Vauld Receives Three- Month Prohibition From Singapore Court

Vauld Receives Three- Month Prohibition From Singapore Court
  • DeFi only paid for half of the requested six-month moratorium.
  • Vauld ceased deposits, withdrawals, and transactions at the beginning of July.

On August 1, a Singaporean court granted cryptocurrency lending startup Vauld a three-month suspension until November 7, 2022. After receiving demand letters from a few creditors, the judge further ordered the business a four-week deadline to look into withdrawal options for creditors who were in need.

The moratorium will shield DeFi Payments from decisions on the company’s liquidation, the selection of a manager or managers, and any legal actions that may be taken against it, including those that may be taken by its 147,000 creditors.

Before this, Vauld had asked the court for a six-month moratorium so that it could plan how to get the company out of its current liquidity crisis and avoid being acquired by London-based cryptocurrency lender Nexo. While the court processes are ongoing, the financing business is currently conducting due diligence over a 60-day exploratory period.

According to information provided by Vauld in July, The crypto lending firm owes its creditors more than $400 million.

Withdrawals Flaws to Overcome Financial Challenges

A regrettable situation brought on by the decline in cryptocurrency markets occurred on July 5 when Vauld banned all withdrawals, trading, and deposits on its platform. As a result, the company declared its intention to investigate possible restructuring options to deal with its current problems. 

The recent market crisis  had a significant impact on several lending firms, including Vauld, Three Arrows Capital, Celsius Network, Voyager Digital, and BlockFi.

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