Singapore-based crypto lending agency Hodlnaut was positioned beneath interim judicial administration, a type of creditor safety program, by the Singapore court docket on Monday.
The court docket orders got here three weeks after Hodlnaut froze all buying and selling actions and withdrawals on its platform citing a liquidity disaster. In an official weblog publish on Aug. 30, the crypto lending platform notified its customers that Ee Meng Yen Angela and Aaron Loh Cheng Lee, care of EY Company Advisors, had been appointed as interim judicial managers. The weblog publish learn:
“The Court docket has delivered judgment on 29 August 2022, and has been confirmed that Hodlnaut can be positioned beneath Interim Judicial Administration.”
The crypto lender sought judicial administration to keep away from compelled liquidations within the bear market. The stated creditor safety program beneath Singapore legislation permits financially troubled companies to rehabilitate themselves. Beneath this legislation, the court docket appoints an officer referred to as the judicial supervisor who takes over the cost from the corporate’s director in the intervening time.
As Cointelegraph reported earlier this month, Hodlnaut lower 80% of its workforce earlier than making use of for judicial administration. The agency hopes to make the most of the judicial administration interval to revive its asset-to-debt ratio to 1:1 to permit customers the power to withdraw their preliminary cryptocurrency deposits.
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The crypto lender knowledgeable earlier that they had been exploring the choice to permit customers to withdraw their preliminary deposits with curiosity accrued in full earlier than closing their accounts, which is now topic to the approval by newly appointed judicial managers
Hodlnaut is one amongst many crypto lending companies that fell prey to the crypto contagion brought on by the downfall of the now-defunct TerraUSD Basic (USTC) algorithmic stablecoin. The implosion of USTC led to the downfall of a $40 billion Terra ecosystem, and plenty of crypto lending companies with publicity to USTC fell finally.