Singapore-based Crypto Exchange Vauld Receives Court Approval for Board Restructuring Amidst Bankruptcy Proceedings
Summary:
Singapore-based crypto exchange Vauld, currently in bankruptcy proceedings, receives court permission to restructure its board. New management will lead the company's recovery. KYC verification process resumes for existing customers. $46.4 million seized from Indian branch due to money laundering allegations. Company froze customer withdrawals citing market conditions. Negotiations for acquisition halted after raid at Nexo's office. Vauld owes creditors $400 million, majority in individual deposits.
Singapore-based crypto exchange Vauld, currently undergoing bankruptcy proceedings since August 2022, has received court approval to revamp its board of directors. The newly appointed top management will oversee the company's efforts to secure its financial recovery. Co-founder Darshan Bathija recently announced on X (formerly Twitter) that Vauld's scheme of arrangement had been successfully passed in a Singapore court. As part of the restructuring, the current board will be replaced by a new CEO, a creditor representative, and a scheme manager. Additionally, the platform has restarted the know-your-customer (KYC) verification process for existing customers, requiring them to resubmit their documentation for verification. In August 2022, law enforcement in India seized $46.4 million from Vauld's Indian branch, Flipvolt Technologies, due to allegations of money laundering. Vauld halted customer withdrawals in July 2022, attributing it to adverse market conditions and significant withdrawal requests amounting to $200 million. The company suffered losses associated with the declining prices of major cryptocurrencies and exposure to the collapsed stablecoin UST in May 2022. Subsequently, Vauld obtained a three-month moratorium to develop a restructuring plan. While an acquisition by Swiss-headquartered crypto lender Nexo had been proposed, negotiations were halted following a raid at Nexo's office by law enforcement in January 2023. Vauld was granted further creditor protection by a Singapore court in the same month, which was later extended in February. The company currently owes approximately $400 million to its creditors, with the majority attributed to individual depositors' funds.
Published At
8/25/2023 11:59:50 AM
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