecoin UST, and the cryptocurrency hedge fund Three Arrows Capital earlier this year, the startup is one of several crypto lenders with frozen customer funds. Along with the South Asian cryptocurrency exchange Zipmex, Vauld, also situated in Singapore, is constrained by the same issue. Holdnaut has asked for court supervision. According to today's blog post, if successful, the action will grant the judicial manager "final decision-making power on all elements of the organization moving forward."
"The company added, in our assessment, the current team that we have retained are the necessary headcount for us to carry out key functions,"
80% Employee Lay-Off
Hodlnaut has made significant cost-cutting efforts. Since pausing withdrawals, the business laid off 40 employees, or about 80% of its workforce, according to a blog post published today. The startup claimed that UST losses were the root cause of its financial problems. The crypto lender experienced a general drop in cryptocurrency prices from their peak in 2021 as a result of excessively high withdrawal volumes and encountered issues with specific users who had deposited large amounts of cryptocurrency.