Crypto lender Hodlnaut follows other firms in freezing withdrawals

Illustration by Alex Castro / The Verge

The firm halted withdrawals in response to the market conditions. The company announced on its website that it is freezing withdrawals, token swaps, and deposits due to an uncertain economy.

The company withdrew its application for a regulatory license that would allow it to offer digital payment token services in the city-state. The withdrawal of the license means that the firm can't offer token swaps anymore. Borrowing and lending services are being suspended for the sake of doubt.

The crash of TerraUSD in May set off a domino effect across the entire industry, with Three Arrows Capital collapsing and other firms, like Babel Finance and Vauld, stopping withdrawals. One of Celsius' institutional clients is listed in a bankrupt filing.

There are over $500 million in assets under management by the company. The company will give an update to customers on August 19th, as it works with a Singaporean legal firm to come up with a new strategy.

While we work to find the best way to protect our users' long-term interests, we have taken a difficult decision to focus on stabilising our liquidity. We are working on a recovery plan that we hope to give an update on as soon as possible.