Crypto: Hodlnaut notes ~$200M Financial Shortfall

Sahana Kiran
Source – Unsplash

The crypto-verse has been witnessing the downfall of an array of projects over the last couple of months. Several crypto lenders were seen abruptly shutting down withdrawals and blaming market conditions for the same. Hodlnaut went on to follow a similar path. In addition to this, the firm went on to file for creditor protection as well. Amidst all of this, it was brought to light that the firm reported a whopping $193 million financial shortfall.

As per an affidavit that was previously filed, Hodlnaut entailed an outstanding liability of about $281 million [SGD 391 million]. This was further compared with assets of $88 million [SGD 122 million]. Thanks to this, the firm endured a shortfall of about $193 million.

The affidavit further read,

“As of 8 August 2022, the Hodlnaut Group has an outstanding liability balance of SGD 391M and estimated realizable assets of SGD 122M in cryptocurrency. This financial position gives the Hodlnaut Group a realizable cryptocurrency Asset to Debt ratio of about 0.31 [ie. 31 cents on the dollar].”

It should be noted that the firm heavily invested in Terra and its assets. The filing shed light on the fact that Hodlnaut had $317 million invested in TerraUSD [UST] as well as Anchor Protocol on Terra. Following the dramatic downfall of the project, the firm incurred a loss of $189.7 million.

Singapore has its hands full: Stricter crypto laws are sure to emerge

Governments across the globe have been swiftly working to govern the crypto industry. Singapore, however, seemed to be dealing with the collapse of an array of crypto lending firms. Over the last couple of months alone, several firms including Vauld and Zipmex took their million-dollar woes to the Singapore government.

Hodlnaut joined the list earlier this month. More recently, the firm revealed that it was under the purview of Singapore law enforcement. In addition to this, the firm went on to let go of 80 percent of its staff.

With Singapore regulators having to deal with several platforms at the moment, Hodlnaut’s case is likely to take some time to progress. Nevertheless, an update awaits the community tomorrow.