South Korean digital asset savings and lending firm Delio has plunged into a deeper crisis more than a month after suspending user withdrawals. The authorities seized Delio’s assets on July 18th, which reportedly disrupted its operations.
According to the latest update, the actions by the South Korean regulator have made it “difficult for the company to provide normal services.” It also highlighted the need to prevent the scattering of the platform’s property in the interest of depositors.
- In a notice (translated from Korean), Delio raised concerns over its ability to function normally after the South Korean Financial Services Commission (FSC) confiscated all assets owned by customers and the company, as well as other cold wallets and ledgers.
- Delio was a major player in the South Korean cryptocurrency ecosystem.
- The lending firm temporarily suspended withdrawals starting from June 14, citing increased market volatility and investor confusion at sister lending company Haru Invest, which stopped deposits and withdrawals just a day earlier.
- Delio further said it was focused on safeguarding customer assets in its custody and added that withdrawals will remain suspended till the issue is resolved.
- A few days later, Delio chief executive Jung Sang-ho revealed that the lending platform would resume withdrawals. No further timeline was shared with regard to suspended services.
- The decision to abruptly halt withdrawals attracted backlash from the community while the FSC launched an inquiry into the firm’s activities due to accusations of fraud, embezzlement, and breach of belief.