Singaporean crypto-lender, Vauld Group announced today that it has reached a decision to suspend withdrawals, trading, and deposit transactions on its platform. A corporate statement written by Darshan Bathija, the CEO of the firm was released to this effect. He pointed out the unpleasant situations and financial challenges being faced by the company.
Bathija attributed the unfortunate situation to a fusion of events ranging from market volatility to the current bearish atmosphere. He mentioned that the financial difficulties experienced by the key partners affected the firm too. Most of Vauld’s customers resorted to withdrawing a huge amount of their funds. This was up to $197.7 million since the news of Terra’s collapse went viral.
According to the CEO, this halt will afford Vauld the opportunity to explore and ascertain the sustainability of intended restructuring options. No transaction will be processed; whether deposits or withdrawals until a workable solution is discovered. He pleaded with users to understand the intention behind the suspensions on its platform.
Meanwhile, emergency transactions involving collateral loans are under consideration. A special arrangement is permitted for such deposits which entail meeting marginal calls.
Additionally, Vauld onboarded Cyril Amarchand Mangaldas and Rajah & Tann Singapore LLP on its legal team. Kroll Pte Limited, a private financial advisor also was recruited to offer advisory services in the wake of current realities.
Vauld Action Plans for the Extreme Market Conditions
The distressed lender is positive that with the help of the financial advisor and the legal team, much progress would be recorded.
An application for a moratorium from Singaporean courts will also be made. The moratorium is to aid the suspension of the commencement or continuation of any proceedings against the firm from the relevant companies. Vauld believes this will give breathing space to carry out the proposed restructuring exercise.
Babel Finance, Celsius, and many other crypto firms have also had their turns in halting transactions. The Hong Kong-based crypto lender Babel Finance finally succumbed to the heat and paused all withdrawals and redemption. The company also faces the possibility of liquidation.
Celsius declared an immediate suspension on its withdrawal via a blog post last week. The firm also decided to halt its swap and transfer products also. The prevalent extreme market conditions are obviously taking their toll on the crypto companies.