A Singapore court on August 1, granted a three-month moratorium to cryptocurrency lending, borrowing or trading start-up Vauld till November 7, 2022. Citing demand letters from a handful of creditors, the judge gave Vauld a deadline of four weeks to figure out mechanisms for withdrawal for creditors in need.
This court decision by Judge Aedit Abdullah will effectively shield the company from any potential litigation from creditors during the declared period. At the hearing, the judge directed the company to form a creditors committee in order to address the necessary issues. Post the judgement, Vauld is expected to provide details like cash flow and valuation of assets to its creditors within 2 weeks.
Vauld had earlier sought a six month moratorium from the court to strategise a possible solution to its liquidity crunch and potential acquisition by a London based crypto firm; Nexo!
Claiming to be the seventh largest creditor, amongst a total of 20 top creditors, Mathew B Mc Givern in his affidavit mentioned that Vauld owes him a total outstanding debt of over $3.5 million. Across its 20 top creditors, Vauld owes over $124.94 million. Last year, the company raised $25 million in a Series A round led by Peter Thiel’s Valar Ventures.
Although the moratorium granted is only half of the six months requested initially by Vauld, the judge stated that an extension may be possible. In the words of the judge, “I am concerned a six-month moratorium won’t get adequate supervision and monitoring,” This would ultimately depend on an assessment of the firm’s progress in engaging with its creditors, which will be assessed at the next hearing.
In an email to creditors on July 11, Chief Executive Officer Darshan Bhatija said Vauld has $330 million in assets and $400 million in liabilities at the group level. As of now, the Vauld’s operations remain halted while it has stopped withdrawals for its customers.
Discuss this news on our Telegram Community. Subscribe to us on Google news and do follow us on Twitter @Blockmanity
Did you like the news you just read? Please leave a feedback to help us serve you better
Disclaimer: Blockmanity is a news portal and does not provide any financial advice. Blockmanity's role is to inform the cryptocurrency and blockchain community about what's going on in this space. Please do your own due diligence before making any investment. Blockmanity won't be responsible for any loss of funds.
