Crypto platform Vauld, which halted customer withdrawals last month, has secured protection against creditors for three months from the Singapore High Court, Bloomberg News reported Aug. 1.
Vauld’s parent company Defi Payment Ltd. had requested the court for a six-month moratorium. However, the court only granted a moratorium for three months, which will last till November 7.
The moratorium provides Vauld with protection against its 147,000 creditors, who cannot take legal action against the company until the moratorium is lifted.
Vauld’s moratorium may be extended based on the firm’s progress in working with creditors, the court said. The court ordered the lender to form a creditors committee to address issues and the court will assess the progress at the next hearing, according to Bloomberg.
The court also asked Vauld to provide cash flow details to creditors within two weeks. And the lender has eight weeks to share management of accounts information with creditors, the news outlet reported.
Vauld needed the moratorium period to restructure, complete Nexo’s due diligence, and reconcile group company accounts, according to a lawyer for Defi Payments, Bloomberg reported.
Soon after halting withdrawals and trading on its platform, Vauld CEO Darshan Bathija announced that the lender signed a term sheet with Nexo for up to 100% acquisition.
I understand that a lot of our customers are nervous about your funds. We are working tirelessly to ensure your financials are protected. To that end, we’ve signed an indicative term sheet with @Nexo to acquire up to 100% of Vauld: https://t.co/HrnQO7J64f
— Darshan Bathija (@darshanbathija) July 5, 2022
Vauld has $330 million in assets and $400 million in liabilities at the group level, Bathija said in an email to creditors last month. The platform had raised $25 million in July last year from Peter Thiel’s Valar Ventures, Coinbase Ventures, and Pantera Capital.
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