The chief executive officer of a now-defunct cryptocurrency platform, Hodlnaut, was on Tuesday (May 26) charged in court for fraud by false representation.
Zhu Juntao, 36, was handed three charges and could face jail time of up to twenty years, a fine, or both, for each charge, if he is found guilty.
Hodlnaut was a crypto borrowing and lending platform which allowed its users to deposit their digital tokens to earn interest.
The Singapore Management University alumnus was also co-founder of the said online platform that purportedly had over 30,000 users worldwide before it became defunct in August 2022 following financial difficulties.
The police said on Tuesday that Zhu allegedly instigated his employees to make misleading statements on the company’s official Telegram group chat and in official emails sent directly to some of its users between May and July 2022, following a sudden price crash of TerraUSD (UST).
According to the police, Hodlnaut had allegedly asserted in these communications that it did not have direct exposure to UST and/or did not suffer losses arising from the UST crash.
Zhu is said to have published similarly misleading statements in three posts on his personal X account.
In its statement, the police also reminded members of the public to be aware of the risks associated with cryptocurrencies, highlighting that cryptocurrencies are volatile and speculative in nature, and do not carry any underlying or fundamental value.
“Dealing in cryptocurrencies is highly risky and not suitable for the general public, who also face the risk of service providers collapsing due to fraud,” it said.
Those who wish to find out more information on the associated risks can visit the MoneySense website.
[[nid:736632]]
