SINGAPORE — The collapse of Hodlnaut, once one of Singapore's best-known crypto lenders, has entered its criminal phase: co-founder and former chief executive Zhu Juntao was charged on May 26, 2026 with six counts of fraud by false representation. He has pleaded not guilty.
Zhu co-founded Hodlnaut in April 2019 with Simon Eric Lee. The platform let users deposit cryptocurrencies such as bitcoin, ether and stablecoins to earn interest, generating returns by lending those deposits to institutions and deploying them into yield-generating products — including, allegedly, the Anchor Protocol on the Terra blockchain.
The charges comprise three counts under Section 424A of Singapore's Penal Code and three counts of abetment of the same offence. Each carries a maximum penalty of 20 years' imprisonment, a fine, or both — among the heaviest fraud penalties available under Singapore law.
Hodlnaut's downfall came with the implosion of the Terra ecosystem in May 2022. Court filings indicate the company suffered losses of about US$190 million tied to its exposure to the TerraUSD (UST) stablecoin, leaving it unable to meet its obligations to depositors. On August 8, 2022, Hodlnaut suspended deposits and withdrawals and simultaneously withdrew its licensing application to the Monetary Authority of Singapore, citing market conditions. Users' funds have been frozen ever since.
The company was placed under interim judicial management in 2022, with EY partners appointed to oversee it, and was formally wound up by the Singapore High Court on November 10, 2023. As of the winding-up judgment, net liabilities were assessed at roughly S$92 million, and creditors were warned they were unlikely to recover anywhere near the full value of their deposits.
About 17,000 creditors were caught in the collapse. Major creditors included Samtrade Custodian, S.A.M. Fintech and the Algorand Foundation, which disclosed about US$35 million of exposure to Hodlnaut. The firm also faced a police investigation over delays in reporting its UST holdings.
Hodlnaut's creditors rejected a proposed restructuring plan in early 2023, preferring liquidation to maximise the remaining assets for distribution — a decision that sealed the company's fate after failed sale efforts, including a proposed buyout involving the FLEX token that quickly lost most of its value.
The criminal charges against Zhu mark one of the most significant prosecutions to emerge from Singapore's crypto winter, alongside the Three Arrows Capital saga. For the thousands of retail depositors who trusted a Singapore-based platform with their savings, the case is a test of whether the city-state's fraud laws can deliver accountability — and any recovery — years after the money vanished.