Haru Invest and Delio Hit by Class Action Lawsuits as Billions in Crypto Remain Frozen

• Crypto platforms Haru Invest and Delio are facing potential class-action lawsuits as they suspend customer withdrawals and deposits, causing investors to seek legal recourse.
• South Korea, one of the largest crypto markets, witnesses billions worth of crypto assets traded daily, making the situation significant in the country’s crypto landscape.

Haru Invest and Delio, two prominent crypto platforms in South Korea, have found themselves embroiled in controversy as they abruptly suspended customer withdrawals and deposits. The sudden move has prompted over 400 Haru Invest investors and 150 Delio investors to come together in a KakaoTalk group chat, preparing for potential class-action lawsuits against the crypto firms. The investors are considering charging the platforms with fraudulent activities, seeking legal assistance from the esteemed law firm LKB & Partners.

Both Haru Invest and Delio offer earn services that allow users to earn yields by depositing their crypto assets on the platforms. Haru Invest boasted a maximum yield of 12 percent, while Delio offered up to 10 percent. However, on Tuesday, Haru Invest shocked its users by suspending deposits and withdrawals, citing false information provided by its consignment operator, B&S Holdings. In response, Haru Invest has taken the matter to court, filing a criminal lawsuit against B&S Holdings. Delio, closely following Haru Invest’s suspension, halted withdrawals due to market volatility exacerbated by the events surrounding Haru Invest. Allegedly, Delio had deposited a certain amount of crypto assets in Haru Invest, heightening concerns among its investors. As a result, Delio plans to hold an investors’ meeting on Saturday to address the situation and discuss possible means of recovering investments.

Delio CEO Jung Sang-ho expressed his sincere apologies to investors who had trusted the platform, vowing to provide a transparent account of the current situation and explore viable avenues for recouping investments. The developments have created a wave of uncertainty in the South Korean crypto market, given the significant trading volumes amounting to billions of dollars that flow through various crypto platforms in the country on a daily basis.

In a further twist, concerns have been raised about Haru Invest’s potential exposure to the embattled crypto exchange FTX. CryptoQuant CEO Ki Young Ju revealed that Haru Invest may have utilized FTX for its operations, as reported by OXT Research. If the report holds true, it suggests that Haru Invest has kept its investors in the dark regarding its involvement with FTX for almost a year. On-chain data reveals that Haru Invest’s transactions with FTX, particularly during the Terra-LUNA crash in 2022, were the most significant transfers to its Bitcoin address, raising questions about the extent of its exposure and the transparency provided to its users.

As the legal battles loom and the South Korean crypto market absorbs the impact of these suspensions, the Haru Invest and Delio cases serve as reminders of the importance of transparency, accountability, and investor protection in the rapidly evolving world of cryptocurrency.

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