Haru Invest, a South Korean centralized finance (CeFi) venture that recently faced financial difficulties and legal challenges, has provided a glimmer of hope to its users with a hint at a structured asset recovery plan.
CEO Hugo Lee, in a Q&A session on October 2, shed light on the recovery plan, offering some optimism to users who have been affected by the company’s decline amid allegations of fraudulent activities. While the exact timeline for the recovery remains undisclosed, Lee provided insights into the plan’s phases.
CeFi Turmoil and Legal Challenges
The turmoil at Haru Invest began with the abrupt cessation of its operations in June, triggered by allegations surrounding its consignment operator, B&S Holdings. This raised concerns about the company’s financial stability.
In response, Haru suspended all deposits and withdrawals and initiated a thorough investigation. Subsequently, the company filed for bankruptcy, sending shockwaves through the CeFi industry and affecting crypto lender Delio, which held significant stakes in Bitcoin and Ether.
CEO’s Insights into Haru Invest Recovery
During the Q&A session, Hugo Lee outlined the roadmap for asset recovery and distribution. He acknowledged the complexity of the legal procedures currently in progress, including rehabilitation and cooperation with investigative agencies.
As a result, Lee indicated that autonomous asset distribution remains a distant goal, making it challenging to provide a precise schedule for users. However, he assured investors of a fair distribution mechanism and emphasized a commitment to fairness, regardless of whether users are based in Korea or internationally.
Global User Base
Haru Invest’s user base is diverse, with 60% of users being international and 40% native to Korea. Lee’s commitment to a fair distribution mechanism is particularly reassuring to global users who have been affected by the crisis.
Further, the company’s current circumstances have led to a minimal operational structure, with the company’s website login being non-functional. These challenges underscore the magnitude of the hurdles that Haru Invest is facing in its recovery efforts.
Denial of Wrongdoing
Haru Invest has vehemently denied allegations of a “rug pull” and has consistently expressed its dedication to protecting investor assets. However, despite the negative attention it received due to the events in June, the recent address by CEO Hugo Lee has instilled hope among its users.
Haru Invest’s journey from crisis to potential recovery not only affected the company itself, it also raised questions about the integrity of emerging CeFi platforms. As the company navigates the legal complexities on the path to asset recovery, the crypto community will closely monitor the proceedings, hoping for a demonstration of resilience and ethical conduct that can set a precedent in the industry.