Crypto lending and exchange platform, Hodlnaut has paused all withdrawals, deposits and token exchanges as of August 8.
Hodlnaut is only the latest of many crypto platforms to freeze withdrawals over the past few months as the ongoing ‘crypto winter’ continues to bite for many smaller, potentially non-liquid concerns.
“Dear users, we regret to inform you that we will be halting withdrawals, token swaps and deposits immediately due to recent market conditions. We have also withdrawn our MAS license application. Here is our full statement https://hodlnaut.com/press/hodlnaut-message-to-our-users. Our next update will be on 19 Aug,” Hodlnaut said in a tweet.
The road to recovery
Currently, the company is actively strategizing its recovery plan and consulting with Damodara Ong LLC concerning the plan’s timeline and feasibility. Naturally, cryptocurrency owners are unhappy with the company’s decision to freeze transactions, with many fearing they will never recover their assets. While the crypto market suffered in June, it has been doing better over the past few weeks, making some skeptical of Hodlnaut’s reasoning behind the freeze of transactions.
Terra Whistleblower Warned Hodlnaut Community
Meanwhile in a Hodlnaut ‘sidestory’, it’s emerged that Fatman, the Terra whistleblower, warned crypto enthusiasts not to trust Hodlnaut prior to the company’s decision. On Jun 26, 2022, Fatman tweeted his case study of Hodlnaut, explaining why he believes the platform lied to consumers and misrepresented stablecoin staking risks.
🧵 CeFi degeneracy knows no bounds. Here’s a case study into Hodlnaut – a centralized yield platform – and why I believe they have both lied to & misrepresented stablecoin staking risks to customers. These websites are not as trustworthy as you may think. (1/25)
— FatMan (@FatManTerra) June 26, 2022
Fatman explained that Hodlnaut offered high annual percentage yields for Terra’s UST and LUNA tokens when adding them to the platform. However, the platform publicly stated it had no connections or experience with Anchor. In a suspicious move, Hodlnaut has taken down their team page and according to Fatman, CEO and co-founder of Hodlnaut, Juntao Zhu has threatened to sue him over his informative Twitter thread.
“Genuinely hope everything is okay there,” tweeted Fatman after Hodlnaut froze withdrawals. “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.”
While there are signs of the crypto market regaining some of the early 2022 losses it’s still too early to make claims of any kind of crypto comeback. Evidence suggests that more firms may feel a similar crunch before recovery arrives.
We look forward to Hodlnaut’s August 19 update.
Jack Brassell is a freelance journalist and aspiring novelist. Jack is a self-proclaimed nerd with a lifelong passion for storytelling. As an author, Jack writes mostly horror and young adult fantasy. Also an avid gamer, she works as the lead news editor at Hardcore Droid. When she isn't writing or playing games, she can often be found binge-watching Parks & Rec or The Office, proudly considering herself to be a cross between Leslie Knope and Pam Beasley.
