Cryptocurrency Lending Platform Hodlnaut May Sell Business Instead of Liquidation: What You Need to Know

03/01/2023 07:23 • Tech Ticker • 120 views

On March 1, Simon Lee, founder of the cryptocurrency lending platform Hodlnaut, said in a message that for creditors, the plan to sell the company’s business is more appropriate than bankruptcy liquidation, and the user group of Hodlnaut can be directly taken over by the platform of the acquirer. At present, Zhu Juntao, another co-founder of Simon Lee and Hodlnaut, is in contact with potential acquirers about the acquisition.

Hodlnaut: It is more suitable to sell business than bankruptcy liquidation, and is contacting with potential investors

Hodlnaut, a Singapore-based cryptocurrency lending platform, is in talks to sell its business to potential acquirers, according to a statement from founder Simon Lee on March 1.

What Led to the Potential Sale of Hodlnaut’s Business?

Hodlnaut’s trouble began in late February when the platform was sued by users for allegedly breaching a contractual agreement. The plaintiffs claimed that they were promised a 4.8% interest rate on their cryptocurrency accounts and that Hodlnaut unilaterally reduced their rate to 3.0%.
The platform tried to assure its customers that the reduction was due to “unforeseen circumstances,” but the lawsuit has now pushed Hodlnaut towards potential bankruptcy liquidation.

Why is Selling the Business More Appropriate than Liquidation?

According to Simon Lee, the plan to sell the business is more appropriate than bankruptcy liquidation for creditors. Lee explained that the user group of Hodlnaut can be directly taken over by the platform of the acquirer.
By selling the business, Hodlnaut can potentially preserve some of its value, minimize damage to the cryptocurrency lending industry, and allow its user base to continue using the platform via the acquirer.

Who is Involved in the Sale Process?

Zhu Juntao, another co-founder of Hodlnaut, is reportedly in contact with potential acquirers about the sale. It is unclear which companies are currently interested in acquiring the cryptocurrency lending platform.

What Does This Mean for Hodlnaut’s Users?

It is unclear how the potential sale of Hodlnaut’s business will affect its users. If the sale is successful, the user base of Hodlnaut will be migrated to the platform of the acquirer.
However, if the sale does not go through, Hodlnaut may have to declare bankruptcy liquidation. This scenario could potentially lead to the loss of users’ funds, which may not be recoverable in full.

Conclusion

The potential sale of Hodlnaut’s business is a crucial development in the cryptocurrency lending industry, and its outcome could have significant implications for the platform’s creditors and users. As of now, the sale is still in its early stages, and it remains to be seen which company will acquire Hodlnaut’s business.

FAQs

1. What was the reason for Hodlnaut’s potential sale?
Ans: Hodlnaut’s potential sale is due to its ongoing legal battle with users who claimed that the platform breached their contractual agreement.

2. Why is selling the business better than bankruptcy liquidation?
Ans: Selling the business can potentially preserve some of Hodlnaut’s value, minimize damage to the cryptocurrency lending industry, and allow its user base to continue using the platform via the acquirer.
3. What is the current status of the sale process?
Ans: Zhu Juntao, another co-founder of Hodlnaut, is in contact with potential acquirers about the acquisition. It is still unclear which companies are interested in acquiring Hodlnaut’s business.

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