Haru Invest Fallout Spreads As Revix Withholds 24% of Crypto Asset Balance

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South African crypto investment company Revix has announced it will be withholding 24% of customers’ crypto balances. This comes in the wake of one of its partners, Haru Invest, unexpectedly suspending all deposits and withdrawals on its platform.

Revix Reserves Customer Asset Balance

According to a statement by Revix on its website, 24% of the total crypto asset balances held on the platform will now be rendered as reserved. This is the percentage of Revix’s crypto assets that are held with Haru.

This means that each customer on the platform will have almost one-fourth of their assets locked, making them untradeable and non-withdrawable. On the other hand, 100% of fiat cash balances are fully accessible to customers whenever needed.

Unfortunately, Revix has not given a timeline of when the reserved funds will become accessible again, although the company mentions that rigorous measures have been taken to protect the remaining customer assets by securely moving them into protected internal custody.

“Our team is maintaining an ongoing, active dialogue with Haru Invest. These discussions give us confidence that the recovery of assets held by Haru Invest is attainable, thereby unlocking any reserved assets,” the statement said.

Haru Invest Freezes Withdrawals Following Allegations of False Accounting

Earlier this month, Haru Invest announced that it was suspending deposits and withdrawals on its platform, citing irregularities from one of its consignment operators. According to Haru Invest, the operator, B&S Holdings, fraudulently provided false management reports in order to deceive Haru Invest and its investors.

Notice to Investors (June 16, 2023): https://t.co/xD9u6OhWXb pic.twitter.com/8WyqjvHwA9

— Haru Invest (@haruinvest) June 16, 2023

Haru Invest is a centralized finance digital asset management platform providing interest-bearing crypto deposit service and other investment solutions for crypto companies. 

Haru Invest has given no indication of if or when full access to funds will be restored, which has understandably left investors frustrated and anxious.

As it turns out, Revix is one of its customers, and its suspension of withdrawals has since impacted Revix users. The company has since filed a criminal complaint against B&S Holdings and is planning to file a civil action as well.

The fallout continues to spread, as Haru Invest has reportedly terminated the contracts of over 100 of its employees. While speaking in reference to the contract terminations, CEO Lee Hyung-soo said during a conference that “it is difficult to operate normally due to the recent situation.”

South Korean prosecutors have since prohibited top officials from Haru Investment from traveling outside of the country due to concerns over fraud and accusations regarding a rug pull.

Crypto total market cap chart from TradingView.com

Total market cap recovers above $1.15 trillion | Source: Crypto Total Market Cap on TradingView.com

Featured image from iStock, chart from TradingView.com

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