Home » Cryptocurrency lender Vauld halts withdrawals and considers restructuring

Cryptocurrency lender Vauld halts withdrawals and considers restructuring

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Along with rivals including Celsius Network and Babel Finance, Vauld, the Coinbase Inc.-backed cryptocurrency lender, said it had suspended withdrawals and hired advisers to investigate a potential restructuring to weather the market crash. The Singapore-based company has retained Cyril Amarchand Mangaldas and Rajah & Tann Singapore LLP as legal and financial advisors, according to CEO Darshan Bathiji’s blog post on Monday. The site has stopped all trading, deposits and withdrawals.

Less than three weeks after declaring that withdrawals were processed as usual and would continue to be so in the future, Vauld made his move. The reversal is a sign of how quickly falling prices are affecting the industry, wiping out companies such as Celsius and hedge fund Three Arrows Capital. Vauld soon revealed plans to cut employment by 30% after trying to appease clients.

Vauld’s latest announcement drew a tepid response from cryptocurrency markets, with bitcoin trading 1.3 percent lower at $19,180 at 10:30 a.m. in London on Monday. The largest cryptocurrency has fallen more than 70% since its peak in November.

Bathija and Sanju Kurian founded Vauld in 2018, which offers lending and deposit products in cryptocurrencies. In July of last year, it raised $25 million in Series A funding led by Peter Thiel’s Valar Ventures. In addition, Coinbase Ventures participated in the financing. Vauld had customer withdrawals of “over” $197.7 million as of June 12 as market conditions worsened, according to Bathija’s Monday blog post. The CEO said his goal was to increase assets under management from $1 billion to $5 billion in an interview with BusinessLine in May. According to the post, the store is also in talks with possible investors. According to Bathija, the company intends to seek a moratorium from the Singapore courts “to give us space to carry out the proposed restructuring procedure”.

According to the statement, Vauld would make “special arrangements” for the deposits of clients who have to meet calls for additional payment for secured loans.

Featured Image: DepositPhotos © Frozenpeas

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