Vauld to seek moratorium against its creditors
Vauld becomes the next victim of the market crash, post Terra-UST debacle
Singapore-based Crypto Lender Vauld, backed by Peter Thiel and Coinbase Inc., filed for a moratorium in an effort to gain more time to restructure its business after its operations were affected earlier this month by falling asset values.
A Singaporean moratorium order is comparable in principle to Chapter 11 bankruptcy according to the U.S. bankruptcy code. It aids the business in avoiding a total shutdown and asset disposal. According to a spokesperson of Vauld Group, the company applied on July 8 to request a moratorium order in the organisation's favour.
In a blog post on July 11, Vauld stated that:
"The management has decided that, in light of the current circumstances, it would be in the best interests of all stakeholders (including creditors) to file the Application for a moratorium order … This is to give Defi Payments [its Singapore entity] and the Vauld management the breathing space it requires to prepare for the intended restructuring for the benefit of all stakeholders."
Due to unfavourable market conditions, Vauld ceased deposits, withdrawals, and trading on July 4. This ended a tumultuous three-week period during which users attempted to withdraw approximately $198 million from the site.