Singapore has opened an investigation into the Hodlnaut cryptocurrency lender to look at how it operates. Singapore's Commercial Affairs Department (CAD) is currently looking into whether Hodlnaut has engaged in dishonest and deceptive practices. Several reports between August and November allegedly stated that Hodlnaut and its directors had given "false representations" regarding the lender's exposure to a certain digital coin. Singapore's unit for investigating white-collar crime is called the CAD.
The name of the token in question is unknown. According to reports, it alludes to Terra's creation, the USTC cryptocurrency token, which fell pretty abruptly in May of this year.
Holdnaut had lost about $190 million (approximately Rs. 1,550 crore) after Terra's demise, leaving its coffers in the red.
In order to prevent the closure of its firm in August, Hodlnaut had to halt withdrawals from its platform.
Holdnaut hasn't responded to the development as of yet.
Crypto winter was brought on by the collapse of the Terra ecosystem, which included the algorithmic stablecoin UST and sister token LUNA.
Along with the high-profile failures of the cryptocurrency lenders Celsius and Voyager, as well as the hedge fund Three Arrows Capital, Terra's collapse also brought about increased regulatory scrutiny of stablecoins and cryptocurrency investing.
Soon after Terra's bankruptcy, Reserve Bank of India (RBI) governor Shaktikanta Das warned against dabbling in the cryptocurrency industry.
"The fundamental [value] of this [crypto] is nothing. How to regulate it raises a lot of issues. Our stance hasn't changed; it gravely threatens India's monetary, financial, and macroeconomic stability, the governor had declared at the time.
Over $200 billion (roughly Rs. 16,30,000 crore) was erased from the market in the market movements that followed the collapse of Terra and then FTX crypto exchange this month, leaving the global crypto valuation at $828 billion at the moment.
To maintain their respective businesses, some cryptocurrency startups, including Lemon Cash, Genesis, and Vauld, had to fire staff members.
