Crypto lender Hodlnaut has announced that it has filed for protection from creditors in Singapore in an effort to solve its liquidity problems. According to the announcement, Hodlnaut filed for filing with the Singapore Supreme Court on Aug. 13, just days after the company halted recordings from its platform, to be placed under judicial control. The latest application filed by the company will temporarily protect it from any legal claims and proceedings against it by creditors. Hodlnaut also revealed that it is currently working with lawyers to avoid being forced to liquidate its assets at the current lower price.
“We aim to avoid a forced liquidation of our assets as it is a sub-optimal solution requiring us to sell our users’ cryptocurrencies such as BTC, ETH and WBTC at these current low asset prices,” the announcement said.
“This pause will give us breathing room to focus our efforts on the recovery plan to rehabilitate the company,” the statement added.
The Supreme Court of Singapore will appoint a judicial manager who will be an independent officer of the court to lead the company as part of the judicial management process.
However, the company has applied for the appointment of a former Deloitte Southeast Asia partner and current Kairos Corporate Advisory director, Chee Chong Tam, to take on the role of judicial manager. Chong Tam is also the company’s option for the interim judicial manager, while the Singapore courts are reviewing the company’s application.
Hodlnaut is expected to release its next update on August 19 and hopes its final move will give it some time to put together a recovery plan to avoid liquidating customer assets.
The Singapore-based company is the latest on an already long list of crypto firms that have faced financial difficulties this year as a result of the recent market decline. Celsius, Voyager and BlockFi are other companies that have been stung by the recent market crash.
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