Singapore-Based Crypto Lending Firm Holdnaut Halts Withdrawals

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Singapore-based lending platform Hodlnaut paused withdrawals, swaps and other activities
The firm has withdrawn license application from the Monetary Authority of Singapore (MAS)
Hodlnaut cited market conditions for the decision

Singapore-based crypto lending and borrowing firm Hodlnaut has stopped withdrawals, swaps and deposits on the platform following "recent market conditions."

The company said in an announcement Monday that it will focus on stabilizing its liquidity and preserving assets while also working to find the best way to protect the users' long-term interests.

"We would also like to inform our users that, as a result of the above reasons, we have since informed the MAS of our intention to withdraw our license application. Hodlnaut is therefore no longer providing regulated digital payment token (DPT) services, ie our token swap feature. For the avoidance of doubt, Hodlnaut will also cease all borrowing and lending services," the announcement read.

Hodlnaut had applied for a license with the Monetary Authority of Singapore (MAS) to provide DPT services in the region in March but is no more focused on expansion it seems.

Many crypto firms have experienced liquidity issues recently. Crypto lender Celsius paused withdrawals on June 13 and filed for bankruptcy. The users are still waiting to withdraw their funds.

Voyager Digital, another crypto service provider, filed for protection under Chapter 11 bankruptcy on July 6 after pausing withdrawals on July 1. However, in a recent turn of events, the firm has been greenlit to pay $270 million in customer cash present in the custodial account in the Metropolitan Commercial Bank.

Significantly, FTX CEO and crypto billionaire Sam Bankman-Fried pointed out that many crypto exchanges are "secretly insolvent" adding that they have fallen beyond redemption. Bankman-Fried has spent money from his own pocket to bail out many crypto firms from their liquidity issues.

"There are companies that are fundamentally too far gone and it's not practical to bail them out for reasons like a significant hole in the balance sheet, regulatory issues, or because there's not much of a business left to salvage," Bankman-Fried said in a June report.