After abruptly suspending withdrawals in June, Haru Invest has dropped another bombshell. The battered cryptocurrency yield platform is now planning to shut down its server in an apparent attempt to cut costs.
High server maintenance costs or ‘rug pull’?
Hugo Lee, CEO of Haru Invest, said Monday that server maintenance costs of services are costing the company a fortune. Lee claims server maintenance costs are the “largest percentage of fixed costs” at Haru Invest, and therefore, the company is looking to suspend its server to bring the costs down.
Although Haru Invest plans to “suspend the service in a few weeks, backing up all member information,” the crypto platform still doesn’t have “a definite plan” for suspending its servers. The move to shut down the server is part of the company’s broader plan to trim the costs of its operations, according to Lee.
“Some of the current fixed expenditures include the upkeep of Haru Invest services, the cost of workspace like the office, and the cost of communication with our members.”
According to media reports, the Haru Invest community is outraged over the news of a suspension, with many arguing that server maintenance is not burning a hole in the company’s pocket as it has been claiming.
A disgruntled user took to Haru Invest’s Telegram channel, and said, “Server costs cost nothing.” “Servers are gone soon guys, huge costs, 200 USD a month,” another user quipped. Maintenance costs of running a server for small to medium businesses could be anywhere between $35-500.
Allegations of fraud against Haru Invest
This isn’t the first time Haru Invest is in the hot waters. In June, the crypto platform suspiciously halted deposits and withdrawals, and later shut down its offices and eliminated dozens of jobs. Some concerned investors have sued Haru Invest–alleging it has orchestrated a” rug pull”, but Haru Invest has denied any wrongdoing.
The road ahead to curb crypto crime
The development comes at a time when South Korea is grappling with a rise in crypto-related crimes. To combat illicit activities in the crypto space, the South Korean government has established a joint regulatory body and introduced groundbreaking legislation to keep crypto exchanges operating on South Korean soil in check. With South Korea’s crypto market growing at an unprecedented rate, the government, it seems, is doubling down on consumer protection.