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Vauld Suspends Operations Due To Financial Difficulties

Singapore-based crypto lending platform Vauld has halted withdrawals, deposits, and trading. The company announced this news earlier today, citing financial difficulties as the reason for pausing operations. Vauld claims its financial strains emanate from multiple factors, including market volatility, struggling partners, and the recent crypto market downturn.

According to the company, poor market conditions have seen investors withdraw more than $197.7 million since June 12.

To help keep stakeholders safe, Vauld claims to have hired Kroll Pte Limited as its financial advisor. Additionally, the firm hired Cyril Amarchand Mangaldas and Rajah & Tann Singapore LLP as its legal advisors in India and Singapore, respectively.

Assuring customers that the company is actively working to resolve the problem at hand, Vauld CEO Darshan Bathija said:

Our management remains fully committed to working with our financial and legal advisors to the best of our abilities to explore and analyse all possible options, including potential restructuring options, that would best protect the interests of Vauld’s stakeholders.

Vauld Plans to Apply for a Pause from Singapore Courts

Bathija added that Vauld plans to make specific arrangements for customer deposits. However, these arrangements are only for customers that need to meet margin calls for collateralized loans.

He further noted:

We intend to apply to the Singapore courts for a moratorium i.e. a suspension of the commencement or continuation of any proceedings against the relevant companies so as to give us breathing space to carry out the proposed restructuring exercise.

Vauld is supported by VCs like Coinbase Ventures, Pantera Capital, and Valar Ventures. With the above companies specializing in crypto, the market downturn has left them deeply scathed. It is unlikely that they will be able to bail out Vauld. 

Bear Market Continues Wrecking Crypto Companies

This news comes after Vauld laid off 30% of its staff in the past month due to the crypto winter. The company also cut its marketing expenses, slowed down its hiring efforts, and slashed compensation for executives by 50%.

Meanwhile, Three Arrows Capital (3AC) plunged into liquidation in the past week after struggling to stay afloat since mid-June. According to a source familiar with the matter, a British Virgin Islands court ordered the liquidation. Partners of New York-based Teneo Restructuring will handle the company’s insolvency.

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Celsius Network is still grappling to remain solvent. Since suspending withdrawals, transfers, and swaps on June 13, the firm is yet to announce any recovery plans. Celsius continues calling on its customers and shareholders to be patient, claiming an effective solution will take time.

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