Crypto Lender Hodlnaut Seeks Creditor Protection in Singapore
Hodlnaut Facing Recent Market Collapse Impacts
Hodlnaut is the most current in a long line of cryptocurrency businesses to face the consequences of the recent market collapse. On Monday, Singapore-based exchange Zipmex received creditor protection. In addition, Three Arrows Capital, which collapsed in June due to leverage, owes creditors billions of dollars. Hodlnaut anticipates that being placed under judicial administration will provide it the opportunity to develop a recovery strategy rather than selling off customer assets. The statement reads,
"We are aiming to avoid a forced liquidation of our assets as it is a suboptimal solution that will require us to sell our users' cryptocurrencies at these current depressed asset prices,"
Hodlnaut To Provide Another Update
Hodlnaut expects the entire process to take "a few months," and on August 19, the crypto firm will provide another update. Singaporean law defines judicial management as a method for businesses in financial difficulty to get back on their feet. If approved, it would give Hodlnaut's legal claims and actions a temporary halt. The decision came following several cryptocurrency-related bankruptcies, including those of the lender Celsius Network and hedge fund Three Arrows Capital.
Along with Hodlnaut, the exchange Zipmex and the brokerage Voyager Digital had also sought bankruptcy protection. Since then, Zipmex has received a three-month extension from the High Court of its moratorium protecting Zipmex Asia and its significant operating subsidiaries from future creditor claims.