In this article, we are going to be going over Vauld cryptocurrency financial challenges, as the decrease in bitcoin prices affects the whole crypto market.
Vauld cryptocurrency is searching for a solution
Due to the decrease in bitcoin prices, Singapore-based Vauld cryptocurrency has suspended all withdrawals, trading, and deposits on its platform and is now seeking legal action. This might not be a passing trend, as traders and industry watchers predict a “crypto winter” in the months to come, forcing many businesses to tighten their finances and streamline their operations.
Vauld cryptocurrency CEO Darshan Bathija said in a statement on Monday that the company is experiencing financial difficulties as a result of the unstable market conditions, which have resulted in significant customer withdrawals totaling more than USD 197.7 million since June 12, 2022, when the collapse of Terraform Lab’s cryptocurrency, Celcius, and the default on loans by Singapore-based cryptocurrency hedge fund Three Arrows Capital caused the market to decline. Bathija said in the statement that:
“We have made the difficult decision to suspend all withdrawals, trading, and deposits on the Vauld platform with immediate effect. We believe that this will help to facilitate our exploration of the suitability of potential restructuring options, together with our financial and legal advisors. We seek the understanding of customers of the Vauld platform that we will not be in a position to process any further requests or instructions in this regard. Specific arrangements will be made for customer deposits as may be necessary for certain customers to meet margin calls in connection with collateralized loans.”
Vauld’s staff has reduced in size dramatically
The cryptocurrency company has hired Cyril Amarchand Mangaldas and Rajah & Tann Singapore LLP as its legal counsel in India and Singapore, respectively, as well as Kroll Pte as its financial advisor. “We intend to apply to the Singapore courts for a moratorium i.e, a suspension of the commencement or continuation of any proceedings against the relevant companies so as to give us breathing space to carry out the proposed restructuring exercise,” said Bathija in the statement.
As market conditions deteriorated, Vauld cryptocurrency had previously announced a 30% decrease in headcount. Some exchanges in India were also forced to halt deposits and withdrawals, mostly as a result of implementing compliance and KYC procedures as a TDS of 1% becomes effective in July.
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