- Crypto lender Hodlnaut faces investigation from Singapore authorities.
- The probe is on based on grounds of conjectured fraud.
- Hodlnaut had halted withdrawals in August citing harsh market conditions.
Financially troubled crypto lending firm Hodlnaut is facing scrutiny from Singapore authorities. As per the details from Bloomberg, the crypto lender is facing a probe for possible fraud. The Singapore Police Force has opened an investigation into the company and its directors for possible cheating and fraud.
The investigation is reportedly a follow-up of numerous reports claiming “false representations relating to the company’s exposure to a certain digital token.” The revelation was made by the Singapore police in their statement.
Noticeably, the Singapore-based cryptocurrency lending company cited market conditions when it suspended withdrawals and deposits in August. Following that, the business requested creditor protection, which the Singapore High Court approved a few days later.
Hodlnaut then made another revelation that it lost almost $190 million following the fall of Do Kwon’s Terra empire. The company additionally disclosed a financial shortfall of millions of dollars. The crypto lender had an outstanding liability of around $281 million, according to an affidavit that was filed.
The situations of several firms in the cryptocurrency market are worsening day by day. Just when everyone thought that it all ended with the fall of Terra, users were unaware of the biggest storm that was set to hit them. The fall of FTX also created shockwaves in the industry. The ripples greatly affected other firms associated with it.
Ever since the FTX incident, regulators across the globe have been trying to tighten the rope around cryptocurrencies. Singapore was no stranger and had deployed efforts to protect investors from a similar catastrophe.