On August 8, the crypto exchange and lending platform Hodlnaut announced that the company has paused withdrawals, token swaps, and deposits. Hodlnaut joins a slew of crypto firms that have frozen withdrawals during the last three months, leaving customers little hope that they will see their funds again. Well before Hodlnaut’s withdrawal pause, the Terra whistleblower called Fatman warned people about Hodlnaut’s alleged issues.
Another Crypto Platform Freezes Operations Citing Recent Market Conditions
Another crypto exchange and lending platform, called Hodlnaut, has revealed it has suspended all operations including withdrawals, token swaps, and deposits. “Dear users, we regret to inform you that we will be halting withdrawals, token swaps, and deposits immediately due to recent market conditions,” the company tweeted on Monday. We have also withdrawn our MAS license application. Here is our full statement — Our next update will be on [August 19],” Hodlnaut added.
Of course, the crypto community was not pleased with Hodlnaut’s decision and either criticized the platform or made fun of the business and its customers. The “not your keys, not your coins” adage is prominent in Hodlnaut’s Twitter announcement thread. In the blog post the crypto company shared on Twitter it notes that the company is focused on stabilizing “liquidity and preserving assets.”
“We are actively working on the recovery plan that we hope to provide updates and details on as soon as permissible,” Hodlnaut’s blog post details. “We are consulting with Damodara Ong LLC on the feasibility and timelines of our intended execution plan and are strategising our recovery plan with our users’ best interests in mind.” Hodlnaut’s withdrawal pause follows companies like Celsius, Voyager Digital, Babel Finance, and Vauld freezing withdrawals as well.
Prior to Hodlnaut freezing withdrawals, the Terra whistleblower Fatman warned people about the platform and stressed at the time that “these websites are not as trustworthy as you may think.” Fatman explained how Hodlnaut added Terra’s UST and LUNA (now referred to as classic coins) with high annual percentage yields (APY). Fatman further detailed that Hodlnaut told the public that it had no exposure to Anchor. When Terra collapsed, the platform temporarily suspended LUNA and UST swaps on May 9, and two days later Hodlnaut wrote:
Hodlnaut is NOT all-in on UST as one particular rumour on Reddit has mentioned. This is a false claim.
Crypto Whistleblower Accuses Hodlnaut Team of Taking in Deposits ‘Under False Pretenses’
Following the withdrawal pause on August 8, Fatman said that tweeting out the warning to people was worth it in the end. “Hodlnaut has now frozen all withdrawals,” Fatman said. “Genuinely hope everything is okay there. If there are major issues, a lot of good people will go under. Got tons of hate on my thread from Hodlnaut fans, but also got messages from grateful customers who withdrew, so it was 100% worth it.” Fatman added that he was allegedly threatened by lawsuits from the Hodlnaut team when he posted the Twitter thread about the firm at the end of June.
“Hodlnaut has taken down their team page — It’s not that easy. Juntao Zhu stated he would be filing lawsuits against me for my Twitter thread. These lawsuits never came and never will. JT [and] Chang Teck Goh criminally took in more deposits under false pretenses and deserve jail,” Fatman insisted.
The whistleblower also said he sent an email to the Monetary Authority of Singapore (MAS) in June as well. He noted that he didn’t think it was a good idea for “Singaporean authorities to give Hodlnaut any semblance of legitimacy.” However, nobody from MAS responded to the whistleblower’s email and said he felt bad for possibly not pushing hard enough before the withdrawal pause took place. Fatman has become a very popular individual in the crypto community and his social media presence has managed to gain him close to 100,000 followers.
What do you think about Hodlnaut’s withdrawal pause? What do you think about Fatman’s accusations? Let us know what you think about this subject in the comments section below.
Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,700 articles for Bitcoin.com News about the disruptive protocols emerging today.
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