Crypto Firm Vauld Gets Creditor Protection From Singapore Court

The crypto space witnessed the bankruptcy of some firms attributable to the prevailing bearish trend in 2022. Without much warning, the crypto winter swept off a number of funds as the worth of most crypto assets plummeted. Subsequently, many corporations drowned within the storm of chaos and filed for bankruptcy.

Vauld was among the many firms impacted by the chain of events of last 12 months. The crypto lending firm struggled following this resulting in its suspension of withdrawals on the platform. It later filed for defense from its Singaporean creditors.

Vauld was previously granted three-month protection by its creditors, but a Singapore court has now prolonged the creditor protection period for Vauld. In accordance with Bloomberg’s report, the court gave Vauld till February 28, 2023, to plot a revival plan on its present negotiations.

Vauld Request For Extention of Creditor Protection Approved

Following its bankruptcy, Vauld has received indications from two digital asset fund managers excited about its assets. They’re looking for to take over the remaining Vauld assets. Because of this, the crypto lending platform requested more time from the court to handle the main points of a possible takeover of its assets.

In accordance with Vauld, the negotiations have moved to the advanced stage and would require more time to conclude. Hence, the Singapore high court approved an extension period of over a month for the firm to finish all of the detailed processes in its negotiations.

Vauld halted withdrawals on its platform in July 2022, making it unattainable for its over 800,000 users to access their funds. As well as, the lending firm linked its motion to the lingering bearish trend within the digital asset market, negatively impacting its general activities.

On July 8, it filed for a six-month moratorium order to assist the firm prepare for restructuring its operation and management. Also, the period was for the corporate to make sure a greater decision for its creditors based on their stuck assets on the platform.

Nonetheless, it only got approval for just three months. The judge mentioned that getting a more prolonged period for a moratorium might be unproductive. As well as, the judge said it could lack the correct monitoring and supervision it ought.

Nexo showed an interest in acquiring Vauld and its stuck assets from the beginning of the previous moratorium. However the intention of the Swiss-based firm was short-lived. Nexo’s office in Sofia, the capital of Bulgaria, was raided by police. This made Vauld change its mind on the cope with the Swiss-headquartered digital asset lender Nexo.

Singaporean Authorities And Crypto Regulations

Crypto lending in Singapore has been looking hazy recently. A few of the affected corporations within the crypto space are based in Singapore. This has put more pressure on the country’s crypto regulatory stances.

Before now, the Singapore authorities have been willing to permit distressed crypto firms to handle their issues. One such company is Zipmex, a Singapore-based platform.

Cryptocurrency market trends within the green zone | Source: Crypto Total Market Cap on TradingView.com

In August 2022, Zipmex received a three-month moratorium grant from a Singapore High Court. This offered the firm protection from creditors throughout the period, enabling it to repair its liquidity challenges.

The Monetary Authority of Singapore (MAS) is raising proposals for higher crypto regulations. Also, it proposes to ban DPTSP (digital payment token service providers) from offering credit facilities as fiat and crypto assets.

Featured image from Bitcoin Wisdom and chart from Tradingview.com

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