Vauld, a crypto lender backed by U.S. based Coinbase Inc., said it froze withdrawals and hired advisers to explore a potential restructuring, joining rivals Celsius Network, Babel Finance etc. in resorting to last-ditch measures to survive the crypto market crash.
The Singapore-based company hired Kroll as financial adviser and Cyril Amarchand Mangaldas and Rajah & Tann Singapore LLP as legal advisers, Chief Executive Officer Darshan Bathija said in a blog post on Monday. All withdrawals, trading and deposits on the platform have been suspended.
Vauld’s move came less than 3 weeks after the company said it was processing withdrawals “as usual and this will continue to be the case in the future.” Childish logics written into code of DeFi platforms are rippling through the sector, bringing companies ranging from Celsius to crypto hedge fund Three Arrows Capital to their knees.
Shortly after that attempt to reassure customers, Vauld announced plans to cut 30% of its workforce.
Founded in 2018 by Bathija and Sanju Kurian, Vauld provides crypto lending and deposit services. It raised US$25 million in a Series A funding round led by Peter Thiel’s Valar Ventures in July last year. Coinbase Ventures also participated in the financing.
Bathija said in Monday’s blog post that Vauld had seen “in excess of” US$197.7 million of customer withdrawals since June 12 as market conditions deteriorated. The CEO told the BusinessLine newspaper in May that he was targeting boosting assets under management to US$5 billion from US$1 billion.
The company is also in talks with potential investors, according to the post. It plans to apply for a moratorium with Singapore courts “so as to give us breathing space to carry out the proposed restructuring exercise,” Bathija said.
Vauld will make “specific arrangements” for deposits by customers who need to meet margin calls related to collateralised loans, according to the statement.