Important Facts:
- On Monday, cryptocurrency lender Vauld halted all deposits, trades, and withdrawals from its platform and said it was looking into possible restructuring alternatives.
- Due to “volatile market conditions,” according to Vauld, it is experiencing “financial issues,” which have caused users to withdraw more than $197.7 million from the site since June 12.
- Vauld is the newest casualty of this year's cryptocurrency price collapse, which has revealed weaknesses in numerous digital coin projects and business structures.
Crypto lender Vauld on Monday paused all withdrawals, trading and deposits on its platform and is exploring potential restructuring options, the company said.
Vauld CEO Darshan Bathija said in a blog post on Monday that the company is facing “financial challenges” due to “volatile market conditions, the financial difficulties of our key business partners inevitably affecting us, and the current market climate” which has led to customers withdrawing more than $197.7 million from the platform since June 12.
The Singapore-based company said it is working with its financial and legal advisors to “explore and analyze all possible options, including potential restructuring options, that would best protect the interests of Vauld’s stakeholders.”
Vauld’s move to halt withdrawals comes less than three weeks after CEO Bathija said the company “continues to operate as usual despite volatile market conditions.” In a June 16 blog post, Bathija said withdrawals were being “processed as usual and this will continue to be the case in the future.”
But Vauld has become the latest victim of the plunge in cryptocurrency prices this year. Billions of dollars were wiped off the value of the cryptocurrency market in the three-month period. Meanwhile, major cryptocurrency hedge fund Three Arrows Capital fell into liquidation after defaulting on a more than $660 million loan from Voyager Digital. Celsius last month paused withdrawals for customers citing “extreme market conditions.”
Vauld said it is “in discussions with potential investors” in the company.
The company said it has hired Kroll Pte Limited as its financial advisor, as well as Cyril Amarchand Mangaldas and Rajah & Tann Singapore LLP as its legal advisors in India and Singapore respectively.
Conclusion
The collapse of cryptocurrency prices this year has revealed weaknesses in numerous digital coin projects and business structures. This serves as a reminder that investors should do their research before investing in any cryptocurrency. While there is still potential for massive profits in the cryptocurrency market, investors should remember that it is a high-risk investment and be prepared to lose everything you put in. Remember, when trading cryptocurrencies, always use caution and never invest more than you can afford to lose.
Source: https://www.cnbc.com/
John Ravenporton is a writer for many popular online publications. John is now our chief editor at DailyTechFeed. John specializes in Crypto, Software, Computer and Tech related articles.
