Hodlnaut co-founder and CEO Zhu Juntao / Photo credit: Hodlnaut
A Singaporean court is likely to decide whether to dissolve or restructure Hodlnaut at a hearing scheduled for August 7.
The Singapore-based crypto lender halted operations in August 2022 and has been under interim judicial management (IJM) since later the same month. The platform previously said it lost US$317 million in TerraLabs’ Anchor Protocol, a staking protocol based on the the Luna/TerraUSD algorithmic stablecoin pairing, which collapsed in May last year.
The IJM applied to end proceedings on April 25, indicating that Hodlnaut would be dissolved. They cited an unwillingness on the part of major creditors, including Samtrade Custodian and the Algorand Foundation, to negotiate further on a restructuring deal.
The court said 55.8% of Hodlnaut’s debtors preferred that the company be dissolved. The exchange currently faces about S$409 million (about US$304 million) in claims from creditors. The IJM also noted the absence of any “white knight” to rescue the company.
However, Simon Lee and Zhu Juntao, Hodlnaut’s founders, have confirmed to the court that they will be opposing the application to wind up the company.
Before the collapse of TerraLabs in May 2022, Hodlnaut had an estimated US$500 million in assets under management. After the collapse, questions arose about the latter’s exposure to the former’s Anchor Protocol. Hodlnaut denied it had any exposure as late as June last year.
The proceedings have been marked by numerous accusations on both sides, with the IJM accusing Hodlnaut’s management of hiding documents. Lee also asked the court to replace the company’s IJM, saying that they had been “unfairly prejudicial” in their handling of the case.
In November 2022, the Singapore police’s commercial affairs department announced that it had opened an investigation in Hodlnaut over claims of cheating and fraud.
See also: Hodlnaut assets hit by FTX debacle
Currency converted from Singapore dollar to US dollar: US$1 = S$1.34.
Editing by Miguel Cordon and Lorenzo Kyle Subido
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