© Bragona Scalabby. All rights reserved.

Another crypto lender Vauld pauses withdrawals as market crash takes its toll

July 5, 2022

Crypto lender Vauld on Monday paused all withdrawals, trading and deposits on its platform and is exploring potential restructuring options, the company said.

Vauld CEO Darshan Bathija said in a blog post on Monday that the company is facing “financial challenges” due to “volatile market conditions, the financial difficulties of our key business partners inevitably affecting us, and the current market climate” which has led to customers withdrawing more than $197.7 million from the platform since June 12.

The Singapore-based company said it is working with its financial and legal advisors to “explore and analyse all possible options, including potential restructuring options, that would best protect the interests of Vauld’s stakeholders.”

Vauld’s move to halt withdrawals comes less than three weeks after CEO Bathija said the company “continues to operate as usual despite volatile market conditions.” In a June 16 blog post, Bathija said withdrawals were being “processed as usual and this will continue to be the case in the future.”

But Vauld has become the latest victim of the plunge in cryptocurrency prices this year. Bitcoin had its worst quarterly performance since 2011 in the second quarter. Billions of dollars were wiped off the value of the cryptocurrency market in the three-month period.

The market crash has exposed flaws in a number of cryptocurrency projects and business models. In May, algorithmic stablecoin terraUSD collapsed taking down its sister token luna. Meanwhile, major cryptocurrency hedge fund Three Arrows Capital fell into liquidation after defaulting on a more than $660 million loan from Voyager Digital.

Crypto lending firms such as Vauld have faced liquidity issues. Celsius last month paused withdrawals for customers citing “extreme market conditions.”

Vauld said it is “in discussions with potential investors” in the company.

The company said it has hired Kroll Pte Limited as its financial advisor, as well as Cyril Amarchand Mangaldas and Rajah & Tann Singapore LLP as its legal advisors in India and Singapore respectively.

Source: https://www.cnbc.com/2022/07/04/crypto-lender-vauld-halts-withdrawals-as-market-crash-takes-its-toll-.html

Leave a Reply

Your email address will not be published. Required fields are marked *

    Please fill in the form bellow:

    *Due to the Covid-19 situation and the recent high demand in our services, our team might be overloaded and won’t be able to answer you as quickly as usual. We’re doing our best to provide the same high level of support services to you, however we kindly ask you to be patient if the response would take time.

    Ready to get started?

    Learn more about our subscribtions

    © Bragona. All rights reserved.