Singapore's Commercial Affairs Department charged former Hodlnaut chief executive Zhu Juntao on May 26, 2026, with six counts of fraud by false representation — alleging he directed employees to deceive more than 30,000 customers about the firm's exposure to TerraUSD as the algorithmic stablecoin collapsed in 2022.
The Singapore Police Force said prosecutors allege Zhu instructed Hodlnaut staff to publish false statements on the company's official Telegram channels and in emails sent directly to users between May and July 2022, falsely asserting the platform had no direct exposure to UST and had not suffered losses from its crash. Zhu also published three posts on his personal X account in June 2022 containing similar claims, according to the SPF announcement. Hodlnaut had, in fact, channelled roughly $317 million of user funds into Terra's Anchor Protocol, which was offering around 19.5% annualized yield on UST deposits before the ecosystem imploded. Court-appointed judicial managers later estimated the firm lost approximately $189.7 million from that exposure.
Three charges are brought under Section 424A(1)(a) read with Section 424A(3) of the Penal Code 1871 — covering Zhu's personal conduct — and three further charges add Section 109, which covers abetment, for his alleged direction of employees. If convicted on each count, Zhu faces up to 20 years in prison, a fine, or both. He disputed all six charges in court; a pre-trial conference is scheduled for June 2026.
Hodlnaut halted withdrawals in August 2022 and subsequently entered judicial management. The Singapore High Court ordered the lender into liquidation in November 2023. The charges arrive nearly four years after the collapse, positioning Singapore among the first jurisdictions to bring criminal fraud charges directly tied to the 2022 Terra crisis — a distinction that will be closely watched by legal teams across the industry. The Terra implosion wiped roughly $40 billion from the broader crypto market and pulled down Three Arrows Capital, Celsius, and Voyager alongside Hodlnaut.
The case frames a durable liability principle for crypto executives: misleading customers about risk exposure during a market crisis, even in the absence of formal crypto-specific regulation at the time, can support criminal fraud prosecution years later. For Southeast Asian regulators still building their enforcement track records, a conviction would confirm that the standard investor-protection statutes already on the books reach conduct that was previously treated as the cost of doing business in an unregulated sector.
Sources: Singapore Police Force, 26 May 2026; CoinDesk, 27 May 2026; Channel NewsAsia, 27 May 2026.